U.S Healthcare exam 2 objectives Flashcards
Recognize the flow of dollars in the US Healthcare system
who drives health care cost & what may uncontrolled costs lead to
the drivers of healthcare cost
-Overuse or inappropriate utilization
-Inefficient payment systems
-High prices
-Excessive administrative cost
-Medical liability
-Declining health status in the population / chronic disease
Uncontrolled costs may lead to inaccessible and inequitable care
Define the different methods of controlling cost
so what are the 3 methods of controlling cost
what are the 2 ways to help the flow of money in health care?
what can help with finance control?
what needs to be considered as part of competition
what is the weakness of financing controls?
A - financing control
follow the money:
money goes from payers (taxpayers & employers) who pay a premium/financing to a health plan (financing control) that pays (payment control) money to providers
Way to implement finance controls
- regulatory strategies: pass laws or create taxes, ACA, Medicare part A
- competitive strategies: if there are more insurance options the buyers will look for more affordable options, multiple plans competing for the lowest cost, payers, and being the more effective
in competition strategies:
- consider who’s buying: employer-based insurance takes up most of the high cost of insurance, the employer does not consider paying for health insurance as lost wages, the employee has a higher federal tax exemption and the employer saves money
- does it work?: premiums grow 5% every year, and there is really no competition right now on the market
B - payment control
- target either the price or quantity
- cost = price x quantity
- price (reimbursement): uniform fee schedules (fee for service- may impact the care that patients receive), competitive bidding, reference pricing, prospective payment services
- quantity (utilization): cost sharing, supply limits, decreased utilization, unit of payment
ways to implement payment control:
- pricing & utilization
for pricing:
reference pricing results in competitive bidding of private insurance plans to have the best cost for services
- example:
Choice Ref PPO asks each hospital in its market region to submit a bid for the cost of a knee replacement. Most bids are around $40,000. High-Value Hospital submits a bid for $33,000. Choice Ref informs patients enrolled in their plan that they can choose any hospital for a knee replacement, but that they will only pay the hospital $35,000 and the patient is responsible for the rest. After this policy, 75% of Choice Ref patients get knee replacements at High-Value Hospital.
C- Utilization controls
- health insurance need to manage how often their patients use health services
3 methods to consider
- change the unit of payment: how the services are paid for
- influence patient behavior: patient cost-sharing (Discourages both appropriate and inappropriate care– can reduce cost, has little effect on the most costly/extremely ill)
- physician behavior
supply limits:
- May depend on the number of caregivers
——-Supplier-induced demand = more surgeons equals more surgery
-Limited resources (MRI scanners, hospital beds, etc.)
-Can occur within a health system (HMO) or geographic region
Identify scenarios where various methods of cost control have been implemented
for payment control
price controls:
Reference pricing
Example:
Choice Ref PPO asks each hospital in its market region to submit a bid for the cost of a knee replacement. Most bids are around $40,000. High-Value Hospital submits a bid for $33,000. Choice Ref informs patients enrolled in their plan that they can choose any hospital for a knee replacement, but that they will only pay the hospital $35,000 and the patient is responsible for the rest. After this policy, 75% of Choice Ref patients get knee replacements at High-Value Hospital.
also for price control:
Example: Medicaid fee-for-service pays physicians far below private insurance rates
Difficult for patients to find providers who will accept Medicaid
Results in patient churning, reduced quality of care, reduced patient satisfaction
for utilization
under the unit of payment, for example: capitated vs DRG
- capitated: pay a fixed amount regardless of the services used, the physician can simply increase the number of patient visits
under the influence of patient behavior
- Pharmacy and co-pays
Joe pays $20 each time he fills one prescription and the insurance pays for any cost above $20. Because Joe is on multiple medications for chronic disease, he pays $1200 per year on his copayments.
still under the influence of patient behavior
Denial of payment for unnecessary services
- Thelma Graves suffers from a severe hyperthyroid condition; she and her physician agree that she will undergo thyroid surgery. Before scheduling the surgery, the physician has to call Ms. Graves’ insurance company to obtain preauthorization, without which the insurer will not pay
-Fred is hospitalized for an acute MI. The hospital contacts the management firm for Mr. Brady’s insurer, which authorizes 5 hospital days. On the 4th day, Mr Brady developed a complication requiring a temporary pacemaker and an additional 10 days in the hospital. After the 5th day, the physician has to call the management firm every 2 days to justify why the insurer should continue to pay
for supply limits:
- Bob, in Canada, develops back pain. After several visits, the family physician requests an MRI to rule out disk disease. His physician, who does not suspect disk herniation, puts him on a 5-month waiting list for an MRI.
- Rob, in Canada, after lifting 40 kg at work, experienced severe back pain radiating down his leg. Finding a positive straight-leg-raising test with loss of ankle reflex, his physician calls and obtains an emergency MRI scan within 3 days.
