Health Care Systems

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CH 1 Basics of US HC
1. Understand the basic nature of the US health care system
a. Its unique its not a system
b. no universal health care covered by taxes
c. no other country operates like the US
d. not all citizens are covered
e. multiple forms of insurance, delivery, financing
f. Large 5 million employees
g. Complex - multiple providers, payers, insurers, etc
h. Expensive (>18% of GDP in 2009 20% in 2015)
i. Financially driven
j. ~ 50/50 'blend' of private and public sources
2. Be able to outline the four key components of the health care delivery system (p. 6 fig)
a. "QUAD FUNCTION MODEL"
i. Financing - buying insurance or paying for health services consumed
ii. Delivery(providers) - entity that delivers healthcare and receives insurance
payment for those services
iii. Insurance - to protect against catastrophic risk, determines the services an
individual is eligible to receive
iv. Payment (reimbursement) - funds distributed from insurance premiums to
providers for services rendered
3. Have an overview of health care systems in other countries (p.21 chart)
a. Canada National Health Insurance (NHI) Financed by taxes, delivered by private
providers
b. Great Britain National Health System (NHS) Financed by taxes, delivered by
government
c. Germany Socialized Health Insurance (SHI) Government mandates contributions by
employers and employees to finance healthcare. Private providers and private NFP
insurance companies
4. Characteristics of US health care
a. No central governance
b. Access is selective based on insurance coverage
c. Imperfect market
d. 3rd party insurers act as intermediaries between financing and delivery function
e. Existence of multiple payers makes the system cumbersome
f. Legal risks for docs
g. Balance of power prevents dominance.
5. Moral Hazard- that once enrollees have purchased health insurance, they will use healthcare
services to a greater extent than if they were without health insurance.
6. Systems framework (pg 29)
a. Main components- system inputs, system structure, system process, system outputs,
system outlooks
7. ACA takeaways:
a. ACA main goal is to increase access
b. All citizens are required to have access or will pay a fine (Individual Mandate)
c. Expand Medicaid
d. Buy subsidized insurance thru GOV run exchanges (Employer Mandate)
e. ACA fails to achieve universal coverage
f. ACA promotes a focus shift: treat disease to prevent disease.
g. Adds responsibility to providers to be more efficient will improving quality
8. Trends:
a. Shift from Inpatient to Outpatient

b. Move from a fragmented system to a managed system

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9. Chapter Summary: US system is fragmented, but no system is perfect. HC managers must

understand how the system works and evolves. The systems framework provides an
organized approach.
CH 2 Holistic Health
1. Define Health:
a. WHO: A complete state of physical, mental and social well-being, not just merely the
absence of disease
2. Four dimension of holistic health- wellbeing of every aspect of what makes a person whole
and complete
a. Physical
b. Social
c. Spiritual
d. Mental
3. The determinants of health (MIGS)
a. Medical Practice 10%
b. Individual Behaviors 50%
c. Genetic makeup - 20% (of premature deaths)
d. Social and Environmental 20%
e. explore the American beliefs and values in the delivery of health care
f. Advance science
g. Champion of capitalism
h. Entrepreneurial spirit and self-determination
i. Free enterprise and a distrust of the government
j. Concern for the underprivileged
4. Epidemiology triangle Chart (Disease in the center)
a. Host
b. Agent
c. Environment
5. Disease prevention under ACAa. Established the prevention and public health fund.3.2 billion.
b. Private health requires providing a range of prevention services.
c. Emphasis on workplace wellness programs
6. Health protection and environmental health
a. Dealt with prevention of spreading disease through water, air and food
b. Big in 1900 with diarrhea, pneumonia, tuberculosis
c. 21st century, chemical, biological and nuclear agents are the new threat
7. Health Promotion and disease prevention
a. Primary prevention-decreases probability (anti-smoking campaign)
b. Secondary prevention-health screening (Cervical cancer screening)
c. Tertiary prevention-monitoring the process to prevent complication (Cholesterol
screening for pts with hypertension)
d. Social and environment
e. Medical care
8. explore efforts to integrate community health (p.67)
a. Increase quality and use of life
b. Eliminate health disparity (not due to access)
c. Empowering people to make good decisions
d. Healthy people (2000 2010 - 2020 long-term integrated plan
e. Integrated model for holistic health
9. Pg 55- Minimal time spent on cultural values. The Social Conditions in which people live and
work are the single most important determinant of ones health.

