health care policy objectives review economic trends and consumer satisfaction review economic...
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Health Care PolicyHealth Care Policy
ObjectivesObjectives
• Review Economic Trends and Consumer Review Economic Trends and Consumer Satisfaction Satisfaction
• Review the components of Health CareReview the components of Health Care
• Compare Health Insurance PlansCompare Health Insurance Plans
Table 1.2National Health Expenditures Per Capita, 1986-2010
Calendar Year
Source: CMS, Office of the Actuary, National Health Statistics Group.
$2,477
$3,183
$3,698
$4,177
$5,039
$6,926
$8,228
$1,872
$5,757
$9,216
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
$10,000
1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
ActualProjected
National health spending per capita is projected to increase rapidly over the next decade.
0
20
40
60
80
100
1960 1970 1980 1990 2000
Calendar Year
Perc
en
t
Table 1.3Personal Health Care Expenditures by Source of Funds:
Selected Years 1960-2000
Source: CMS, Office of the Actuary, National Health Statistics Group.
Total Private
Total Public
$23.3 $63.1 $214.5 $609.3 $1,130.4
Over the last several decades, the public sector share of health spending has increased, while the share from out-of-pocket spending has declined.
55.2%
39.7% 27.1% 22.5% 17.2%
21.4%15.7%
11.5%
10.0%7.3%
21.4%
22.3%28.3% 33.4%
34.6%
2.0%
2.8%
4.3%5.0%
5.0%
11.5%16.9%
17.6%
19.2%
8.0%
11.9%
11.4% 16.8%
Dollars in Billions
Other PublicMedicareTotal Medicaid, SCHIP expansion and SCHIP
Out-of-PocketOther PrivatePrivate Health Insurance
Table 1.4Sources of Health Insurance Coverage for the
Under 65 Population, 1980-2000
Notes: ESI - Employer Sponsored Insurance. Any Private includes ESI and individually purchased insurance. Any government includes Medicare for the disabled population.
Source: Tabulations of the March Current Population Survey files by Actuarial Research Corporation, incorporating their historical adjustments.
Over the last two decades, private coverage has declined, public coverage has stayed about the same, and the uninsured have grown.
74%
83%
8%
15%
10%
0
10
20
30
40
50
60
70
80
90
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
ESI
Any Private
Medicaid
Any Government Uninsured
74%
69%
16%
14%
9%
Table 1.5Distribution of Personal Health Care Expenditures
by Type of Service, 1960-2000S
ervi
ce
Percent
Source: CMS, Office of the Actuary, National Health Statistics Group.
39.3%
47.3%
41.7%
36.5%
22.9% 21.9%
25.9% 25.3%
0.2%1.1%
2.1%2.9%
11.4%
5.6%6.6%
10.8%
3.6%
8.2% 8.6% 8.2%
22.5%
15.8%15.2%
16.4%
The share of health spending on home health and nursing homes has grown. Physician share has stayed about the same while the hospital share grew and then declined.
Table 1.8Concentration of Health Spending, 1980-1996
Note: Data for 1980 are from the National Medical Care Utilization and Expenditure Survey (NMCUES); for 1987, from the 1987 National Medical Expenditure Survey (NMES); and for 1996, from the 1996 National Medical Expenditure Panel Survey (MEPS).
Source: Berk, Mark and Alan Monheit, “The Concentration of Health Care Expenditures, Revisited,” Health Affairs March/April 2001.
Health spending remains highly concentrated on a small percentage of people. The top1% of people account for more than a quarter of all health spending.
Percent of People
Table 1.12Number of People Employed in Health Care, 1985-2001
Note: Not seasonally adjusted.
Source: Bureau of Labor Statistics, data extracted from web site at data.bls.gov/labjava/outside.jsp?survey=ee. Trends and Indicators in the Changing Health Care Marketplace, 2002 – Chartbook.
Number of people employed in health is growing.
6.3
7.88.2
8.58.8 9 9.2
9.5 9.7 9.9 10 10.1 10.3
0
2
4
6
8
10
12
1985 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Em
plo
ym
en
t in
Mill
ion
s
Health Services Employment as a % of Non-Farm Private Sector Employment
7.8% 8.6% 9.1% 9.4% 9.5% 9.5% 9.4% 9.5% 9.4% 9.3% 9.2% 9.1% 9.3%
Table 1.13Health Care Employment by Occupation, 1983-2000
Source: Dept. of Labor, Bureau of Labor Statistics. Current Population Survey.
