Health Care Systems Exam 2

What 6 factors led to the growth of hospitals in the U.S.?

1. Advances in medical science

2. Development of technology and surgical services

3. Advances in medical education

4. Development of professional nursing

5. Growth of health insurance

6. Government intervention

What is the difference between in patient vs out patient care?

Inpatient care is when a patient stays overnight in a hospital for treatment, while outpatient care involves same-day care

What are key features and requirements for a hospital to operate and provide care to patients?

• An institution with at least 6 beds whose function is to deliver patient services including diagnostics and treatment

• Must be licensed, have organized physician staff, and provide continuous nursing services supervised by RNs

What is the difference between a medical center and hospital/health system?

• Medical center: hospitals that offer specialization and a large scope of services

• Hospital/health system: multihospital chain that provides a variety of health care services

Describe the evolution of hospitals by the 5 dominant functions

1. Primitive institutions of social welfare: almshouses

2. Distinct institutions of care for the sick: public and voluntary institutions

3. Organized institutions of medical practice: medical science and technology

4. Advanced institutions of medical training and research: research between hospitals and universities

5. Consolidated systems of health services delivery: organized integration, service diversification

What key factors led to hospital downsizing in the US?

Shift from inpatient to outpatient utilization, loss of revenue from unaffiliated outpatient services, changes in reimbursement, impact of managed care(most significant)

Define discharges

# of overnight patients a hospital serves in a given time period; includes newborns and deaths

Define inpatient days

a night spent by a patient(patient day)

Define average length of stay

total # days of care or discharges; indicator of severity of illness and resource use; highest in federal hospitals

Define capacity

How many patients a hospital can hold; determined by # of beds and staff

Define average daily census

average # of beds occupied per day

Define occupancy rate

percent of capacity occupies(average daily census/# of available beds or capacity) * 100

Define how hospitals are classified by ownership

Public, voluntary(privately owned, for the community), or proprietary(investor-owned)

Define how hospitals are defined by length of stay

Short stay(>25 days), long stay, or LTCHs(complex medical needs; must meet Medicare guidelines)

Define how hospitals are defined by type of service provided

General, speciality, psychiatric, rehabilitation, children’s

Define how hospitals are defined by public access

Community or non-community

Define how hospitals are defined by location

Urban or rural

Define how hospitals are classified as teaching

Hospitals with at least 1 graduate residency program approved by the AMA

What is a Critical Access Hospital?

A designation given to rural hospitals that qualifies them for cost-plus reimbursement; less than or equal to 25 acute care beds; originated from the Medicare Rural Hospital Flexibility Program

What changes did the ACA make that affected physician owned and nonprofit hospitals?

• Nonprofit hospitals must limit billing and collection actions

• Limit charges according to financial assistance policy

What is the Board of Trustees responsible for in a hospital?

Legally responsible for operations, establish mission/long-term direction, appoint and evaluate CEO

What is the CEO responsible for in a hospital?

Carries out mission and objectives, day-to-day operations

What is the Magnet Recognition Program of the American Nurses Credentialing Center?

Designation given by the American Nursing Credentialing Center; recognized nursing excellence; helps retain well-qualified nurses

What is the difference between licensure, certification, and accreditation

• Licensure: hospital must be licensed to operate

• Certification: not necessary to operate, but required for Medicare and Medicaid participation

• Accreditation: joint commission

What are some ethical dilemmas that hospital administration/providers face in a hospital setting?

Life/death, research/experimental medicine, complex circumstances requiring advanced tech

List examples of how ethical situations are handled in a hospital setting

• Patient Self-Determination Act of 1990: inform patient of their rights upon admission(confidentiality, informed consent, right to refuse treatment, etc)

• Advance Directives: Do Not Resuscitate, living will, durable power of attorney(person appointed by patient to make decisions)

What is Long Term Care (LTC), and what types of services are provided in a LTC setting?

For people with chronic illness or disability; mostly to assist with activities of daily living

What is the role of area agencies on aging(AAA)?

Federally funded senior service hubs

What are Adult Day Services?

Non-residential facilities that provide health, social, and support services

Who pays for LTC services in a community setting?

Private out of pocket payments, Medicaid

Describe the type of services provided in Retirement Communities

Provides community for older adults without having the hassle of a larger home to manage

Differentiate assisted living and skilled nursing care (SNC)

Assisted living provides for any adults over 18 who have physical and mental impairments; skilled nursing care is for frail people who do not need hospital level care but need more than other places of care

What is the PACE program?

All-Inclusive care for the Elderly Programs; contracted with Medicare and Medicaid to provide broad range of services for nursing home care

What is hospice care, and who can benefit from it?