10.

a. Advancement of science was instrumental in creating the current system

b. HC is seen as an econ good
c. Clear distinction in health care service s available between rich and poor
d. Free enterprise and mistrust of GOV keeps HC in private interest
Measures of health Utilization
a. Crude measures
i. Access to PC
ii. Utilization of PC
b. Specific Measure
i. Utilization of target services
ii. Utilization of specific inpatient services
c. Institution specific utilization
i. Average daily census
ii. Occupation rate
iii. Average length of stay

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11.Market justice: Emphasizes individual rather than collect responsibility for health
a. Social justice: regards health as a social good
b. Free market: implies that giving people something they have not earned would be
morally and economically wrong
CH 3 Evolution of HC Services
1. Discover historical developments that have shaped the nature of the U.S. Health Care
Delivery system: Milestones: WWII Wage Freeze-Health Insurance Incentive, 1965 Great
Society-Medicare, Medicaid, 1910 Flexner Reports impact.
a. 4 Main Eras: Pre-Industrial, Post-Industrial, Corporation, Health Care Reform-each
demarcating a major change in the structure of healthcare delivery from a weak and
insecure trade to an independent, highly respected, lucrative trade.
b. Pre-Industrial: (middle of 18th century-latter part of 19th century) Strong domestic rather
than professional character, emphasis on common sense and natural history.
Professionalization of medicine in the US started later than in Europe/it was an
unorganized trade/primitive medical procedures/no institutional core/unstable
demand/substandard medical education/ no insurance/ competition among providers.
i. 5 Factors why medical profession was largely insignificant:
1. Medical malpractice in disarray
2. Primitive medical procedures
3. Missing institutional core (Almshouse)
4. Unstable demand
5. Substandard Medical Evaluation
c. Post-Industrial: (began in the late 19th century) physicians gained professional
sovereignty caused by/urbanization/science and technology
discoveries/Institutionalization in hospitals/dependency of society to heal the sick (sick
roll)-grew drs authority/autonomy and organization-dr remained independent of
hospitals/licensing/educational reform
i. Transformation of Physician Practice
1. Urbanization
2. Science and technology
3. Institutionalization - Hospitals
4. Dependency the sick role
5. Professional cohesiveness (AMA)
6. Licensing
7. Educational reform (Flexner report proposed higher standards)
p.93
8. healthcare provided by employer due to wage freezing (post WWII)

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d. Corporatization: began in the latter part of the 19th century and is marked by growth of
managed care, organization integration, the information revolution, and globalization.
Impacted physician practice styles and provider autonomy.
e. Health Care Reform: Only in its infancy, recently brought on by ACA. Heighten
government regulations and oversight.
Figure 3.1

2. Evaluate why the system has been resistant to national health insurance reforms
a. Political Inexpediency (bureaucracy)
b. Institutional Dissimilarities
i. Hospitals vs drs/AMA sovereignty/opposition from pharmaceutical and labor
unions
c. Ideological Differences
i. Market justice/self-determination/distorts gov/reliance on private sector
d. Tax Aversion
3. Explore recent developments and key forces that will likely shape the delivery of health
services in the future
a. 1965 Medicare and Medicaid created in social security reforms
i. Part A Hospital
ii. Part B physician bills
iii. Part C allows private insurance companies to provide Medicare
iv. Part D rx drugs
b. Key Forces: Free Market, Adverse to regulations, AMA Politics
i. Political inexpedience, Tax Aversion, Institutional dissimilarities struggle for
power, Explore the corporatization of health care.
4. To provide a historical perspective on health care reform under the Affordable Care Act
a. Patient Protection and Affordable Care Act of 2010 as amended by the Health Care and
Education Reconciliation act of 2010 is known as the Affordable Care Act.
b. ACA is patterned after the Oregon Health Plan and the MA health plan
c. 2012 Supreme court ruling validated the constitutionality of the individual mandate,
but left Medicaid expansion up to each states discretion.
d. ACA opens a new era of reform at the national level, effects will not be seen for some
time
e. Americans remain divided over health care reform under the ACA
5. Evaluate why the system has been resistant to national health insurance reforms. Speculate
the arrival of socialized healthcare:
a. Political maneuvering from ACA in 2010 (Narrowly passed 219-212, passed March 10,
2010).

b.
c.
d.
e.
f.
g.
h.
i.
j.

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Modeled after two state based reforms: Oregon and Massachusetts Health
Plan.
2012 Supreme Court Ruling-Individual Mandate is constitutional; Medicaid is up to each
state.
Country divided-46% in favor of repealing law. Didnt seek public consensus of values
and ethics. Legal and implementation challenges
Impact wont be felt for some time. Employer mandate delayed to 2015
Impact of failed Clinton plan in the 1990s technologically it was not possible at that
time, and the ideas were not popular at the timemost Americans have a tax aversion
(tax increases).
Impact of Baylor plan genesis of managed healthcare in the United States, established
in 1929 (1,200 teachers involved)
Professional sovereignty (p. 89)
The reason why health care is fragmented in the U.S. social, economic, and
technological reasons primarily.
WWII and frozen wages lead to insurance as a perk; Great Society in the 1960s
developed Medicare and Medicaid.

