Health Services & Management

IRS Form 990

publicicly available snapshot of an org’s financial health/governance/operations that report annual information for the fiscal year (it’s a tax exempt, nonprofits must file w IRS

what do u seek out in a 990

profit v loss?

are they providing effective results? good quality?

mission, target population, provided services all stated?

parts of 990

summary, mission, programs, governance, management, compensation, revenue, functional expenses, assets

non profit orgs

private foundation or public charity; reinvest profit back into the org, don’t pay income tax, must provide charity in exchange for tax exempt status

for Profit orgs

investor owned, distribute profit to shareholders, pay income tax, and may offer (charity care to be a good citizen but they gain no tax advantage for doing so)

Always Cite when?

Quoting 2 or more words verbatim or even 1 word if its used uniquely 

Introduce facts found in a source

Paraphrase or summarize ideas, interpretations, or conclusions found in a source

Introduce information that isn’t common knowledge 

Borrowing the plan or structure of a larger section of a source’s argument (using a theory from a source and analyzing the same three case studies the source uses)

I build on another's method found in a source

I collaborate w others in producing knowledge

who are managers?

finance director, medical director, president, CEO

who drafts the budget

staff—they understand what money is coming in and then the board will revise and approve or deny it

metrics for organization evaluation

patient/employee satisfaction, clinical/service quality, patient safety,

fiduciary responsibilities

special responsibility to take care and act in the org best interest

fiduciary responsibilities

duty of care, loyalty, obedience

who determines mission vision and values

governance, governing body, sources of authority

vision

desired future state & what an organization plans to accomplish over a period; in a sense, futuristic because it is what the company hopes to become and wants to accomplish

mission

what an organization represents through good, clear, sound ethical guidelines, agendas, and focuses on what the company is firm on accomplishing

management (vs leadership)

staffing, assure patients, control resources, supervise, manage operations, counsel employees

leadership (vs management)

establish mission, set vision, motivate stakeholders, network, determine future strategy, be a good spokesperson

Systems Theory

measures workplace effectiveness based on interaction between organization and its environment as open system

Patient Centered Management

systems approach, addressing root causes of disease, 

social determinants of health; patient engagement, collaboration, cultural competency 

(responsiveness)

internal domains

financial performance, patient satisfaction, budgeting, staffing, new service development

external domains

competitors, financing, licensure, community demographic needs, stakeholder demands

coinsurance

amount of $, usually a percentage of costs, an insured person must pay for a covered service 

ADVERSE SELECTION

tendency of consumers w high disease risks or costly medical conditions to systematically select health insurance plans w comprehensive coverage

LOADING FACTOR

portion of price of health insurance associated w insurance company's cost of doing business like admin costs/profit

ACTUARIALLY FAIR PRICE

portion of a health insurance premium based on the probability of service use and the service cost

Moral Hazard

insurance hikes increases consumption of services by making people less sensitive to price then excess service use results in higher premiums and higher healthcare prices

mission statement

IS ENDURING, overall purpose and reason for existence

organizational objectives

quantitative targets that the organization must meet to achieve its goals (e.g. to maintain a financial reserve of at least 2.5 % but no more than 5 % of each year’s annual budget)

indirect costs

overhead: utilities, human, resources, staff

direct costs

what costs are traced to a particular product/service (supplies/salaries)

variable costs

change as volume changes (supplies, hourly, employees)

operating budget

revenue & expenses

theory x

employees are unmotivated and need managers’ direction (extrinsic rewards)

theory y

employees are industrious and managers provide resources to facilitate work (intrinsic rewards)

factors addressing job pricing

specialized skills and knowledge, experience, equity within the organization,

who are managers

presidents, CEOs, directors (finance, medical, operations)

who is responsible for monitoring and carrying out the organization's daily operations?

staff

who hires, evaluates, and determines the salary of the CEO?

board

who prepares the organization's annual budget?

staff

who hires, evaluates, and determines the salaries of the organization's staff (below the CEO)?

staff

who approves the org’s annual budget

board

who determines the organization's mission and vision?

board

who plans and leads the organization's fundraising efforts?