Health care employment growth exceeded that of the general economy.
0 200 400 600 800 1000 1200 1400 1600 1800 2000 2200
Managers, Medicine & Health
Medical Scientists
Physicians
Dentists
Optometrists
Health Diagnosing Practitioners
Licensed Practial Nurses
Registered Nurses
Pharmacists
Dietitians
Respiratory Therapists
Occupational Therapists
Physical Therapists
Speech Therapists
Physicians' Assistants
Clinical Laboratory Technologists & Technicians
Dental Hygienists
Health Record Technologists & Technicians
Radiologic Technicians
Employment (Thousands)
1983 1990 2000
Percent Change 1990-02
32.0%
-75.4%
28.7%
14.8%
7.5%
39.4%
61.9%
56.5%
48.6%
23.8%
16.9%
21.6%
26.6%
-15.2%
30.4%
5.0%
24.6%
95.3%
332.2%
13.8% Total Employment
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Table 1.16HMO Enrollment by Ownership Status, 1981-2000
Note: HMO enrollment includes enrollees in both traditional HMOs and point-of-service (POS) plans through: group/commercial plans, Medicare, Medicaid, the Federal Employees Health Benefits Program, direct pay plans, supplemental Medicare plans, and unidentified HMO products.
Source: Trends & Indicators in the Changing Health Care Marketplace, 2002 -- Chartbook.
The proportion of HMO enrollees in for-profit plans grew over the past decade.
74.0%
53.8%47.8%
36.7% 36.3% 36.0% 36.5%
88.0%
46.2%
26.0%
12.0%
63.5%64.0%63.7%63.3%52.2%
0%
20%
40%
60%
80%
100%
1981 1985 1989 1993 1997 1998 1999 2000
% Non-Profit % For-Profit
Total Enrollment (in millions)
10.27 18.89 32.49 42.07 72.23 78.78 80.81 79.66
Table 1.17Concentration of Managed Care Enrollment, 1988-2000
Note: The largest national managed care firms include Blue Cross and Blue Shield plans, Aetna US Healthcare, Kaiser Permanente, United Health, and PacifiCare. HMO enrollment includes enrollees in both traditional HMOs and point of service plans.
Source: Trends & Indicators in the Changing Health Care Marketplace, 2002 – Chartbook.
Two-thirds of managed care enrollees are enrolled in the nation’s 10 largestmanaged care firms.
45.8
54.6 56.2
65.064.1 65.2 66.5
0
10
20
30
40
50
60
70
80
1988 1991 1994 1997 1998 1999 2000
Perc
en
t E
nro
lled
in 1
0 L
arg
est F
irm
s
Table 1.18Managed Care Enrollment by Type of Plan, 1984-2000
Source: Trends & Indicators in the Changing Health Care Marketplace, 2002 – Chartbook.
Mixed model HMO plans have shown rapid growth.
2.1 4.3 2.46.6
8 9.78.7 7
3.55.6 3.9
3.3 7.12.9
13.5 16.227.5
33.56.7
23.1
32.1
0.40.80
10
20
30
40
50
60
70
80
1984 1988 1992 1996 2000
En
rolle
es (in
mill
ion
s)
Staff Group Network IPA Mixed
31.4
38.8
63.3
80.1
15.1
NA19.5%23.3%43.6%13.6%
NA43.0%18.0%25.4%13.6%
17.3%41.7%10.0%24.8%6.2%
36.4%43.4%5.3%
13.7%1.2%
40.0%41.9%8.9%8.8%0.4%
MixedIPANetworkGroupStaff
Those over 65 and those with incomes under $20,000 spend a higher percentage of their income on health than other groups.
Source: Dept. of Labor, Bureau of Labor Statistics, Consumer Expenditure Survey.
Table 1.21Out-of-Pocket Spending for Health Care as a Percent of Income
by Age and Income Level, 2000
By Income LevelBy Age Group
12.9%
5.2%
3.3%2.7%
0
2
4
6
8
10
12
14
16
Under 35 35 to 54 55 to 64 65 andover
Per
cen
t o
f In
com
e S
pen
t o
n H
ealt
h
2.6%4.0%
6.2%
15.2%
0
2
4
6
8
10
12
14
16
Less than$20,000
$20,000 to$49,999
$50,000 to$69,999
$70,000and above
Per
cen
t of
In
com
e S
pen
t on
Hea
lth
Age GroupIncome Level
Table 1.22Growth in the Overall Consumer Price Index (CPI) and
Medical-Specific Consumer Price Index (MCPI), 1993-2001
Source: Dept. of Labor, the Bureau of Labor Statistics.
