question

3 perspectives on the definition of "cost" -perspective of the consumers and financiers -national perspective -perspective of the providers

answer

1. Consumers/Financiers = cost is the price of health care 2. National = cost refers to how much a nation spends on healthcare services - consumption of economic resources in the delivery of health care 3. Providers = cost refers to staff salaries, rental of space, purchase of supplies, costs of production

question

healthcare expenditures calculation

answer

E= (P)(Q) expenditures = price x quanitty

question

in 2005, the US spent $____ per capita on health; more than any other country!

answer

$6,401

question

the health care sector will remain one of the ____-_____ components of the US economy

answer

fastest-growing

question

*9 major things that influence medical cost inflation / the high health care costs*

answer

1. third party payment - causes moral hazard 2. imperfect market - not enough competition so you have to pay costs to certain providers 3. growth of technology 4. increase in the elderly population - require more care 5. medical model of health care delivery - not enough preventative services 6. multipayer system and administrative costs 7. defensive medicine - unnecessary procedures 8. waste and abuse 9. practice variations - causes duplication of services

question

how does third party payment cause high health care costs?

answer

the third party pays most of the bill, so there's moral hazard and provider-induced demand which leads to excessive utilization since somebody else (the third party) is paying

question

how does an imperfect market cause high health care costs?

answer

the use of healthcare is driven by need rather than economic demand so the quantity of care is higher than in a competitive market and it costs more than the true economic costs of production

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how does growth of technology cause high health care costs?

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-new technology is expensive to develop, and costs incurred in its research and development are included in the total health care expenditures -pts want to use the newest, latest, and greatest tech which costs more

question

how does an increase in the elderly population cause high health care costs?

answer

because elderly people consume more health care compared to other age groups, and incur costs that are nearly 3x as high as the general population

question

how does the medical model of health care delivery cause high health care costs?

answer

because it de-emphasizes prevention and lifestyle/behavior changes, so more costly health care resources must be employed to treat health problems that could've been prevented

question

how does the multiplayer system and administrative costs cause high health care costs?

answer

b/c the multiplayer system is complex, costs are often duplicated and may account for as much as 25% of total health care expenditures in the US

question

how does defensive medicine cause high health care costs?

answer

-b/c it leads to tests/services that are not medically justified but rather are performed by physicians to protect themselves -malpractice insurance premiums for physicians add to cost

question

how does waste and abuse cause high health care costs?

answer

-b/c more services are provided than are medically necessary -healthcare fraud = charging third party payers for a higher priced service when a lower priced service was delivered

question

how do practice variations cause high health care costs?

answer

some geographic areas practice medicine more intensely than other areas, increasing costs without much better health outcomes

question

why has cost containment in the US not been successful? (2 reasons)

answer

1. cost containment measures can only be applied in a piecemeal fashion & can affect only certain targeted sectors of the healthcare delivery system at 1 time 2. cost shifting btwn programs and sectors

question

*cost shifting*

answer

the ability of providers to make up for lost revenues in one area by increasing utilization or charging higher prices in other areas that are free of controls (other countries have all-payer systems)

question

health planning

answer

an undertaking by the govt to align and distribute health resources in a manner that, in the eyes of the govt, would achieve desired health outcomes for all, while controlling costs

question

*Economic Stabilization Program (ESP)*

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-imposed by Nixon -placed limits on the amt that hospitals could raise their prices from year to year -it helped some, but did not place limits on quantity or services or costs of production so it ended up not working out

question

*Omnibus Budget Reconciliation Act (OBRA)*

answer

helped establish a national medicare fee schedule (resource-based relative value scale) that paid physicians according to relative value units of services

question

*peer review*

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-the general process of medical review of utilization and quality carried out directly by, or under the supervision of, physicians - to decide if care is reasonable, necessary, quality, and provided in the most appropriate setting

question

peer review organizations

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paid physicians to review the care provided to medicare beneficiaries

question

4 broad types of competitive strategies

answer

1. demand-side incentives 2. supply-side regulation 3. payer-driven price competition 4. utilization controls

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demand-side incentives

answer

cost-sharing mechanisms that place a larger cost burden on consumers, thereby encouraging consumers to be more cost conscious & judicious in their utilization of services

question

supply-side rationing

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antitrust laws passed, which prohibit business practices that stifle competition among providers, such as price fixing, price discrimination, exclusive contracting arrangements, and mergers deemed anticompetitive by the Dept of Justice

question

Payer-driven price competition

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occurs when employers shop for the best value in terms of the cost of premiums and the benefits package (competition among insurers), and when MCOs shop for the best value from providers of health services (competition among providers)

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utilization controls

answer

used in managed care to eliminate some unnecessary/inappropriate services provided to consumers by intervening in the decisions made by providers

