Chapter 1 health care system questions

1.What is the primary objective of a health care delivery system?

The primary objective of a health care delivery system is to provide cost-effective, quality health care services to all individuals

2. What is the primary reason for employers to purchase insurance plans to provide health benefits to their employees?

The United States does not have a universal health care system covering all citizens. Health insurance is primarily employer-based. Employers purchase health insurance plans as a fringe benefit for their employees. Health insurance protects employees against the high cost of health care services.

what is managed care

Managed care is a system of health care delivery that seeks to achieve efficiencies by integrating the basic functions of health care delivery and employs mechanisms to control utilization of medical services and the price at which the services are purchased.

4. What are the 10 characteristics of the U.S. health care system?

(1) No central governing agency, little integration and coordination; (2) technology-driven and focused on acute care; (3) high on cost, unequal in access, and average in outcome; (4) quasi/imperfect market conditions; (5) government as subsidiary to the

private sector; (6) market justice vs. social justice: conflict through health care; (7) multiple players and balance of power; (8) quest for integration and accountability; (9) access to health care selectively based on insurance coverage; and (10) legal risk influences practice behavior

5. Why is the U.S. health care market referred to as “imperfect”?

The U.S. health care market is imperfect because it does not meet the classical criteria of a free market: (1) The health plans acting as intermediaries for the patients typically function as buyers of health care services. (2) Patients lack the information necessary to make prudent decisions. They generally do not know which new diagnostic methods, intervention techniques, and drugs are available. Information on price and quality is also extremely difficult to get. (3) Prices are often set by the health plans. They are not determined by the interaction of the forces of supply and demand. (4) The consolidation of buying power into the hands of private health plans is forcing providers to form alliances and integrated delivery systems on the supply side, thus restricting competition at the individual level. (5) Health insurance shields patients against the cost of health care. Health insurance does not always serve the purpose of true insurance, which is to protect against catastrophic risks. For basic and

routine care, health insurance acts as prepayment for health services. There is a moral hazard that once enrollees have purchased health insurance, they will utilize health care

services. (6) The utilization of health care is generally determined by need rather than price-based demand. Providers can often induce demand for their own financial benefit.

Discuss the intermediary role of insurance in the delivery of health care

The delivery of health care should be viewed as a transaction between the patient and the provider. However, the insurance function introduces a third party into this transaction. In free markets, the consumer makes purchasing decisions based on the prices and quality of goods and services. But health insurance insulates the consumer from the cost of health care. Hence, there is an artificial increase in the demand for health care services. Providers are sometimes restricted from delivering services that are not covered. At other times, they can induce demand artificially simply because insurance will pay for the services.

7. Who are the major players in the U.S. health services system? What are the positive and negative effects of the often-conflicting self-interests of these players?

The key players in the system are the physicians, administrators of

health service institutions, insurance executives, large employers,

and the government. Each player has economic self-interests to

protect. The conflicting self-interests of the various players produce

countervailing forces within the system. One positive effect of these

opposing forces is that they prevent any single entity from

dominating the system. On the other hand, they also make it

difficult to achieve system-wide reforms, particularly cost

containment.

what main roles does the government play in the U.S. Health services system?

The government is a major financier of health care delivery through the Medicare and Medicaid programs. The government determines eligibility criteria as to who can receive services under these programs; it also determines the reimbursement rates that providers will receive for rendering services to Medicaid and Medicare patients. In order to render services to Medicaid and Medicare patients, health care facilities must be certified. These organizations must comply with the standards of participation formulated by the government. The government also regulates the health care industry through licensing of personnel and health care establishments.

what is the difference between national health insurance (NHI) and a national health system (NHS)?

National health insurance is a tax-supported mechanism in which the government guarantees a basic package of health services to all citizens. The government finances health care through tax dollars, but the actual care is delivered by private providers. In

a national health system, in addition to financing a basic health package, the government also manages the infrastructure for the delivery of medical care. Under such a system, most of the medical institutions are operated by the government; health care providers, such as physicians, are government employees. Essentially, a national health system is a national health insurance program, but it goes one step further in managing the infrastructure as well

What is socialized health insurance (SHI)

In a socialized health insurance system, health care is financed through government mandated contributions by employers and employees. Health care is delivered by private providers

What is the purpose of the system’s framework? Name and define the main elements of the systems framework.

The systems framework is used to help understand the structure of health care services in the United States, which is based on several foundations; to provide a logical arrangement of the various components; and to demonstrate a progression from inputs to outputs.

• System foundations: cultural beliefs and values; historical developments

• System resources: human and nonhuman resources necessary

• System processes: the continuum of care and special populations

• System outcomes: critical issues and concerns about health service’s accomplishments relative to its primary objective; change and reform