U.S Healthcare terms & lecture--exam 1 Flashcards
here are the terms and lecture info for U.S Healthcare
Is health care a right?
what act tried to enforce that
what is needed for the cost of healthcare
what happens to a patient when the costs of healthcare increase
Clinical care + Standard of living + Public health measures =
Yes!
2009 Affordable Care Act (ACA)
Limits are needed on the costs of healthcare
When costs increase access to care decreases
Clinical care + Standard of living + Public health measures = Outcomes on the health of a population
What are features of health care that we should look for?
A
A
A
Hq
Accessible
Affordable
Appropriate
High Quality
Health Care Issues Include
how do people pay for healthcare?
what does healthcare make appropriate
Uninsured
Paying for health care: individuals, employers, Medicaid, Medicare, health connector
Appropriateness of care and medications
Health Care Waste Estimates in the US
what is the waste of healthcare due to
Ep
Fa
Ci
Aw
Mp
Ov
Wasted health care dollars estimate: 2019: $760-$935 Billion wasted annually
Excessive prices
Fraud and abuse
Clinical inefficiency
Administrative waste
Missed prevention
Overuse
Reasons for being uninsured among uninsured nonelderly Adults 2021
is the coverage affordable?
are they eligible for coverage?
do they need or want it?
is signing up simple and straightforward
do they find an appropriate plan that meets their need
coverage not affordable
not eligible for coverage
do not need or want
signing up is hard and confusing
cannot find a plan that meets needs
barriers to health care among nonelderly adults by insurance status
did they see a provider?
do they have a source of care?
why would they postpone care?
did they go without care for some time?
did not see a doctor/health care professional
no usual source of care
postponed seeking care due to cost
went w/o needed care due to cost
delayed filing or did not get needed prescription due to cost
View and Crisis?
“The US has least universal, most costly health care system in the industrialized world.” –Understanding Health care Policy p. 2.
What we need to learn about is:
who
how
prevention
how
how
Who gets paid how?
How is health care organized?
Prevention versus treatment?
How to reduce costs?
How to increase quality?
Excess versus Deprivation
do people have too much
too little
just right
Too much health care- Really?
Too little health care- uninsured, underinsured
Just right health care- “Goldilocks”
Access
to make contact with or gain access to; be able to reach, approach, enter
Affordability
that can be afforded; believed to be within one’s financial means:
attractive new cars at affordable prices.
Appropriateness
the quality of being suitable or proper in the circumstances.
Excess
an amount of something that is more than necessary, permitted, or desirable.
Deprivation
the lack or denial of something considered to be a necessity.
Affordable Care Act (ACA)
is the name for the comprehensive health care reform law (passed in 2010) and its amendments. The law addresses health insurance coverage, health care costs, and preventive care.
Healthcare reform makes health coverage available and more affordable for millions of Americans. It gives subsidies for those who purchase private insurance and California expanded Medi-Cal to include more people and single adults.
Health care system
an organization of people, institutions, and resources that delivers health care services to meet the health needs of target populations.
Out-Of-Pocket payments
is the direct payment of money that may or may not be later reimbursed from a third-party source. For example, when operating a vehicle, gasoline, parking fees and tolls are considered out-of-pocket expenses for a trip.
what is considered to be private insurance
Does a plan purchase through insurance company count as one too
a plan provided through an employer or union; a plan purchased by an individual from an insurance company; or TRICARE or other military health coverage
Employment-based private insurance
a health policy selected and purchased by your employer and offered to eligible employees and their dependents. These are also called group plans.
Government Financing
issuance of Parity Stock or Senior Stock to, or the incurrence of Indebtedness owed to, a local, federal or foreign governmental entity (a “Governmental Entity”), or designee thereof (in each case, excluding a sovereign wealth fund who regularly makes financial investments), in connection
Medicare
federal health insurance for people 65 or older, and some people under 65 with certain disabilities or conditions.
Medicaid
is the nation’s public health insurance program for people with low income.
provides health coverage to millions of Americans, including eligible low-income adults, children, pregnant women, elderly adults and people with disabilities
Uninsured
not covered by insurance.
Underinsured
having inadequate insurance coverage.
Premium
an amount to be paid for an insurance policy.
Deductibles
a specified amount of money that the insured must pay before an insurance company will pay a claim.
Copayments
a contribution made by an insured person toward the cost of medical treatment or other services.
Coinsurance
a type of insurance in which the insured pays a share of the payment made against a claim.
Health Plan
is a type of insurance that covers the whole or a part of the risk of a person incurring medical expenses. As with other types of insurance, risk is shared among many individuals.
Provider
a person or thing that provides something.
Individual Mandate
provision within the Affordable Care Act that required individuals to purchase minimum essential coverage – or face a tax penalty – unless they were eligible for an exemption.