The key to cost control in the United States…
“is not in the micromanagement of the doctor-patient relationship but the management of capacity and budgets. The American problem is to find the will to set the supply thermostat somewhere within reason.”
Analyze the limitations and potential negative impacts of cost control
what is the weakness of financing controls?
what is the weakness of payment control?
The weakness of financing controls:
- they must produce decreased flow on the payment side if is it to be successful
- if physicians, hospitals, and other providers are earning more, then taxes will increase so that there is no gap in money
- insurers may raise premiums if they cannot control what they pay to hospitals
-competition places a lot of emphasis on private health insurance to regulate costs
the weakness of payment controls– price control:
- cost shifting: lower cost for one payer and raise the cost for another payer
- patient churning: you lower the cost but then you have a higher rate of patient visits in order to make up for lowering the cost
Describe the four parts of Medicare
What are the two types of coverage options in medicare?
Part A
- part of the original healthcare
- can be a part of the medical advantage which is part C
Part B
- part of the original healthcare
- can be a part of the medical advantage which is part C
Part C
- medical advantage
- includes A, B, and some of D
Part D
- offered through a private health plan
- can be added to part C
two types of coverage
- original
Includes Medicare Part A and/or Medicare Part B coverage
Can add Medicare Part D plan for drug coverage
medicare advantage (part c)
-Includes Medicare Part A and Medicare Part B and usually Part D coverage
Identify the benefits including the medications and immunizations covered under each part of Medicare
Part A
Meds
services
Part B
meds
services
immunizations
Part C
meds
services
Part D
Meds
services
meds excluded
immunizations
Which part of Medicare covers the following supplies?
Blood Glucose Testing Supplies
Syringes
Novolog Insulin 10 ml vial
Part A
Meds:
- medications given at inpatient or SNF stay –needs to be part of treatment
- medications prescribed during hospice care–for symptom relief, do not cover chronic conditions
services:
- Inpatient hospital care
- Skilled nursing facility (SNF) care
- Home health care
- Hospice care
- Short-term nursing home care
Part B
meds:
- Injectable and infusible drugs given in a provider’s office
- Nebulized solutions and medications used in infusion pumps
- Oral cancer and anti-nausea drugs
- Immunosuppressive drugs used to sustain a covered transplant
- Insulin used in a pump
services:
- outpatient medical care, preventative care, mental health services, physical therapy, etc.
- Outpatient surgical services and supplies
- Lab tests
- Durable medication equipment
- Ambulance services
- Home health care
- Diabetic testing supplies: Blood glucose monitor, Test strips, Lancets
immunizations:
- tetanus (injury)
- flu
- hepatitis B (high or intermediate risk)
- pneumonia
- covid-19
- rabies (exposure)
Part C
- Another way to get your Medicare coverage (often called Medicare Advantage)
-Must be enrolled in Parts A and B to join
-Coverage is provided by private companies that provide your Medicare A, B, and often D coverage
-Usually offered as an HMO or PPO
-Must live in the plan’s service area to enroll
meds:
- if includes part D then covered under part D
services: May provide additional benefits like gym membership, wellness classes, dental coverage, vision services
Part D
- Prescription drug benefit
-Provided by private insurance companies
-Voluntary but if don’t enroll and do not maintain creditable coverage may experience a penalty in the future
-Plans vary by medications covered and associated costs
-Open Enrollment is from October 15th through December 7th annually
Meds:
- Prescription brand and generic medications
(Must be approved by the FDA and used for medically accepted indications and sold in the United States)
- Includes drugs, biologics, insulin, and the supplies associated with the injection of insulin
- Generally, must cover at least two drugs in each therapeutic category
- Formularies must include all medications from six protected therapeutic categories
(Antidepressants, antipsychotics, anticonvulsants, anticancer medications, immunosuppressants, and HIV/AIDs medications)
excluded:
-Anorexia, weight loss, or weight gain medications
-Erectile dysfunction drugs when used for sexual or erectile dysfunction
- Fertility drugs
- Cosmetic and lifestyle drugs
- Medications used for symptomatic relief of cough and cold
- Prescription vitamins and minerals
- Over-the-counter medications
- Medications that must be administered by a health professional
- Most medications used in a durable medical device
immunizations:
- shingles
- tetanus (prevention)
- hepatitis B (low risk)
- RSV
Blood Glucose Testing Supplies: covered by B
Syringes: covered by D
Novolog Insulin 10 ml vial: covered by D but if a pump, would be covered by B
Recall the two types of plans that provide Medicare Part D coverage
original medicare (A, B & D)
medicare advantage/part C (A, B, and usually D)
Define terminology associated with Medicare Part D
Premium
Deductible
Initial Coverage
Coverage Gap/DonutHole
Catastrophic Coverage
what did Medicare Part D and the Inflation Reduction Act
Monthly payment to belong to insurance plan
Deductible: Annual amount to pay before coverage begins. Patients must pay for a total cost of drugs up to this amount before standard copayments or coinsurance begin
Initial Coverage: Patient pays standard plan copayments (like, $10) for prescriptions on a tier or coinsurance (like, 25% of the cost of the prescription) on a tier
Coverage Gap/DonutHole: When the benefit stops after a certain spending limit is reached. Patient stops paying standard copayments and starts paying coinsurance ( Brand: 25 %; Generic: 25% )
Catastrophic Coverage: Begins when an out-of-pocket spending limit is reached.
