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Health Policy Exam #2

Terms in this set (155)

- Capitation payments (per capita payments, or payments "by the head") are monthly payments made to a physician for each patient signed up to receive care from that physician—generally a primary care physician
(PCP)
- There is a shift of financial risk from insurers to providers
- Under fee-for-service, pts who require expensive services cost their health plan more than they pay in
premiums and the insurer is at risk and loses money while drs and hospitals that provide the care earn more
money
-Capitation is a 180 degree turn and frees insurers of risk by transferring risk to providers
----An HMO that pays drs via capitation has pays a fixed sum, no matter how many services are provided and the providers earn no additional money, yet spend a great deal of time and incur large office and hospital costs (In the long term, HMOs do want to limit services in order to reduce provider pressure for higher capitation payments.)
METHODS TO MITIGATE FINANCIAL RISK
- Offer fee for service for certain services and called "carve outs" as their reimbursement is carved out ans paid separately (i.e.Pap smears, immunizations, office ECGs, and minor surgical procedures)
- Risk-adjusted capitation will provide higher monthly payments for elderly patients and for those with chronic illnesses
PROS
-Capitation has potential merits as a way to control
costs by providing an alternative to the inflationary
tendencies of fee-for-service payment.
- Have Beneficial influence on organization of care.
- Capitation payments require patients to register with a physician or group of physicians
- The clear list of the population of patients in a primary care practice offers advantages for monitoring appropriate use of service and planning for these patients' needs.
- It explicitly defines, in advance, the amount of money
available to care for an enrolled population of patients,
providing better allocation of resources and innovation in developing better modes of delivering services.
- For a large group of PCPs size of the capitation payments provides influence and flexibility over how to best arrange ancillary and specialty services
BOOK:
-Reducing unnecessary diagnostic imaging and unused hospital beds.
- Drs in the US perform large numbers of inappropriate procedures and much of what constitutes "appropriate" standards of practice lacks proven efficacy
- Medicare costs are 2x as high in some cities i.e. Miami than in other metropolitan areas i.e. Minneapolis
----This difference is explained not by prices or degree of illness, but is related to the quantity of services provided
- The slope of the cost-benefit curve would become
more favorable if a system could eliminate those components of rising expenditures that have flat slopes (no medical benefit) or negative slopes (harm exceeding
benefit, as in the case of inappropriate surgical procedures or prolonged bed rest after strokes)
PPT:
-The "painless" route of making more efficient use of an existing level of resources.
-Painless cost control may be impeded by political, organizational, and technical obstacles.
-Painful cost containment is accomplished by sacrificing quantities of medically beneficial services which often means making "trade-offs" in services based on a cost effectiveness analysis.
-Cost effectiveness analysis measures the net cost of providing a service (expenditures minus savings) as well as the outcomes obtained (either one single measure like reducing the incidence of heart disease with a smoking cessation program or several outcomes).
-Trade-offs can have professional legitimacy only if it is clear that resources saved will be reinvested in services with greater cost-effectiveness.
-1st Medical School in the United States was University of Pennsylvania in 1765
----Curriculum emphasized the therapeutic powers of
blood letting and intestinal purging
----During this era other medical sects existed i.e. botanicas, "natural bonesetters," midwives, and homeopaths
----All groups were equal in dominance
-EARLY Medical Training
--Few regulations
--Could be achieved through an informal apprenticeship or going to a medical school
-- Most medical schools operated as small, proprietary establishments profiting their physician owner rather than as university-centered academic institutions
-MODERN Era (1890-1910): Medical Training
--In 1893, John Hopkins University's School of Medicine started a new era of medical education
---Implemented many features that are still a standard in medical education:
----- 4-year course of study at the graduate
school level
-----Competitive selection of students
-----Emphasis on the scientific paradigms of clinical and laboratory science, close linkage between a medical school and a medical center hospital, and cultivation of academically renowned faculty
--Flexner Report 1910 major event in modern reform
----The Carnegie Foundation for the Advancement in Teaching commissioned Abraham Flexner to perform an evaluation of medical education in the US
----(MORE INFO IN THE NEXT TWO SECTIONS)
--Homeopathic practitioners not considered "physicians"
--Osteopathy originated as a medical practice developed by a Missouri physician, Andrew Still, in the 1890s, emphasizing mechanical manipulation of the body as a therapeutic maneuver (and is still around today)
- At least one year of formal education after medical
school is required for licensure and most
physicians complete additional training to become certified in a particular specialty
- The first year of postdoctoral training was referred to as an "internship," with subsequent years referred to as "residency."