Community rating
a rule that prevents health insurers from varying premiums within a geographic area based on age, gender, health status, or other factors.
so makes the cost of premiums the same regardless of age, gender, health status, or other factors!
Experience Rating
the amount of loss that an insured party experiences compared to the amount of loss that similar insured parties have.
Eligibility
the state of having the right to do or obtain something through satisfaction of the appropriate conditions.
Enrollment
the action of enrolling or being enrolled.
Modes of Health Care Payment
Out-of-pocket
Individual private insurance
Employment-based group private insurance (which is a health policy selected and purchased by your employer and offered to eligible employees and their dependents. These are also called group plans)
Government financing
Out-of-pocket
Need versus luxury
The unpredictability of need and cost: cannot predict illness or surgery
Point of care physician recommendations
cascade for individual private insurance
How do I get insurance if my spouse has no job with the family plan?
Individual Private Insurance Individual Health Plan Provider
You have to get private insurance
Individual Mandate
Required healthcare
Subsidies for costs help those with income between 100-400% federal poverty level
Insurance purchased through marketplaces or health insurance exchanges
have insurance thru job and entire family is covered so we meet the individual mandate
Employment-based Private Insurance
What happened for Baylor University Hospital
what happened in WWII
1929- Baylor University Hospital provided hospitalization for school teachers $6 per person per year
WWII was unable to increase wages, instead increased benefits and began to offer health insurance (this is where benefits come from)
After the war unions picked up on the healthcare option and negotiated benefits
Employer premiums are tax deductible (employers can provide healthcare cause they get a tax break)
expenses and the benefit is not considered taxable income for the employee, therefore the government “sponsors/subsidizes” employer-based health care, estimated to equal $250 billion yearly of “uncollected” “taxable” “income”.
ACA mandated employers with 50 or more employees offer coverage or pay a fee in penalties for not providing insurance.
Community versus Experience Ratings
Community Rating- All have the same premium no matter their health status: everyone paid the same $, high-risk persons (someone working on ladders, coal miners) paid the same as low-risk (bankers)
How insurances began
Difficult to be competitive because everyone pays the same
so basically, everyone in the community pays the same
Experience Rating- The base premium is decided on the average “needs” of the group
Higher premiums for coal workers, the elderly, sick
Began due to competition to bring lower premiums for groups
Appears to be discriminatory to some
so basically, you pay based off of your experience
ACA: Community versus Experience Rates
What will happen if people do not pay much for health insurance?
what if co-payments are high vs low
Insurers experience rates are limited to:
Family size
Geographic location
Age within limits of younger versus older rates
Smoking status: can be charged more because @ risk
If people do not need to pay much for health care then the use of services will increase and insurance companies will need to pay more, Having individuals responsible for part of the costs, which has been rising, causes less use of services
higher co-payments, people wait longer to be treated, if no co-payments, then they would be quick to go to the hospital
Government Financing
1950’s & 1965
1950’s:
Poor and Elderly were struggling for Health Care
Poor: Either did not have a job or jobs without fringe benefits
elderly: Could not afford the trend toward experience ratings
Less than 15% of the elderly had health insurance: so lots of out-of-pocket purchases
1965:
Medicare: For the Elderly
Large deductibles, copayments, and gaps
Covered approximately 58% of average medical costs in 2012
Medicaid: For the Poor
Also need to meet other criteria: young child, pregnant, elderly, disabled
Medicaid expansion in some states has taken away these stipulations
Medicare
Medicare enacted for the elderly in 1965
People eligible for Social Security are automatically enrolled at age 65 Under 65, disabled for and receiving Social Security for 24 month Individuals with ALS, end-stage renal disease, or transplants-no waiting period required ( so they do not wait 2 years)
Medicare Part A
inpatient to your costs
skilled nursing facility (SNF) Care to eligibility to your costs
long-term in patient care (SNF) to your costs
Financed through the Social Security System through income payments by employers, employees, and those self-employed.