Medicare Part D and the Inflation Reduction Act:
-2023 changes
Insulin copayments will be limited to $35/month
- Eliminates cost-sharing associated with vaccines covered under Medicare Part D
Explain fraud, waste, and abuse as it relates to Medicare with examples
waste vs abuse
Penalties and Consequences for Fraud
fraud
- Intentional misrepresentation of data for financial gain
- Knowingly use false information to gain a payment or benefit
examples:
- Intentionally billing for the administration of a vaccine that you did not give
- Intentionally billing for a more costly service than performed
- Intentionally using someone else’s insurance coverage for services
waste
- Overuse
- Careless or needless use of health care benefits and resources
- Not intentional
example:
Unintentionally billing an inhaler that a patient did not need when he/she was admitted to the hospital
abuse
- Receiving payment for benefits or services without misrepresenting data that results in unnecessary costs to Medicare programs
- Not intentional
example:
- Unintentionally billing duplicate times for one service and receiving payment for benefits
Waste is when someone overuses health services carelessly. And abuse happens when best medical practices aren’t followed, leading to expenses and treatments that aren’t needed.
Penalties and Consequences False Claims Act - Fraud
- Criminal and/or civil prosecution or prison time
- Suspension of provider license and/or Medicare provider status
- Will not be able to get hired
- Exclusion from Medicare program and/or government contracts
- Financial penalties
Define formulary and medication restrictions including prior authorizations, step therapy, and quantity limits
formulary
- List of medications covered by an individual prescription plan based on current evidence-based medicine
- offered through tier pricing
- tier 1: Generic
- tier 2: preferred brand
- tier 3: non-preferred meds
- tier 4: specialty meds
- tier exceptions: A way to lower cost-sharing by showing medications in lower tiers are ineffective or dangerous
Prior Authorization
- Information from the prescriber to the insurance plan stating the therapeutic need for the medication is required
- Beneficiaries receive medications that are safe, effective, and provide the greatest value
step therapy
- Information from the prescriber to the insurance plan showing the patient has failed on other medications before being given approval for prescribed medication
- Beneficiaries are encouraged to use well-established, cost-effective first-line medications
quantity limits
- Restricted to a maximum dose allowed to be dispensed in a given time frame– so there is a limit on the quantity that can be dispensed
- Beneficiaries are encouraged to use FDA-approved durations and dosages
Healthcare providers can impact costs by prescribing medications in lower-tier levels
Describe programs that may help with the cost of Medicare Part D including the federal Extra Help program and state programs including Medicaid and the State Pharmaceutical Assistance Programs
federal Extra Help program
- available in every state
- helps with part D premium, deductible and copayments
- eligible if: 1 person: $1,843 monthly income/$16,660 assets
2 people: $2,485 monthly income/$32,240 assets
- Call SSA 800-772-1213 to enroll or apply online at https://secure.ssa.gov/i1020/start
Medicaid
- State-sponsored health and prescription benefit programs
- Referred to as dual eligible when added to Medicare
- Many different coverage types depending on age and status
- Eligibility guidelines vary according to income and status
- Helps with copayments, premiums, and deductibles of covered Medicare Part D medications
Pharmaceutical Manufacturer Programs/Patient Assistance Programs:
- Provides free or low-cost brand-name medication to eligible individuals
- Short-term, but can reapply each year
- Usually shipped to the patient or health care provider
- Helps uninsured or underinsured
- Eligibility guidelines vary – typically up to 250% of FPL
State Pharmaceutical Assistance Program
- State administered programs that assist low-income older adults and individuals with disabilities in paying for prescriptions
- Supplements Medicare Part D coverage but varies from state to state
- Secondary payer to Medicare Part D for most individuals
- Fills in the coverage gap (“donut hole”)
- Free for most people
New Hampshire AIDS Drug Assistance Program
Diagnosis of AIDS or HIV
Income tested
Identify private assistance programs and strategies that may help patients with the cost of medications
search for assistance programs on needymeds
these are the private assistance programs:
Patient Assistance Program: pharm. manufacturer programs
Copayment Foundation
- Charitable organizations that may help pay for certain prescription co-payments, deductibles and plan premiums.