- Residency training is much more decentralized than
medical school education.
- Residency training ranges from 3 years for generalist
fields, such as family medicine and pediatrics,
through 4 to 5 years for specialty training in fields such
as surgery and obstetrics-gynecology, to 6 years or
longer for physicians pursuing highly subspecialized
training.
-Some osteopathic schools sponsor osteopathic
residency programs.
-Once physicians have completed residency training, the American Board of Medical Specialties certifies physicians for board certification in their particular specialty field.
-Criteria for board certification: completion of
training in an ACGME-accredited program and passing
of an examination administered by the specific specialty board (e.g., the American Board of Pediatrics)
----Board certification is not required for state licensure, but may promote their expertise and qualifications, and make them be considered by hospitals for "privileges"
-ACGME residency programs consists of:
----25% more physicians
----7% osteopathy
----Remainder of the ACGME residency positions are filled by physicians who graduated from medical schools outside the United States
- If the international student does residency and gets licence in US it is okay, if they do residency outside US it is almost impossible to get a license in the US
- Usually these people are only on education visa and return to their country after
-In Canada and most European unions, a public or quasipublic agency regulates a uniform fee schedule for physician and hospital payments
---Negotiations between payers (purchasers and insurers) and professional organizations determine this fee schedule
-In the United States, Medicare, Medicaid and many private insurances use a pre-determined (i.e. DRGs) prices for particular services (no longer usual, customary, and reasonable payments)
-Strategies to control healthcare costs have had limited success when regulated at the fee-for-service level
----tried competitive bidding among hospitals for Medicaid contracts and private ins plans bargained for reduced hosp and dr fees (these methods not successful)
-Two major problems limit price control at the fee-for service level:
----1) The first problem occurs when price controls are implemented in a piecemeal fashion by different payers. This produces cost-shifting. Cost-shifting- passing the excess costs of care for one group onto another group (A uniform fee schedule by all players i.e. Germany or by a single player i.e. Canada helps to avoid this phenomenon. )
----2) The quantity of services provided often surges when prices are strictly controlled, leading some analysts to conclude that providers respond to fee controls by inducing higher use of services in order to maintain earnings
- Price controls do not limit the quantity of services, but may make it more difficult to find a provider when the provider is being paid less by your ins i.e. Medicaid*
- This resulted in a "patient churning" where there was a high number of patients, but quality of care decreased
-Utilization management involves the surveillance of and intervention in the clinical activities of physicians for the purpose of controlling costs.
-Seeks to influence physician behavior (rather than pt behavior as in cost sharing)
-The mechanism is simple and direct:
----Denial of payment for services it deems unnecessary
enial of payment for services deemed unnecessary.
-UM is related to the unit of payment in the following
way: whoever is at financial risk performs UM.
----Under fee-for-service reimbursemen, insurance companies perform UM to reduce their payments
to hospitals and physicians.
----The DRG system induces hospitals, at risk for losing money if their patients stay too long, to perform UM.
----Under an HMO capitation contract with a primary physician group, the physician group conducts UM so that it does not pay more to physicians than it receives in capitation payments.
----If an HMO pays a hospital at per diem rate, the HMO may send a UM nurse to the hospital each day to review whether the patient is ready to go home
CONS:
- A few case studies on UM have shown some short-term reduction in hospitalization rates and surgery BUT there is little evidence that this approach yields substantial savings (esp w/ the overhead of UM)
- UM appears to be a "painless" form of cost control because it selectively reduces inappropriate or unnecessary care, but decisions are on a case-by-case basis without guidelines and lead to decisions that
may be inconsistent both between different reviewers for the same case and among the same reviewer for different cases
-UM has been criticized as a process of micro-management of clinical decisions that intrudes into the physician-patient relationship
----Dr's in US called "second-guessed and paperwork-laden physicians in western industrialized democracies"
- Dr appeals are very time consuming
ATTEMPTS TO MAKE UM BETTER
- Practice profiling, rather than focusing on individual cases, is now used and give a summary data on practice patterns to identify physicians whose overall use
of services significantly deviates from the standards set
by other physicians in the community
---Canada and Germany deal with outliers by educational and monitoring activities
---This is expensive and then brings to question the effectiveness as a cost control tool
- Overall most explicit form of UM is the insurances total denial of coverage for a service i.e. in vitro fertilization or experimental cx tx
-Supply limits are controls on the number of physicians and other caregivers and on material resources (# of hospital beds or MRI scanners).