Medicare Part B
Medically necessary services: lab work, x-rays, physicals…
Preventative services
Financed through income taxes, federal taxes, and premiums: some people get until 65
Medicare Part C and Part D
when prescriptions get covered
Medicare Part C: Includes more health coverage plus a full prescription drug coverage
Private health plans also called Medicare Advantage Plans
Medicare subsidizes the premium
The majority of plans are health maintenance organizations (HMOs)
Medicare Part D: Prescription Drug Benefit (drug covered only)
Criticized for: major gaps in coverage, provided through private insurance versus a federal program, non-negotiable prices with pharmaceutical companies to lower drug prices
Medicaid
for low income kids
1965-2014: Low income plus needed to fit into categories of eligibility
Children typically covered 100%
Federal government pays 50-76% of total costs depending upon per capita incomes
2015:
Medicaid expansion lifts eligibility criteria; income up to 138% federal poverty level
The federal government pays 100% of newly eligible from 2014-2016 then decreased to 90% thereafter
Undocumented immigrants are not eligible
Taxpayer contribution
Medicare: Eligible if you have paid a certain amount into the Social Security system
Medicaid: Those who contribute may not be eligible
Healthy employees tend to pay more into the system for health care than those disabled, lower income, who may be using more services
Financing Health Care
progressive payment
regressive payments
proportional payments
Progressive payments: Rising % of income taken as income increases
Increased income Increased payments
Income taxes are progressive
The more I make, the more I pay
make more, pay more
Regressive payments: Falling % of income taken as income increases (considered “unhealthy”)
Increased income decreased payments
Experience rated is a regressive method of financing
Community-rated is also regressive but less so than experience-rated
everyone pays 10% whether millionaire or poor
make more, pay same–not cool
Proportional payments: The ratio of payment to income is the same for all income classes
The ratio of income to payment same for all classes
regressive payments by year
2017:
47% of health care expenditures were out-of-pocket payments and premiums= REGRESSIVE
43% funded through government revenues= PROPORTIONAL
____________________________________
Sum Total of health care financing= REGRESSIVE
2013: Medical expenses lowered the lowest income by 47.6% compared to the top decile by a mere 2.7%- so those who make the most, pay the least
Individual private health insurance ACA
Varies based on needs and affordability
bronze
Silver
gold
platinum
Bronze: 60% coverage, premium is low, out-of-pocket is high
Silver: 70% coverage, premium is higher, out-of-pocket is less
gold: 80% coverage, premium is high, out-of-pocket is low
platinum: 90% coverage, premium is very high, out-of-pocket is very low
objectives for lecture 2
- Identify reasons for being insured
- Assess the difference health insurance may make versus those without health insurance including access and outcomes and the impact of Medicaid
- Identifying underinsurance and knowing insured does not mean guaranteed access
- Describe the impact that income and race have on health status
what happened throughout
1980-2010
2010-2013
2014
2018
1980-2010: Number of uninsured grew from 25 million to 50 million
2010-2013: States began to enroll more individuals and families into Medicaid
2014: Implementation of ACA private insurance mandates and Medicaid expansion
2014: Decrease of uninsured from 41 million to 26 million
2018: Uninsured has increased again to 28.3 million (healthaffairs.org)
2023: Decreased to 25.3 million (per CDC)
Reasons for Uninsured
- skyrocketing cost of health insurance
- economy & workforce of the U.S
- Private insurance linked to employment leads to interruption of coverage
Skyrocketing cost of health insurance
-From 2000-2014 premiums rose 160%
2014: average individual plan cost=$6,025; average family plan cost=$16,834
-Shift of employers increasing cost burden to the employee paying 29%-44% in 2014
Economy and workforce of the United States
-Decrease in manufacturing and unionized employees
-Increase in service sector, part-time employment without health benefits
Private insurance linked to employment leads to interruption of coverage
-People laid-off or people who leave their job
-Divorce or death of spouse that carries insurance
-Consolidated Omnibus Budget Reconciliation Act (COBRA) allows those who leave job to continue coverage but are responsible for the full payment of the premium
Characteristics of Nonelderly Uninsured, 2021
Family work status
family income
race/ethnicity
what Illness follows those that are Uninsured
Higher rates hypertension
Higher rates cervical cancer
Lower survival rates for breast cancer
Less frequent blood pressure screenings
Less frequent Pap Smears and Breast Exams
Uncontrolled hypertension, diabetes, and cholesterol (= Metabolic Syndrome)
what health outcomes do those with Medicaid have compared to those that are Uninsured
Better self-reported health
Improved depression scores
Increased use of preventative services
Less financial stress
Note: Having Medicaid did not increase the control of hypertension or diabetes
medicaid copayments & copay cap
pharmacy copays for drugs covered by mass health, including both first time prescriptions and refills
$1 for certain generic drugs
$3.65 for each prescription and refills for the generic, brand name and OTC meds covered by masshealth
a copay cap is the highest dollar amount that a person can be charged in copays for a given time period
there is a cap for mass health– no more than 2% of your monthly household income each month
people with inadequate insurance have more
problems paying medical bills
uninsured or underinsured adults often avoid or defer getting
needed health care and meds
people with higher deductibles more frequently report
financial problems because of medicals bills or delaying care because of cost
Nonfinancial Barriers to Health Care
Inability to Access
Language barriers:
Health literacy:
Cultural barriers:
Gender:
Inability to Access: Shortage of Primary Care Providers; lack of after hours appointments
Language barriers: Miscommunication, no understanding
Health literacy: Forms that need to be filled out can be difficult
Cultural barriers: Beliefs, values, and attitudes vary among patients and providers
Gender: Women’s health services, scope of coverage/essential health benefits
wrap up of lecture 2
Review who is uninsured and why there are still issues with uninsured.