Comfort care provided at the end of a person’s life. Does not seek to improve or treat condition

Who pays for hospice care?

Medicare, Medicaid, private insurers

What are Continuing Care Retirement Communities?

A type of housing community for older retired adults; usually if a person decides to live in a CCRC, they agree to stay for the duration of their life

What is the purpose of insurance?

Protects covered beneficiaries against economic risk from healthcare events ranging from everyday to catastrophic needs

Define premium

ongoing monthly amount that the person pays for insurance coverage

Define deductible

the amount of services that the person must pay on their own before the insurance will start paying for healthcare services

Define copayment

a set price patients pay at each medical care visit of for each prescription medication

Define coinsurance

similar to copayments; patient pays a percent of negotiated cost rather than a set amount

What is Moral Hazard?

When there is an ample supply of a resource(i.e. health care services), individuals tend to overuse the resource

How does an insurance company manage risk?

Risk rating to determine how much the company will charge the next year

Define risk rating

used to assess how much resources any individual may use under their plan

How do premiums differ based on risk?

High risk=high premium

What is experience based vs. community based vs. adjusted community based risk rating?

• Community: people within the same pool pay the same OOP costs; high risk individuals paired with low risk

• Adjusted: limits the amount of payments the insurer has to pay out beyond what they were initially paid to and the amount of profits

What are potential risk management problems for insurers?

Moral hazard, adverse selection, supplier induced demand

Define adverse selection

people with higher than average risk of needing health care are more likely to seek insurance; raises premiums for future policyholders

How does ‘Supplier induced demand’ create risk problems for insurers?

A person paid for a service determines how often the service is provided-conflict of interest (e.g. physicians)

What strategies do insurers use to avoid different types of risk listed above?

Cost-share with patients, group policies, coverage limits, coordination of benefits(applies when a loss is covered by 2 or more insurance plans)

What are the eligibility requirements of the Medicare program?

• Seniors over 65 who paid or whose spouse paid Social Security taxes for at least 10 years

• Persons under 65 with permanent disabilities

What benefits are provided under Medicare Part A?

inpatient hospital stays, skilled nursing facilities(deductible + coinsurance), home health visits, hospice care

What benefits are provided under Medicare Part B?

physician visits, outpatient services, preventive services, home health visits

How is Medicare Part A funded?

 payroll tax

How is Medicare Part B funded?

general revenues, premiums paid by Medicaid Beneficiaries

What is the patient cost share like in Part A?

 $1,676 deductible and coinsurance for inpatient hospital stays and skilled nursing facilities

What is the patient cost share like in Part B?

$257 deductible, 20% coinsurance except for annual wellness visit and some preventative services

What drugs are covered under Part B?

Drugs used with DME, most injectables given by a provider, parenteral and enteral nutrition, immunosuppressive drugs for organ transplant, clotting factors, IVIG, flu, pneumococcal, hepatitis B shots

What is Medicare Part C, and how does it differ from traditional Medicare Part A/B/D?

Can enroll in a private health plan while receiving all Medicare covered benefits

When does someone enroll for Medicare coverage?

• General: within 3 months before or after turning 65

• Part C and D: yearly enrollment that starts October and goes through December

• Switching plans: takes place throughout the year

What are the major provisions of the Medicare Part D prescription drug benefit?

Outpatient prescriptions

What are the different coverage phases in Part D?

• Deductible phase($0-590): coverage may not begin until a deductible has been met

• Initial coverage($2000): after the deductible phase, patients are subject to normal copayments and coinsurance amounts

• Catastrophic coverage: after leaving the coverage gap, patients are responsible for 0% of drug costs

What is the MTM program benefit in Part D?

Must offer Comprehensive Medication Review, quarterly targeted medication reviews, consultations, must target beneficiaries and prescribers

What are the eligibility requirements for MTM benefits?

Have multiple chronic diseases, have filled multiple covered drugs, be likely to incur annual costs that exceed $1620

What are the different types of Medicare supplement policies, and what do they cover?

Medigap coverage: provided by private insurance companies and partially covers Medicare Part A and B cost sharing requirements, including deductibles, copayments, and coinsurance

What is Medicaid?

A public insurance program that provides health coverage to low-income families and individuals

Who is eligible for Medicaid?

• Children through age 18 in families with income below 138% of the federal poverty line (FPL)

• Pregnant women with income below 138% of FPL

• Parents whose income is within the state’s eligibility limit for cash assistance that was in place prior to welfare reform

• Most seniors and persons with disabilities who receive cash assistance through the Supplemental Security Income (SSI) program

Describe the roles of state and federal governments in financing and administering Medicaid?