Medical prices have risen faster than overall consumer prices.
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
1993 1994 1995 1996 1997 1998 1999 2000 2001
CPI MCPI
Health Care PolicyHealth Care PolicyAlmost 45 million Americans were uninsured in 2003 (44.7 million under the age of 65)—growing by 1.4 million from the previous year and a total of over 5 million since 2000.
Both adults and children experienced significant decreases in the share with job-based coverage. The proportion of children with employer-sponsored insurance dropped from 62% in 2000 to 57% by 2003.
The 2001 recession, brief as it was, triggered a sharp downtick in job-based coverage and it continued to affect health insurance coverage even in 2003, as employment was slow to recover, job opportunities shifted, and family incomes declined.
“Health Insurance Coverage in America – Chartbook 2003” Kaiaser
Recent Findings on Public Attitudes Towards Patient’s Rights and Managed Care
Kaiser Foundation 2001
Health Care PolicyHealth Care Policy
Rank the following organizations, from highest to lowest, according the statement: “I have a favorable opinion of”
Airlines Banks Doctors Health Insurance Companies HMOs Hospitals Oil Companies Pharmaceutical companies Tobacco companies
Health Care PolicyHealth Care Policy
Health Care PolicyHealth Care Policy
In general, do you think managed care health plans are doing a good job or a bad job in serving health care consumers?
Health Care PolicyHealth Care Policy
In the past few years have you or someone you know:
Needed more information about how the health plan operates in order to choose among different plans?
Had difficulty getting a health plan to pay for an emergency room bill?
Had difficulty getting permission from a health plan or regular doctor to see a medical specialist?
Wanted to file an appeal to an independent reviewer when a health plan denied coverage for a particular medical treatment?
Had difficulty getting permission from a health plan or regular doctor to see a gynecologist?
Wanted to sue a health plan for malpractice?
Health Care PolicyHealth Care PolicyDo you think this issue is very important for the
President and the Congress to deal with? Making prescription drugs more affordable for people
age 65 and over Making Medicare more financially sound for future
generations Helping families with the cost of caring for an elderly or
disabled family member who needed long-term care Protecting patient’s rights in HMOs and managed care
plans Increasing the number of Americans covered by health
insurance
Which one of these would you say is the most important issue?
Health Care PolicyHealth Care Policy
ObjectivesObjectives
• Review Economic Trends and Consumer Review Economic Trends and Consumer Satisfaction Satisfaction
• Review the components of Health CareReview the components of Health Care
• Compare Health Insurance PlansCompare Health Insurance Plans
Health Care PolicyHealth Care Policy
Primary CarePrimary CarePreventive and Treatment measures
Often provided by a physician or nurse practitioner
Health Care PolicyHealth Care Policy
Secondary CareSecondary Care• Services available both in community
hospitals and physicians’ offices
• Surgeries
• Specialists, e.g.. Cardiologists, GI, Derm
Health Care PolicyHealth Care Policy
Tertiary CareTertiary Care- Highly specialized care
- Often at large medical centers
Transplants
Open-heart surgery
Neonatal wards
Chemo- & Radiotherapy
Health Care PolicyHealth Care Policy
ConsumersConsumers
• US PopulationUS Population
• Minors, Aged, Disabled, OthersMinors, Aged, Disabled, Others
• Employed, Not-employed, working poorEmployed, Not-employed, working poor
Family Family
CaregiversCaregivers
Representatives of ConsumersRepresentatives of Consumers
• ActivistsActivists
• Associations - AARPAssociations - AARP
Health Care PolicyHealth Care Policy
Providers of CareProviders of Care
• PhysiciansPhysicians
• Nurses, PAs, Others (SW, Pharm, RDs, PTs)Nurses, PAs, Others (SW, Pharm, RDs, PTs)
• Diagnostic and Laboratory TechniciansDiagnostic and Laboratory Technicians
• Associations / Trade OrganizationsAssociations / Trade Organizations
Health Care PolicyHealth Care Policy
Institutions that Provide CareInstitutions that Provide Care
• Hospitals, Medical CentersHospitals, Medical Centers
• Specialty ClinicsSpecialty Clinics