- Supply limits can take place in HMO or even as big as an entire nation i.e. Canada
- Number of elective operations and invasive procedures i.e. cardiac catheterization performed per
capita increases with per-capita supply of surgeons and
cardiologists, respectively and this phenomenon is called "supplier-induced demand".
-Controlling MD supply may reduce the use of MD services and thereby contribute to cost containment.
- Per-capita spending for fee-for-service Medicare patients is over 2x as high in some regions of the US than in others and is due to the quantity of services provided
-Residents of areas with a greater per-capita supply of hospital beds are up to 30% more likely to be hospitalized than those with fewer beds.
-The maxim that "empty beds tend to become filled" has been known as Roemer's law
----Ideally, those truly in need gain access to appropriate services, with physicians possessing the wisdom to distinguish those patients truly in need (Rob) from those not requiring the service (Bob).
- Limitation of capacity do restrain use i.e. UK and Canada have less cardiac centers than US and so these places perform less cardiac surgeries than does the US
-"Natural Experiment"
---Provides an illustration of how restricting the supply of a high cost resource may be implemented in a relatively painless manner for pts clinical outcomes
---A nursing shortage in a U.S. hospital made it necessary to reduce the ICU beds from 18 to 8 and as a result the ER drs limited the admission of pts w/ chest pain to only those who actually suffered MI
---Limiting the use of ICU beds did not result in any adverse health outcomes to those admitting to no ICU bed incld those who even had an MI
---This study suggest that when faced with supply limits, MDs may be able to prioritize patients on clinical grounds in a manner that selectively reduces unnecessary services.
---This approach to contain costs is less intrusive than utilization management (UM) which relies on external parties to authorize or deny individual services
COMPETENT HEALTHCARE PROVIDERS
--All healthcare providers must have the skills to diagnose problems and to choose the appropriate treatments.
--Incompetent healthcare providers result in poor quality care and poor patient outcomes.
--Medical negligence is defined as failure to meet the
standard of practice of an average qualified physician
practicing in the same specialty (look at the next slide)
SEPARATION OF FINANCIAL AND CLINICAL DECEIDIONS (MONEY AND QUALITY OF CARE)
--Impact of financial consideration effects the quantity and quality of medical care
--Fee-for-service VS capitation
----Fee-for-service encourages providers to perform more services
-------Most surgeons in the United States are compensated via fee-for-service
----Capitation payments rewards providers who perform less medical services
--Bunker (1970) study found that the U.S. performed twice as many surgical procedures as Great Britain.
-----Bunker speculated that the number was due to the way physicians in the U.S. (fee-for-service) were paid versus Great Britain (salary), thus many of the surgical procedures in the U.S. may be unnecessary
--Commercialization of Medicine
-----The introduction of technology and the increase of physician business ventures.
-----In Florida, 40% of practicing physicians owned services to which they referred their patients to.
-----In Florida, physicians owned or partially owned services include:
-------93% of diagnostic imaging facilities
-------76% of ambulatory surgery centers
-------60% of clinical laboratories
ORGANIZATION OF HEALTH CARE INSTITUTIONS TO MAXIMIZE QUALITY (HEALTH CARE SYSTEMS AND QUALITY OF CARE)
--How health care systems and institutions are organized has a major impact on health care outcomes
Licensing:
-Pros
--All healthcare providers go through training and special licensing exams to ensure they have at least a basic level of knowledge and competence.
-Cons
--Not all healthcare providers that pass their licensing exams are competent
----This may point to a failure in the educational and licensing systems.
----Another reason may be that the healthcare provider was competent at the time of licensure but with the passage of time their skills have deteriorated.
--No re-examination
------"Don't use it, you lose it"
------The role of CEUs
------Hospital competencies
-In most cases, licensing boards only respond to patient or health professional complaints about negligent or unprofessional behavior
- Certification agencies require periodic re-examinations to maintain active specialty certification and some require drs to perform and document systemic quality reviews on their own clinical practice
Peer Reviews:
--Traditional approach to quality assurance
--Evaluation conducted by healthcare providers on fellow peers to determine appropriateness and quality of services
--Has been around for a long time, but Medicare made it very popular
--Joint Commission requires hospital medical staff to set-up peer review committees for the purpose of maintaining quality of care in their facilities.