- Medication and Diagnosis Specific
- Medication must be a covered drug w/current insurance
- income guidelines vary – some as high as 500% of the FPL
- Grants are typically awarded on an annual basis
- Re-application is required each year
Special Generic Drug Pricing Program
- Low-Cost Generic Medications
- Offered by many retail pharmacies
- Some pharmacies offer certain medications for free
- Available to anyone
- Any income
- Any age
- Insured or uninsured
- Not insurance
- offered by: stop and shop, Price Chopper, shaws, Wegmans, Hannaford, Walmart
Prescription Drug Coupons
- Free coupons
- For anyone to use
- Cannot be combined with insurance
- Does not discount insurance copayments
- Accepted at most pharmacies
- Prices available on their website
- Print, or save the coupon to your smartphone
- can find on goodrx.com!
Non-Profit Mail Order Pharmacy
- Rx Outreach Program is a non-profit, charitable organization that provides low-cost, generic medications via mail order.
- Over 600 medications are available
- No enrollment fees
- No membership fees
- No shipping or handling charges
- Pay only the price of the medication
- Income Guidelines: $58,320 for one | $78,880 for two
Other Options
- co-pay cards: med specific, given by pharm. companies for brand names, reduce co-payment or may pay 100% of copay, for ppl with employer-sponsored health insurance
- Free Trial Offers: Offered by pharmaceutical companies
Typically for new medications
Usually for anyone to use
Not readily available
Provided by physicians
Available at some pharmacies
- Price Chopper Diabetes Advantedge Program
- Free medication and low-cost supplies at Price Chopper grocery store pharmacy
- Not insurance
- Available to anyone
Define quality in healthcare including the quality defects, quality aims, and components of high quality healthcare
quality in healthcare
- is the degree to which health services for individuals and populations increase the likelihood of desired health outcomes and are consistent with current professional knowledge
quality defects
- underuse: Evidence-based practices are not used as often as they should be
- overuse: Evidence-based practices are used more frequently than evidence supports
- misuse: Processes or products are not used correctly
quality aims
- Safe – keep patients safe while caring for them
- Effective – develop evidence-based practices to serve as standards for care
- Efficient - keep care cost-effective and remove waste from systems
- Timely – avoid waits and delays for patients
- Patient-centered - care should revolve around patients, considering their preferences and giving the patient a say in their care
- Equitable – get rid of disparities in healthcare – avoid unequal treatment
Components of High-Quality Healthcare
- Access
- Adequate scientific knowledge
- Competent providers
- Separation of financial and clinical decisions
- Organization of healthcare institutions to maximize quality
Understand the types of quality measures including structure, process, and outcome measures
Structure
- Information about staffing, capacity, and volume
Ex: How many RPh work per day per patient
Ex: How many technicians work in each pharmacy
Ex: Workflow for prescription verification and filling
Process
- Procedures that are followed when providing patient care
Ex: % of patients screened for cancer as recommended
Ex: turning rate of immobile patients to prevent bed sores
Ex: prescribing rate for aspirin to patients with coronary heart disease
Outcome
- Endpoints or outputs of healthcare
Ex: Infection rate post-surgery
Ex: the mortality rate for catheter-related infections
Explain several proposals for quality improvement in healthcare
Just Culture Concepts
- Sanctioning “bad apples” is only appropriate for reckless behavior in a just culture
- Punishing bad actions is only appropriate for reckless behavior
- Important takeaway = punishing bad apples does NOT solve the quality problem
- Just culture = people are generally good, focus on making systems we use safer, punishing all behaviors would not improve quality in the future
3 expected behaviors – see table
- Human error – simply a mistake
- At-risk behavior – taking shortcuts, cheating the system
- Reckless behavior – disregarding the right way of doing things
Human Error
Simply making a mistake
Processes, procedures, training
Console
At-risk Behavior:
Taking short-cuts or cheating the system
Incentives for good behavior and increased situational awareness
Coach
Reckless Behavior:
Disregarding the right way of doing things
Remedial and punitive actions
Punish
clinical Practice Guidelines
- Help ensure providers have easy access to the latest evidence
- Over 2,700 guidelines exist
- Limitations
- Must consider patient-specific factors and preferences
- Must use clinical judgment
Measuring practice patterns
- Monitoring of process and outcome measures within a group or healthcare system
- Useful to track measures over time and among groups
- Prefer to use measure to build a better system or process rather than identify bad apples
- Root cause analysis (RCA)
Why or where an error occurred
PROCESS: prescribing ASA to patients, turning patients in a hospital bed
OUTCOME: death, adverse events, mental health, laboratory tests, etc
Describe value-based care and impact on pharmacy
Value-based networks
- Move from volume to value
- Platforms between pharmacy and payers evaluating data to show that value is being provided