staff

why are citations important

documentation, acknowledgment, directing/linking

what’s a complementary good or service

needles and any medication that needs to be administered with needles

what’s health insurance 

method of pooling financial risk so that one person’s loss is shared across many people

how do providers get reimbursed

reimbursement from insurer, not from the patient

• form of fee-for-service

• bundled pmts per case

• capitation per patient per year

why would patients benefit from risk pooling

limited financial risk, peace of mind, ability to obtain medical care they otherwise couldn’t affor

why would insurers benefit from risk pooling

they profit when premiums collected exceed provider reimbursement, admin costs, and interest earned on premium funds before paid out

why would providers benefit from risk pooling

increased demand for health care service and regular payments

how many people are uninsured in the US

8%

what percent of people have private insurance

2/3

what percent of people have public insurance

36%

which type of health insurance is subsidized by the federal government

employer-sponsored, individual market, medicaid/medicare/CHIP

who pays the majority of premiums for employees’ health insurance

employers

why is employer payment of insurance premiums enticing to employees

its not taxable to employees

why was insurance like a one-legged stool before the ACA

a premiums death spiral occurs where there’s no incentive for healthy ppl to enroll, healthy ppl drop out, premiums increase, and then again no incentive to enroll

the ACA’s 3 legged stool components

government responsibilities, carrier responsibilities, enrollee responsibilities

how are premiums set

admin costs and profit combined with estimated annual cost of care for covered pop

what drives premium increases

• inflation

• hospital market

• increased utilization of special drugs

what’d the inflation reduction act do

enhanced subsidies to significantly cut premium payments

if premium subsidies expire, who will be hardest hit

lower-income enrollees

gross margin per enrollee

amount by which total premium income exceeds total claims costs per person over a specific period

medical loss ratio

percent of premium income that insurers pay out in the form of medical claims; what is left for admin costs and profit

what has doubled since 2017

the number of ACA marketplace enrollees receiving premium tax credits

what’s the predominant reimbursement model

fee-for-service

how’s moral hazard mediated

insurers use utilization management to control “excess” service use 

what type of market are physicians in

monopolistic competition: many sellers but not perfect comp

why are physicians selling their practices

less costs, more protection, more bargaining power

Theory Z

employees are motivated if they’re involved in and committed to an org e.g. viewing employees as a holistic view of people

price sensitivity (elasticity)

having insurance decreases the extent to which changes in … (health econ terms)

loading factor

portion of the price of health insurance associated w the insurers admin costs and profits

charge(s)

“list price” for a HC service (amount charged by provider w no discounts

staffing

recruiting developing, retaining an org’s workforce

decision-making

weighing pros and cons of alternative actions

risk pool

group of individuals w each member paying the same amount for health insurance

risk aversion

individual’s unwillingness to take chances bc of possibility of loss

organizational culture

shared beliefs, attitudes, and behavior that dictate the way things are done

benefits examples

paid leave, health insurance, and flexible spending accounts

adverse selection

tendency of consumers w high disease risks or costly medical conditions to buy insurance w comprehensive coverage

financial intermediary

a health insurers role in paying for HC services

value-based care

type of physician reimbursement where provider payment is linked to care quality

actuarially fair price

portion of a health insurance premium based on the probability of service use/cost

fee-for-service

type of physician reimbursement that provides set dollar amount for each service that a patient received, after care is provided (incentives volume)

organizing

designating reporting relationships an responsibilities

capitated rate / capitation

type of physician reimbursement that provides an upfront fixed amount per patient regardless of service use

co-insurance

amount of money, usually a % of medical costs an insured person must pay

direct services

hc services provided to individual ppl and traditionally paid by insurance

non direct costs

products and services that support health that aren’t usually paid by insurnace

nonexempt

managed care (utilization management)

insurance model that involves gatekeeping such as prior authorization and referrals

controlling

monitoring performance and taking corrective action

burnout

symptoms reported by over half of US hc workers characteristized by a high degree of emotional exhaustion and low sense of personal accomplishment

planning

setting priorities and performance targets

systems theory

modern management theory focusing on relationship btwn an org and its environment

midlevel practitioners: NPs / PAs

type of hc worker w greatest expected percent increase in demand over the next 10 years

concept that inputs (like income) are used in higher quantities, their effect on the output decreases (such as health status)

modern management theory

systems theory & patient centered management

ex officio

serve on board as representative and bridge btwn day-to-day employees and the board

• CEO can be this

• having a position bc of another position you had

vice-chair duties

step-in for president, support pres,

vice chair operations

manage day to day operations, financials, administrative tasks, oversee clinical sector