Health Care

2. Identify factors influencing today’s health care system.

3. Discuss the economic realities of U.S. health care.

4. Identify the major forms of reimbursement for health care.

5. Describe the U.S. health care system.

State of complete physical, social, and mental well-being; not merely the absence of disease or infirmity, as defined by the World Health Organization (2008). Health is a resource for everyday life, not the object of living. It is a positive concept emphasizing social and personal resources as well as physical capabilities.

Health care system

All of the structures, organizations, and services designed to deliver professional health and wellness services to consumers

Health care network

Refers to interconnected units that are owned by the institution or have cooperative agreements with other institutions to provide a full spectrum of wellness and illness services

Health Maintenance Organization (HMO)

Geographically organized system that provides an agreed-on package of health maintenance and treatment services

Medicare

Health insurance program for people aged 65 and older or under age 65 with certain disabilities or any age with end-stage renal disease

Medicaid

Joint federal and state assistance program designed to pay for medical long-term care assistance for individuals and families with low income and limited resources

Private agencies

Private agencies have voluntary governing bodies. They are not administered or governed by the U.S. government. Private agencies are required to meet state licensing requirements and regulations related to the area of their governing authorities. Private agencies are for profit or not for profit.

For-profit organizations

Organizations with stated financial structures that include profit goals and tax liabilities

Not-for-profit organizations

Organizations with financial structures that project financial goals with particular tax and legislative protection or shelters

Preferred provider organization (PPO)

Managed care company that contracts with health care providers (both physicians and hospitals) and payers (self-insured employers, insurance companies, or managed care organizations) to provide health care services to a defined population for predetermined fixed fees

Centers for Medicare & Medicaid Services (CMS)

Formerly known as the Health Care Financing Administration, the federal agency that administers Medicare, Medicaid, State Children’s Health Insurance Program (SCHIP), and several other health-related programs

Managed care

Linkage between the financing and delivery of services in such a way as to permit payers to exercise control over the delivery of services

Continuum of care

Matching an individual’s ongoing needs with the appropriate level and type of medical, psychological, health, or social care or service within an organization or across multiple organizations

Veterans Health Administration

The mission of the Veterans Healthcare System is to serve the needs of America’s veterans by providing primary care, specialized care, and related medical and social support services. To accomplish this mission, the VHA needs to be a comprehensive, integrated health care system that provides excellence in health care value, excellence in service as defined by its customers, and excellence in education and research, and needs to be an organization characterized by exceptional accountability and by being an employer of choice

World Health Organization (WHO)

Specialized agency of the United Nations (UN) that acts as a coordinating authority on international public health. Established in April 1948 and headquartered in Geneva, Switzerland, the agency inherited the mandate and resources of its predecessor, the Health Organization, which had been an agency of the League of Nations.

HEALTH

With the advent of health care delivery services organized under hospitals and care-giving facilities in the early nineteenth century, there has been movement toward standardizing care and financial practices within these institutions. It was not until the early twentieth century that hospitals began a pay-for-service financial plan. In this arrangement, the patient pays for services received. Insurance companies paid for the services rendered by most institutions. As the cost of health care in the United States rose exponentially, insurers began exploring more cost-effective ways to pay for health care. This has resulted in the health care plans, insurance plans, and federal plans that exist today. This change in reimbursement for health care services has dramatically affected all aspects of health care delivery in the United States driven by changes in Medicare reimbursement.

This has also affected the way nursing care is provided. For example, today, patients who are hospitalized have a much higher acuity than they did 20 years ago. Today, the norm is for many patients to be treated at home or in ambulatory care settings; only the critically ill remain in the hospital. Nursing has been expected to meet these challenges both in acute care and in home care. Today there are more ambulatory services, shorter inpatient stays, and an increase in care for chronic illnesses. The greatest challenge facing the U.S. health care system is the high cost of care and services. Technology enables the survival of premature infants weighing 2499 g or less. Some of the infants are kept alive with life support, which may include ventilators and/or feeding tubes. These infants may have a lifetime connection with pediatricians, nurses, specialists, and therapists. Many of them are placed in early intervention programs, whereby the nurses and therapists visit the child and family in the home setting. Once these “preemies” are 3 years old, they are placed in preschool programs for the handicapped. This is just one isolated example of the trend of health care in the United States. Health care in the United States is paramount, but at what expense? At an insurmountable expense. So … not only are the elderly living longer, the preemies are kept alive on life support. Individuals in severe motor vehicle accidents are air lifted to trauma centers and kept alive. What is the cost to the families and to the nation? The costs effect employers, health care providers, the government, and the public sector.

FACTORS THAT INFLUENCE THE FINANCIAL BURDEN OF HEALTH CARE IN THE UNITED STATES

There are numerous factors that influence the continuing financial burden of health care within the United States.

PRIVATE INSURANCE

The majority of insured Americans received health care insurance through their place of employment. The focus of such coverage has moved from the straight fee-for-services rendered model to managed health care. Managed health care organizations provide for both the delivery and the financing of health care for their members. The principal force behind the movement away from fee-for-service was the belief that health care costs can be controlled by “managing” the way in which health care is delivered and used.

The foundation of the managed care organization is the primary care provider (PCP). The PCP can be a physician or a nurse practitioner. This provider serves as the gatekeeper to coordinate and manage the patient’s use of resources and referrals and protects the patient from unnecessary overtreatment.

HMOs deliver comprehensive health maintenance and treatment services for a group of enrolled individuals. Several models of the HMO structure have evolved. The group model is where practitioners employed by the insurer spend all their time caring for patients of that particular HMO. An example of this model is the Kaiser-Permanente Health Care System. Another model is Independent Practice Associations (IPAs) where independent practitioners (not employed by the HMO) provide care for HMO members and are reimbursed for that care. Practitioners in an IPA contract may be restricted to caring only for members enrolled in that IPA, but some contracts allow practitioners to provide for nonmembers as well. In a network model, HMOs contract with individual practitioners and practitioner groups for both primary and specialty services. In a capitation system, each provider receives a flat annual fee for each patient regardless of how often services are used. Box 6-1 provides various types of HMOs.

Box 6-1 TYPES OF HEALTH MAINTENANCE ORGANIZATIONS (HMOs)

Staff model	Self-contained organization
Staff model	Providers are employees of the HMO
Group model	Contractual agreement with multispecialty physician groups to deliver care for group
Network model	Contractual agreements with physician practice groups
Independent practice association	Contractual agreements with a wide variety of care providers
Independent practice association	Members have greater choice
PPO	Network of providers that provides care to group

Modified from Grohar-Murray, M. E., & DiCroce, H. R. (2003). Leadership and management in nursing (p. 11). 3rd ed. Upper Saddle River, NJ: Prentice Hall.