RehabRehab
Drug / Substance AbuseDrug / Substance Abuse
• Long-term care facilitiesLong-term care facilities
• AssociationsAssociations
American Hospital AssociationAmerican Hospital Association
Health Care PolicyHealth Care Policy
Government : Federal, State, LocalGovernment : Federal, State, Local
• Regulatory RoleRegulatory Role
• Political Process - set regulations, respond to Political Process - set regulations, respond to electorateelectorate
• Reimbursement Reimbursement
Medicare, Medicaid (States)Medicare, Medicaid (States)
• Public Health SystemPublic Health System
Health Care PolicyHealth Care Policy
Insurance GroupsInsurance Groups
• BluesBlues
• Associations / Trade OrganizationsAssociations / Trade Organizations
Health Care PolicyHealth Care Policy
Support IndustriesSupport Industries
• Pharmaceutical Companies and DistributorsPharmaceutical Companies and Distributors
• Medical DevicesMedical Devices
• Medical EquipmentMedical Equipment
Health Care PolicyHealth Care Policy
EmployersEmployers
EconomistsEconomists
Judiciary; Legal SupportJudiciary; Legal Support
Information / Technology IndustryInformation / Technology Industry
• WebMD; WebMD;
Higher EducationHigher Education
Health Care PolicyHealth Care Policy
ObjectivesObjectives
• Review Economic Trends and Consumer Review Economic Trends and Consumer Satisfaction Satisfaction
• Review the components of Health CareReview the components of Health Care
• Compare Health Insurance PlansCompare Health Insurance Plans
Health Care PolicyHealth Care Policy
Concept Checks: Define HMO PPO Conventional Fee for Service Point of Service (POS)
How do they differ? Be prepared to describe the strengths
and weaknesses of each.
Health Care PolicyHealth Care Policy
Health Insurance PlansHealth Insurance Plans
Fee-for-ServiceFee-for-Service
Health Maintenance Organizations Health Maintenance Organizations (HMO)(HMO)
Individual Practice Association (IPA) Model HMOIndividual Practice Association (IPA) Model HMO
Preferred Provider Organizations Preferred Provider Organizations (PPO)(PPO)
MedicareMedicare
MedicaidMedicaid
Disability InsuranceDisability Insurance
Hospital Indemnity InsuranceHospital Indemnity Insurance
Long Term CareLong Term Care
Health Care PolicyHealth Care PolicyFee-for-ServiceFee-for-Service
Client may visit any physician, use any hospitalClient may visit any physician, use any hospital
Pay a premium each monthPay a premium each month
Deductible; after deductible provide a copayDeductible; after deductible provide a copay
Patient may need to submit billPatient may need to submit bill
Limited servicesLimited services
Preventive CarePreventive Care
Experimental; Home Health Care; Long-term care; Experimental; Home Health Care; Long-term care; PT; PT;
Health Care PolicyHealth Care PolicyHealth Maintenance Organization Health Maintenance Organization (HMO)(HMO)
• Pay a premium each monthPay a premium each month
• Receive ‘complete’ careReceive ‘complete’ care
• ‘‘Primary Care Doctor’ you must selectPrimary Care Doctor’ you must select
• Some preventive services covered, such as Some preventive services covered, such as well baby check ups, immunizationswell baby check ups, immunizations
• Care must be provided by HMO’s practice Care must be provided by HMO’s practice groupgroup
• Cannot self-refer to a specialistCannot self-refer to a specialist
• No claim forms to fill out / No claim forms to fill out / ● ● Small copaySmall copay
Health Care PolicyHealth Care PolicyPreferred Provider Organizations (PPO)Preferred Provider Organizations (PPO)
• Combination of a fee-for-service and HMOCombination of a fee-for-service and HMO
• Limits choice of doctors / hospitalsLimits choice of doctors / hospitals
• Has arrangements with doctors, hospitals, Has arrangements with doctors, hospitals, and other providers of care who have and other providers of care who have agreed to accept lower fees from the agreed to accept lower fees from the insurer for their services. insurer for their services.
• CopayCopay
• More expensive outside the networkMore expensive outside the network
Which Type Is Right for You?For each group, choose the statement 1 or 2 that
best describes how you feel:
Having complete freedom to choose doctors and hospitals is the most important thing to me in a health plan, even if it costs more.
