Question | Answer |
What are the 3 cornerstones of HC delivery? | Cost
Access
Quality |
An interactives relationship exists b/t | 1. Cost of HC
2. People's ability to get HC when needed
3. Quality of services delivered |
Uncontrolled expenditures mitigate a nation's ability to provide access to quality HC | Focusing on access b/c # of poeple needing care is increasing
Have to counter providing access with quality |
Why did HC spending increase a lot in the 1970s? | Massive growth in access created by Medicare & medicaid programs in 1965. Signed into law by JFK |
The main culprits for the recent rise in expenditures | Hospital services
Prescription drugs
Physician services |
Macro Perspective of HC "Cost" | HC Expenditure or Spending:
Reflects consumption of economic resources in delivery of HC
Resources are insurance, pro's skills, drugs, med equipment, discoveries |
Gross Domestic Produce (GDP) | Gov't tracking of our economy & what we spend on goods & services
Dollar amount spent on goods & services
How much/what % is gov't spending on HC vs. other goods/services
% of what is spent on HC continues to increase yearly |
Consumer Price Index (CPI) | Comparison b/t general economic inflation & HC cost inflation
Measures general inflatoin in economy & calculates annual changes
Decreased b/c of managed care & Medicare creating caps |
NHE (Nat'l HC Expenditure/HC SPending) | GDP- total net value of all goods & services in general economy
2011- US spent 2.8 trillion on HC: 18% of GDP
Anticipated to be 20% of GDP by 2015 |
Micro Perspective, or the "Price" of HC | Costs incurred by employers to purchase insurance
Out of pocket costs incurred by individuals when they receive HC services
Physician's bill
Price of prescriptions |
Cost of production of HC | Staff Salaries
Capital equipment/building costs
Rental of space to provide services
Supplies |
Reasons for Cost Escalation VERY IMPORTANT!!*** | 3rd party payment
HC is an imperfect market
Growth of technology
Increase in elderly population
Medical model of HC delivery
Multi-payer system & admin costs
Defensive medicine
Waste & abuse
Practice variations |
Third Party Payment | Moral hazard
Provider-induced demand |
Imperfect Market | Utilization of HC driven by need, not demand
Quantity of HC produced is usually higher than in competitive markets
Prices permanently higher than true cost of production |
Technology & specialization | Beliefs & values
High R&D spending
Innovation that leads to utilization
Surplus of specialists |
Increase in elderly population | Increased longevity
Baby boomers
Elderly use nearly 3x as much HC as younger people |
Medical model of health | Misplaced emphasis on medical treatments
Health promotion/disease prevention takes a back seat |
Multi-payer system & administrative costs inefficiencies related to | Financing
Insurance
Delivery
Payment fxns
Enrollment process
Contracts
Claims processing
Utilization
Denials & appeals
Marketing |
Defensive Medicine | Medical tests & treatments that aren't justified, but done for self-protection |
Waste & Abuse | Inefficiencies & fraud
Major problem in medicare/medicaid- unnecessary services, upcoding, misallocation of costs to increase reimbursement
Receiving kickback for referrals
Self-referral |
Practice Variations (Small area variations) | Differences in practice patterns
Associated with geographic areas
Signal gross inefficiencies
Compromise cost & quality |
Cost Containment Pros | Increased costs cause people to spend HC>other goods/services
HC is imperfect market so pts will utilize as much as they can to get the most use of insurance
Increased costs means increased costs to gov't funded insurances, thus increased taxes |
Medicare could be depleted by when? | 2018
Longevity of Medicare already a concern, which is why the balanced budget act of 1996 was created |
Cost Containment Cons | Increasing costs creates more jobs
Increasing costs encourages more resources into a positive sector of our economy
Positive sector as opposed to factories that pollute air/destroy lives (HC saves lives) |
Cost Shifting | Providers make up for lost revenues by increasing utilization or charging higher prices in other areas free of controls |
Two successful cost-containment periods in US History | 1. 1983-4 DRG Implementation
2. 1995-8 Balanced Budget Act & other major managed care penetration into HC |
Cost containment regulatory approach- All-Payer (Single-Payer) System | Top-down control (global budgets)
US doesn't have an all-paer system (bottom-up cost control, cost shifting occurs) |
Cost containment regulatory approach- Health Planning | Thinking more about community & prevention
Govt's efforts to align & distribute HC resources to achieve health outcomes
No system-wide planning & controls in US |
Containment- Price Controls | Important event to control price for IP hospital care was converting hospital Medicare reimbursement from retro- to prospective system |
Utilization Controls- Peer Review Orgs (PROs) | State-wide private orgs composed of practicing physicians & HC providers employed by managed care orgs (MCOs)
Can deny payments if care not medically necessary
Each state has its own PRO
Now called Quality Improvement Orgs (QIOs) |
Cost containment Competitive Approach- Demand-Side incentives | Cost sharing by consumers
Self-rationing mechanism
RAND experiment- lower HC costs with cost-sharing mechanisms in place
Ex: Co-pays, deductibles, sharing premium costs |
Cost containment Competitive Approach- Supply-Side incentives- Anti-Trust Laws | Prohibit business practices that stifle competition among providers
Ex: Price fixing, price discrimination, exclusive contracting arrangement, mergers
Forces HC orgs to be cost-efficient |
Cost containment Competitive Approach- Payer-Driven Competition | Pt's not customers- they pay little out of packet & lack technical info
Payer-driven competition occurs at 2 levels- employers shop for value in insurance plans; managed care shops for best value from providers |
Access to Care | Ability to obtain needed, affordable, convenient, acceptable, & effective personal health services timely
Implications: determinant of health, benchmark in assessing effectiveness, equity, quality & efficient use of needed services |
Access concepts | Does pt have a source of care (PCP)?