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how do electronic health records help reduce costs of healthcare?

answer

they contain a pts complete history in the healthcare system, eliminating the problem of missing records & paperwork -results in better cost efficiencies through improved care coordination that can reduce clinicians' prescription of unnecessary tests & treatments

question

70% of all US health care costs are generated by only 10% of patients, who typically have one or more ______________________________

answer

chronic diseases

question

with the growth of managed care, ____________________ have become increasingly critical in recording and evaluating access to health care

answer

encounter databases

question

Initiatives to increase access to healthcare

answer

-Sheppard-Towner act of 1921 -SS amendments -Medicare -money given to states to create CHIP -Affordable Care Act

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Sheppard-Towner act of 1921

answer

early federal attempt to provide direct primary care health services to economically disadvantaged mothers & children

question

*Institute of Medicine definition of "quality"*

answer

the degree to which health services increase the likelihood of desired health outcomes, and are consistent w/ current professional knowledge -performance occurs on a continuum -focus on system vs individual -quality has 3 diff perspectives -emphasis on services that improve health outcomes

question

*micro-indicators of healthcare quality*

answer

*focus on performance of an INDIVIDUAL or ORGANIZATION* small area variations medical errors pt. satisfaction quality of life health outcomes

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*macro-level indicators of healthcare quality*

answer

*focus on performance of ENTIRE SYSTEM* cost access population health

question

*Donabedian's 3 domains in which health care quality should be examined*

answer

structure process outcomes (should be collectively used to monitor quality of care)

question

**4 Examples of the STRUCTURE of healthcare**

answer

-Facilities (licensing/accreditation) -Equipment -Staff -Delivery System

question

*Process of Health Care examples (6)*

answer

-diagnosis -treatment procedures -drug administration -wait time -cost -communication, dignity, respect, compassion

question

*Outcomes of Health Care examples (7)*

answer

-pt satisfaction -health status -recovery, improvement -nosocomial infections -rehospitalization -mortality -incidence & prevalence of disease

question

*Clinical Practice Guidelines*

answer

-plan for managing a clinical problem based on evidence -scientifically based protocols to guide physicians & clinical decisions -designed to promote lower costs & better outcomes

question

cost efficiency

answer

when the benefit received is greater than the cost incurred for the service provided

question

underutilization

answer

benefits of an intervention outweigh the risks/costs and yet the intervention is not used

question

overutilization

answer

-costs/risks of a treatment outweigh the benefits & yet additional care is delivered -overuse = wasted resources

question

*critical pathways*

answer

-outcome-based clinical management tools for interdisciplinary coordination of care among multiple depts & caregivers -have a timeline for planned medical interventions -reduces costs & improves quality by reducing errors & duplicate services

question

risk management

answer

-proactive efforts to prevent adverse events related to clinical care and facilities operations -focused on avoiding medical malpractice -review clinical processes/protocols to reduce malpractice litigation

question

Accountable Care Organizations (ACO)

answer

designed to help increase cooperation btwn providers across various health care settings to improve *Medicare* pt outcomes

question

Agency for Healthcare Research & Quality (AHRQ) function + 2 examples

answer

to produce evidence to make hlth care safer, higher quality, more accessible, affordable, equitable, & to work within DHHS to make sure the evidence is understood & used EXs: national health quality report & national health disparity report

question

perspectives of quality

answer

1. Pt./Consumer - when QOL is improved after care 2. Provider - when the procedure goes as planned 3. Payer (insurance) - good outcomes w/ low costs

question

To Err is Human

answer

-healthcare in US is not as safe as it should be- up to 100,000 deaths due to medical errors -defined 4 types of errors (diagnostic, treatment, prevention, other)

question

EXAMPLES of diagnostic errors

answer

wrong diagnoses or delay in diagnoses failure to give tests using outdated tests failure to review/follow up on test results

question

3 EXAMPLES of treatment errors

answer

error in procedure error in drug administration delayed treatment

question

EXAMPLES of prevention errors

answer

inadequate follow ups inadequate prophylactic treatment

question

2 examples of "other" errors (not diagnostic, treatment, or prevention errors)

answer

failure of communication equipment failure

question

"Crossing the Quality Chasm"

answer

-paper that outlined 6 aims for improvement in healthcare quality 1. SAFETY -avoiding injuries 2. EFFECTIVE - provide services based on scientific evidence for ALL who may benefit from them 3. PATIENT-CENTERED - providing care that's respectful of pt. preferences, values, & needs 4. TIMELY - reducing harmful delays/wait times 5. EFFICIENT - avoiding waste of equipment, ideas, energy 6. EQUITABLE - providing care that doesn't vary in quality b/c of personal characteristics

healthcare systems ch. 12 – cost, access, & quality – Flashcards

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