Holding down my costs is the most important thing to me, even if it means limiting some of my choices.
I travel a lot or have children that live away from me and we may need to see doctors in other parts of the country.
I do not travel a lot and almost all care for my family will be needed in our local area.
Checkup on Health Insurance Choices
Which Type Is Right for You?For each group, choose the statement 1 or 2
that best describes how you feel:
I don't mind a health insurance plan that includes filling out forms or keeping receipts and sending them in for payment.
I prefer not to fill out forms or keep receipts. I want most of my care covered without a lot of paperwork.
In addition to my premiums, I am willing to pay for the cost of routine and preventive care, such as office visits, checkups, and shots. I also like knowing that I can get an appointment for these services when I want one.
Which Type Is Right for You?For each group, choose the statement 1 or 2 that
best describes how you feel:
I want a health plan that includes routine and preventive care. I don't mind if I have to wait for these services to be scheduled for an available appointment with my doctor.
If I need to see a specialist, I probably will ask my doctor for a recommendation, but I want to decide whom to go to and when. I don't want to have to see my primary care doctor each time before I can see a specialist.
I don't mind if my primary care doctor must refer me to specialists. If my doctor doesn't think I need special services, that is fine with me.
Which Type Is Right for You?
If your answers are mostly 1: You want to make your own health care choices, even if it costs you more and takes more paperwork. Fee-for-service may be the best plan for you.
If your answers are mostly 2: You are willing to give
up some choices to hold down your medical costs. You also want help in managing your care. Consider a health maintenance organization.
If your answers are some 1's and some 2's: You might want to look for a plan such as a preferred provider organization that combines some of the features of fee-for-service and a health maintenance organization.
Which Type Is Right for You?
The differences among fee-for-service plans, HMOs, and PPOs are not as clear-cut as they once were. Fee-for-service plans have adopted some
activities used by HMOs and PPOs to control the use of medical services.
And HMOs and PPOs are offering more freedom to choose doctors, the way fee-for-service plans do.
Health Care PolicyHealth Care Policy
Concept Checks: Define What are the distinctions between
Medicare and Medicaid? Where would you find information on the
inclusion of nutrition services under Medicare and/or Medicaid?
Health Care PolicyHealth Care PolicyMedicareMedicare
• Center for Medicare and Medicaid Center for Medicare and Medicaid Services (CMS) (formerly HCFA)Services (CMS) (formerly HCFA)
• Largest health insurance programLargest health insurance program
• 40 million Americans40 million Americans
• EligibilityEligibility
65 years of age or older65 years of age or older
Some disable persons < 65Some disable persons < 65
End-Stage Renal Disease with dialysis or End-Stage Renal Disease with dialysis or transplanttransplant
Health Care PolicyHealth Care PolicyMedicareMedicare
• Part APart A
Hospital InsuranceHospital Insurance
Funded by SSFunded by SS
• Part BPart B
Supplemental Medical InsuranceSupplemental Medical Insurance
Doctor appointmentsDoctor appointments
Other services and suppliesOther services and supplies
Funded by General Revenues and PremiumsFunded by General Revenues and Premiums
Health Care PolicyHealth Care PolicyMedicaidMedicaid
• Title XIX of the Social Security Act - law in 1965
• Administered by the States
Health Care PolicyHealth Care PolicyMedicaidMedicaid
• Eligibility
* Low income families with children
* Aged, blind, disabled individuals who meet criteria
* Infants born to Medicaid eligible pregnant women
* Children < 6 and pregnant women at < 133% of the
Federal poverty level
* Recipients of adoption assistance and foster care
* Certain Medicare beneficiaries
Health Care PolicyHealth Care PolicyMedicaidMedicaid
Medicaid is a state administered program and each state sets its own guidelines regarding eligibility and services. Read more about your state Medicaid program.
http://www.cms.hhs.gov/medicaid/consumer.asp
Health Care PolicyHealth Care PolicyMedicaidMedicaid
• Each of the States:
1. Establishes its own eligibility standards
2. Determines the type, amount, duration, and scope
of services
3. Sets the rate of payment for services; and
4. Administers its own program
Health Care PolicyHealth Care Policy‘‘Medigap’Medigap’
Insurance that covers expenses outside of Medicare
Health Care PolicyHealth Care Policy Health Insurance PlansHealth Insurance Plans
What the client gets billed depends on the What the client gets billed depends on the health care plan.health care plan.