Use of HC- availability, convenience, referral
Acceptability of services- pt's preference & values |
Dimension of Access- Accessibility | Fit b/t locations of providers & pts
i.e. transportation, convenience |
Dimension of Access- Affordability | Ability to pay |
Dimension of Access- Accommodation | How resources are organized to provide services & the pt's ability to use the services
i.e. timely appts, quick service, walk-ins, etc. |
Dimension of Access- Acceptability | Compatibility (waiting time; race, culture, gender, etc) |
Potential Access | Capacity
Organization
Financing |
Realized Access | Type
Site
Purpose of health services |
Equitable/inequitable Access | Distribution of HC to pt's perceived need |
Effective & Efficient access | Links realized access to health outcomes |
Microview of quality | Clinical (technical) aspects
Interpersonal aspects
Quality of life- General HRQL, Disease-specific HRQL, Institution-related QoL |
Macroview of Quality | Mortality
Incidence & Prevalence |
Institute of Medicine definition of quality | Degree to which health services for individuals & populations increase the likelihood of desired health outcomes & are consistent with current professional knowledge
*Leaves out roles of cost & access in the eval of quality |
Institute of Medicine definition has implications | Quality occurs on a continuum
Focus is on services provided by the system
Quality may be evaluated from individual or population's perspective
Emphasis on desired health outcomes
Professional consensus used to develop measures of quality |
Donabedian's 3 domains in which HC quality should be examined | Structure
Process
Outcomes
All are important in measuring quality & are complementary, so should be used collectively |
Donabedian Model- Structure | Facilities: license, accreditation
Equipment
Staffing levels
Staff qualifications
Staff training
Distribution of hospital beds, physicians, etc. in a given population |
Donabedian Model- Process | Clinical practice guidelines- EBP, professional consensus when scientific evidence lacking
Critical pathways- timeline, ID's planned medical interventions, with expected pt outcomes for a diagnosis |
Average in Quality- Process | Specific way in which care is provided
Ex: correct dx test & prescriptions, accurate drug admin
Main developments: clinical practice guidelines, critical pathways, risk mgmt |
Donabedian Model- Processes- Cost Efficiency | Benefits>Costs?
Under-utilization & over-utilization based on cost efficiency |
Donabedian Model- Processes- Risk Mgmt | Proactive
Efforts to prevent adverse events related to clinical care & facility operations- focused on avoiding medical mal-practice |
Average in Quality- Outcomes | Effects/final results obtained from utilizing structure & processes of HC delivery
Measure of effectiveness of HC delivery system
Suggests overall improvement in health status
Measures include: infection rates, rates of rehospitalization, pt satisfacti |
Developments in Process Improvement- Clinical Practice Guidelines | aka Medical practice guidelines- they're preferred clinical processes
Constitutes a plan for managing a clinical problem based on evidence
Provide protocols to guide physicians' clinical devisions
Intention: Lower costs, get better outcomes |
Developments in Process Improvement- Cost-Efficiency | aka cost effectiveness
Cost efficient when benefits received > cost incurred
Point is optimal quality- demarcation b/t underutilization & overutilization |
Developments in Process Improvement- Critical Pathways | Outcome-based & pt-centered case mgmt tools that are interdisciplinary & facilitate coordination of care among multi clinical depts & caregivers
Time-line that ID's planned med interventions w/ expected pt outcomes for a dx |
Developments in Process Improvement- Risk Mgmt | Pro-active efforts to prevent adverse events related to clinical care & facilities operations, focusing on avoiding medical malpractice |
Quality Initiative- Accountable Care Orgs | Designed to help increase cooperation b/t providers across various HC settings to improve Medicare pt outcomes |
Greatest challenges to HC delivery | Increasing costs, lack of access, concerns about quality
HC costs in US are highest in the world
Access is a determinant of health status |