--Joint Commission can terminate hospitals from the Medicare program if it finds that the hospital's quality is deficient
-- Some cons include adhereing to the theory of bad apples, peer reviews often disagree whether or not quality of care is adequate
Chronic Disease Prevention seen in two distinct perspectives:
-1) Individual
--Medical model seeks to identify high-risk individuals and offer them prevention through patient education
----Medical model may target interventions to wrong individuals
--Examples: Smoking cessation & low fat diets
--May lead to tunnel vision regarding cause and prevention of disease
----i.e. Cholesterol as an exmaple
------In Finland, CHD common, 20% of diet saturated fat, and 56% of men aged 40 to 59 years had cholesterol levels > 250 mg/dL. In Japan, CHD was rare, 3% of saturated fat, and only 7% of men aged 40 to 59 years had cholesterol levels > 250 mg/dL.
-------If we compared two individuals in east Finland who eat the same diet, one with a cholesterol level of 200 mg/dL and the other with a level of 300 mg/dL, we might conclude that the variation in cholesterol levels among individuals is caused by genetic or other factors, but not diet.
--This model believes the concept that in noninfectious chronic disease, individuals play a major role in causing their own illnesses by such behaviors as smoking, drinking alcohol, and eating high-fat foods.
-2) Population
--Public health model seeks to reduce disease in the whole population through mass education campaigns, campaigns to reduce drinking and driving, taxing tobacco products, labeling of food products
--Looking at the cholesterol example from above, If we look at entire populations, studying the average cholesterol level and the percentage of fat in the diet in east Finland and in Japan, we will conclude that high-fat diets correlate with high levels of cholesterol and with high rates of CHD (under this model, they strive to reduce population cholesterol levels rather than looking at individuals w/ high cholesterol as being high risk)
-----10% reduction in the serum cholesterol distribution of the entire population would do far more to reduce the incidence of heart disease than a 30% reduction in the cholesterol levels of those relatively few individuals with counts greater than 300 mg/dL
-- This model believes that modern industrial society,
rather than the individuals living in that society, creates
the conditions leading to heart disease, cancer, stroke, and other major chronic diseases of the developed world (i.e. marketing)
"SOLUTION"
-To implement the 2nd epidemiologic revolution, the medical (individual) and public health (population) models must be joined
-Medical caregivers must try and help individual patients make lifestyle changes
-Society must look for ways to reduce consumption of alcohol, tobacco and high-fat foods
--One model that bridges the medical and public health approach is the community-oriented primary care model
-Cancer mortality rates have increased through 1990
--Mortality rates decline by 16% between 1990 and 2006 as a result of reduction in cigarette smoking
--Breast Cancer mortality rates have declined between 1990-2006, but breast cancer rates are higher for African American women than White women
PRIMARY PREVENTION
-Creating an effective prevention strategy depends on understanding the epidemiology of that particular disease
-Lung cx has link to smoking, but in many cancers, the cause is unclear and no primary prevention exists only secondary
SECONDARY PREVENTION
- i.e. Pap smears for early detection of cervical cancer
and fecal occult blood testing and colonoscopy for
detection of colorectal cancer, Mammograms and Breast Exams for breast cx
RISK FACTORS FOR BREAST CANCER
-Age greater than 65 years
-Family history of breast cancer
-Atypical hyperplasia on breast biopsy
-Birth in North America or Northern Europe
-BRCA genotype
-Women who get their menstrual cycles at a young age (More years of a ovalutory cycle)
Only 1/4, 25% of all breast cancer cases can be accounted for using the risk factors identified so far for breast cancer
MODERN INDUSTRIALIZATION
- See a higher incidence in US than other under developed nations
- The theory is that industrialization is primary cause and hormones are secondary cause
--Evidence linking breast cancer incidence with dietary fat is weak
-Role of estrogen in products may contribute to breast cancer
---Used as an additive in poultry and cattle feed
---Pesticide residue have estrogen-like substances
- Some studies have linked breast cancer risk to organochlorine insecticides, polycyclic aromatic hydrocarbons, and organic solvents, but research on these environmental causes of breast cancer has been inadequate and inconsistent
- Lack of knowledge of the cause of breast cx makes secondary prevention measures essential
Early diagnosis is critical to reducing mortality rates