The federal government matches at least 100% of what a state spends on Medicaid; the federal government pays an average of between 57 – 60% of Medicaid program costs and as high as 75% in some states. States have large discretion over who is eligible and what services are covered. Therefore, states largely determine how much federal subsidies they will/are willing to receive

Describe the mandatory and optional benefits provided under Medicaid?

• Mandatory: in/out-patient hospital services, physician services, nurse services, home health, family planning, screening and diagnostic testing, lab and x-rays, health centers

• Optional: Rx drugs, hospice, transportation services, some substance abuse services, some mental health services, home and community based care for certain chronic impairments, prosthetics, glasses, therapies

What was the reasoning behind the proposed Medicaid expansion under the ACA?

To assist people in the coverage gap between who is eligible for Medicaid and who can afford private insurance

What changes were made to the Medicare and Medicaid programs by the ACA?

Higher premiums for higher income, reduced payments for hospital readmissions, extends Trust Fund solvency, closes Part D coverage gap by 2020, covers preventative services, Medicare Advantage adjustments, payment reforms

Describe the purpose of the Medicare Star Ratings?

To measure how well Medicare Part D and Advantage Plans perform on a scale of one to five stars

What is the big idea behind Managed Care (MC)?

An organized approach to deliver comprehensive healthcare services to enrolled members; through efficient management of services and negotiation of prices with providers

How is Managed Care different from indemnity insurance?

Indemnity insurance provided perverse incentives for consumers and providers, had no emphasis on preventive care, had poor coordination and integration of care

What forces led to the creation of Managed Care?

Early managed care showed lower utilization, lower expenditures and premiums, and no documented diminution of quality

Once Managed Care was introduced, what sort of backlash was seen and what happened following that?

• Employees faced barriers to free choice of providers

• Employees did not see lower out-of-pocket costs

• Physicians reacted negatively to utilization management and lower reimbursement

What are the different cost control mechanisms used by Managed Care to limit expenditures/cost?

• Choice restriction(network)

• gatekeeping(referrals needed, PCP)

• case and disease management

• utilization review

• practice profiling

• pharmaceutical management(formularies, tiered pricing)

What are the different types of Managed Care Organization Models, and how do they differ?

• HMO

• EPO

• PPO

• POS

What is an HMO?

health maintenance organization; closed network, very low copay, salaried physicians, gatekeeper required

Describe a staff model HMO

classic managed care; physicians are employees of HMO

Describe a group model HMO

HMO contracts with multi specialty physician group

Describe a network model HMO

HMO contracts with multiple group practices

Describe an IPA HMO

HMO contracts with facilities/physician organization(IPA), which in turn contracts with individual physicians and groups

What is an EPO?

exclusive provider organization; no gatekeeper, closed network

What is a PPO?

preferred provider network; no gatekeeper, tiered network, discounted fee for service

What is a POS plan?

hybrid of HMO and PPO; capitation, utilization controls, open access option available at the point of service with higher cost sharing

Are more consumers using PPO's or HMO’s?

PPO’s

Describe MCO accreditation and quality control.

• NATIONAL COMMITTEE FOR QUALITY ASSURANCE; voluntary

• Healthcare Effectiveness Data and Information Set(HEDIS)

What are some of the newer models of Managed Care, i.e. Accountable Care Organizations (ACOs)?

Accountable Care Organizations (ACOs) are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to their Medicare patients

What changes were made to Managed Care by the ACA?

Essential health benefits must be provided, minimum medical loss ratios

What is health disparity?

Care differences based on culture that are potentially avoidable; patients that are vulnerable in our current healthcare system

What are the different vulnerability factors that can influence a patient’s health?

Predisposing, need, enabling

How does racial and ethnic disparities impact health status?

Life expectancy, health insurance, smoking rates, infant mortality, preventative care utilization

What are the health concerns of America’s women?

• Underrepresented in clinical trials

• Suffer greater morbidity and poorer health outcomes

• Higher annual charges for healthcare

• More likely to delay care

• Higher death rate due to heart disease and stroke than men

What are the health concerns of America’s children?

• Vaccination rates differ depending on socioeconomic factors

• Poor health impacts children’s social and educational needs

What programs are designed to address the health concerns of women and children?

• Office of Women’s Health, National Action Plan on Breast Cancer, Women’s Health Initiative

• Vaccine clinics, personal and preventative services, abuse/neglect prevention, nutritional education, rehabilitation services

What are the challenges faced by the homeless and the migrants when it comes to access to health care?

Low access to federal services; cannot use programs without an address; low rates of primary care and high rates of ED utilization