Recognize the impact of health insurance on health outcomes.
Some with insurance are underinsured, be able to compare that with insured and uninsured.
Describe the impact of income and race on health status.
Units of payment
Can be placed on a continuum ranging from simplest to the most complex methods
Definitions of methods of payment important to know
Fee-for-service payment
A fee is paid for each service provided (office visit, diagnostic test, medication)
The only form of payment based on each individual unit or component of health care provided
No aggregation or grouping together of services into one unit of payment
The fee may be paid by the patient or the private insurance company
Methods of payment for providers (Physicians)
Fee-for-service
Episode of illness
Capitation
Payment for time (Salary)
Preferred provider organizations (PPO)
Loose-knit organizations where insurers contract with a limited number of providers and hospitals forming a network
Agreement is to care for patients on a discounted fee-for-service basis making use of utilization review
The insurer authorizes or denies payment (prior authorization) deemed unnecessary or expensive
Patients pay a higher share of the cost if they utilize providers or hospitals outside of the network
Fee-for-service payment
Physicians have an economic incentive to perform more services to bring in more payment
Not seen often with physicians or hospitals
The concept of risk
Risk – the potential to lose money, earn less money or spend more time without compensation for services
Payment per episode of illness
One sum is paid for all services delivered during one illness
Uses bundling together of payments referred to as payment at the unit of the case or episode
May lead to economic incentive for providers (surgeons, obstetricians) to limit the number of postop visits since they do not receive additional payment BUT may give incentive to perform more surgeries or see more patients
The more services aggregated into one payment, the larger the share of financial risk shifted from the payer to the provider
Capitation
Payment per patient
Monthly payments made to physician or group for each patient that receives care from them
Explicitly defines in advance the amount of money available to care for each enrollee
Shifts financial risk from insurers to providers
Carve-outs: reintroducing fee-for-service payments for specific services not covered by the capitation coverage:
–Specific diagnostic testing
–Specific surgical procedures
–Non-formulary medications
based on a patient not illness
if extra lab tests or services are required outside of what the insurance has paid the provider, then the provider will have to pay
hospital bills insurance and insurance covers a set amount, anything above the set amount will be paid for by the provider
Risk adjusted capitation:
utilized for patients with serious illness that require more services than what is standard
Provides higher monthly payments for elderly patients and those with chronic illnesses
Often difficult to determine who (patient or insurance company) requires the higher monthly capitation payment
what are patients required to do for capitation
what does it allow
what does it provide
does it allow for continuity of care
Patients required to register with a physician or group practice
Allows more flexibility at the practice level in how to most effectively and efficiently organize and deliver services
Provides framework for rational allocation of resources and development of better methods of service delivery
Allows for continuity of care
what are the 2 and 3 tiered structure for capitation
Two-tiered structure–
Payments are paid directly to primary care physicians and referral services
Three-tiered structure–
–An intermediary administrative structure is utilized for processing payments
–Physicians join an independent practice association (IPA) and are paid on a fee-for-service basis from a pool of money (risk pool)
–At the end of the year money left over in the risk pool is distributed as bonuses to the physicians
–Provides incentive for judicious utilization of diagnostic and specialty services
Payment per time: Salary
Physicians in the public sector (municipal, VA, state facilities) are often paid an annual salary
Also utilized in HMO’s (more to come)
Physicians paid by salary bear little to no individual financial risk
Methods of hospital payment
Fee-for-service
Per Diem
Payment per episode of hospitalization (Diagnosis-related groups)
Capitation
Global budget
Payment per procedure: Fee-for-Service
All services are itemized during a hospital stay
The itemized bill containing reasonable costs is sent to private and public payers for reimbursement
Allowed hospitals to have great influence in determining level of payment
With increased concerns with cost containment for payers methods of payment have shifted away from fee-for-service
Financial risk leans towards the payers
Payment per day: Per Diem
Where does the risk lie?
Insurers andMedicaidplans contract with hospitalsfor per diem paymentsrather than fee-for-service
The hospitalreceives a lump sumfor each day thepatient is in the hospital
Per diem paymentsrepresenta bundling of all services provided
Insurers mayperform utilizationreviewsof chartsto verify that patients needto be in the hospital
Length of stayis monitored closely
Where does the risk lie?- with insurer
risk for Per Diem
The insurer isat risk for the number of days a patient stays in the hospital because they pay by the day
The servicesdelivered in a dayis a fiscal concern (risk) to the hospital
More days in the hospitalequals moremoney the insurer is billed for
Risk is shared between the insurance and provider
insurance pays per diem (pays per day to day basis)
hospital using their services
paying for however long the patient is in hospital
