Economic Influences in Health Care

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Lesson 6: Economic Influences

  • Copyright: 2022 Assessment Technologies Institute, L.L.C. All rights reserved.

Learning Objectives

  • Explain the effect of health policy at the local, state, and national levels on public health practices.
  • Discuss the strengths and weaknesses of the U.S. health care delivery system.
  • Analyze health care financing, spending, and payment systems.
  • Examine the factors that influence resource allocation in health care delivery.
  • Appraise the impact of the most recent U.S. health care reforms on public health.
  • Evaluate the cost and effectiveness of primary, secondary, and tertiary levels of prevention.

Health Policy

  • Definitions:
    • Health Policy: Comprises regulations, laws, actions, and decisions regarding health.
  • Impact: Affects health at diverse levels: local, state, and national.
  • Examples:
    • Federal Level: Affordable Care Act (ACA)
    • State Level: Medicaid programs
    • Local Level: Health department regulations and initiatives.

Public Sector

  • Characteristics:
    • Health care is delivered by government entities.
    • Financing is sourced from taxes.
  • Strengths:
    • Government funding boosts access to health care services.
  • Weaknesses:
    • Funding is often limited.
    • Bureaucratic processes can complicate service delivery.

Private Sector

  • Characteristics:
    • Comprises agencies, institutions, or companies that are owned by individuals or groups.
  • Strengths:
    • Drives innovation and research initiatives.
    • Offers private insurance options.
  • Weaknesses:
    • Limited funds and resources can present challenges.
    • Workforce limitations can impede service quality.
    • Profit-driven funding may affect service delivery (Herzlinger, 2006).

Costs of Health Care

  • Overview:
    • Health care costs are on a continuous rise.
  • Concerns:
    • Provider shortages, particularly in primary care sectors.
    • Increasing costs associated with medical education.
    • Insufficient funding availability (Yanushevsky, 2021).

Health Care Quality

  • Measurement:
    • Utilizes Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS).
  • Requirements:
    • Participation is mandatory for institutions receiving federal funding.
  • Importance:
    • Acts as a leading key indicator of health care quality.
    • Data is collected through patient surveys.
    • Reimbursement rates are linked to the quality metrics derived from survey data.

Health Care Financing (1 of 2)

  • Major Programs:
    • Medicare:
    • Typically available for individuals over the age of 65 or those under 65 with disabilities.
    • Fully federally funded program.
    • Medicaid:
    • Insurance program aimed at low-income individuals.
    • Co-funded by both federal and state sources.
    • Children’s Health Insurance Program (CHIP):
    • Provides insurance coverage for low-income children who are not eligible for Medicaid.

Health Care Financing (2 of 2)

  • Affordable Care Act (ACA):
    • Objective: Designed to increase health insurance coverage across the United States.
    • Strengths:
    • Provides taxpayer-funded subsidies.
    • Enhances access to preventive care services.
    • Eliminates denial of coverage for pre-existing conditions.
    • Allows dependent children to stay on parent’s insurance until age 26.
    • Removes lifetime limits on health benefits.

Paying for Health Care

  • Key Terms:
    • Private Insurance:
    • Involves out-of-pocket costs paid by individuals.
    • Copay: A defined portion of healthcare costs that the individual is responsible for, paid at the time of service.
    • Deductible: The total amount that an individual must pay before insurance coverage starts.
    • Health Savings Accounts (HSA): Accounts that allow individuals to set aside a predetermined amount for out-of-pocket expenses, often funded through deductions from paychecks.