CH 4 Health professionals
Chapter Four Terminal Learning Objectives
Note: Health care will continue to rise because of growth in population and age of population
Know that the DO looks at treatment from a holistic point of view.
To familiarize the different types of health service professionals
Physicians
NonPhysician Practitioners
Nurses
Health Administrators
Dentists
Allied Health Professionals
Pharmacists
Therapist (Physical/Occupational)
Optometrists
Social Workers

Educators
Psychologists
Podiatrists
Chiropractors

To differentiate between primary and specialty care, and the causes for imbalance between the
two in the U.S.
Primary Care Physicians (Primary Care Provider) / Generalists
Train in family medicine/general practice, general internal medicine and pediatrics
Provide preventative medicine (i.e. exams, immunizations, mammographies, pap smears)
Patients problems less severe and occur less frequently
General Practitioner/Family Practice accounts for greatest proportion of ambulatory care visits
Specialists
Physicians in nonprimary care specialties
Must seek certification in a medical specialization
Takes more years of advanced residence training plus years of practice
Six Functional Groups:
-Internal medicine
-Medical
-Obstetrics/Gynecology
-Surgery
-Hospital based radiology, anesthesiology, pathology
-Psychiatry
See Exhibit 4-1, page 128
See Table 4-3, page 129
Notes: Obstetrics/Gynecology: spent most hours in patient care per week, highest in operating
expense and malpractice premium
Surgeons paid most (over $220,540 per year)

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Primary Care
Different according to time, focus and scope of service to patients
Five Areas of Distinction:
the first contact to the health care system
gate-keepers
primary care is longitudinal, they follow up in treatment and coordinate care (they serve as
patient advisors and advocates)
focuses on the whole person (holistic, integrates)
spend much time in ambulatory care settings
Specialty Care
Five Areas of Distinction
Seen after patient has seen a General Practitioner usually
Requires referral from a Primary Care Provider to see a patient
Episodic, more focused and intense
Limited to an illness episode
Deal with specific disease or body organs
Time spent in inpatient hospitals, using state-of art technology
Discuss maldistribution (2) in the physician labor force (geographic and specialty/family care)
Geographic Maldistribution
Shortages outside metropolitan areas (<50k) exist because:
Less income
Less professional interaction
Little access to facilities and
technology
Less continuing education and professional growth
Lower standards of living
Fewer social and cultural diversities
Less education for children
Reasons for Specialty maldistribution:
(3) Medical technology, Reimbursement methods, Specialty-oriented medical education
Specialists get better:
Pay
Prestige

Use of high tech

Intellectual challenge

Work hours

To help overcome the physician imbalance and maldistribution

Finding more general practicioners $230M to increase general care, incentivizing, leveraging
more team care approaches to health
To outline initiatives under the Affordable Care Act to relieve shortages of primary care providers
and coordinated care delivery in team settings
To understand the role of non-physician providers healthcare extenders (pg 141 and slides)
Clinical professionals who practice in many areas similar to a physician, BUT do not have a
physician or DO degree (PAs and NPPs) CRNAs and Midwives too
PAs follow medical model on disease, NPs follow nursing model and health promotion, in most
states NPs can practice independently (except for surgery)
To identify Allied Health professionals and their role
Includes many health-related areas
Constitutes 60% of U.S. health care workforce
Two Broad Categories: 1) Technicians/assistants 2) Therapists/technologists

See Exhibit 4-2, page 143

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The discuss the functions and qualifications of health service administrators/pg 146 for a list of
their functions
Top Level, mid level, entry level.
To assess global health workforce challenges
57 countries (mostly poor and predominately in sub-Saharan Africa) face a health workforce
crisis
Shortage of primary care physicians in general to accommodate increasing need for chronic care
The migration of health professionals from developing to developed countries (Brain drain)
ACA Takeaway: (pg. 149)
Influx of newly-insured individuals will strain the existing primary care infrastructure
$230 million invested to increase the number of medical residents, nurse practitioners, and
physician assistants trained in primary care
ACA to emphasize medical care delivery by teams of health care professionals
ACA to provide for loan forgiveness for individuals who choose to work in certain locations
Leveraging nurses through advance nursing expansion
CH 5 Technology
1) To understand the meaning and role of medical technology in health care delivery
a) Medical technology: application of the scientific body of knowledge for the purpose of
improving health and creating efficiencies in the delivery of health care
b) Role: increased demand and utilization/fueled specialization/made many specialized
services available in the outpatient setting
2) To appreciate the growing applications of information technology and informatics in the
delivery of health care
a) IT: IT deals with the gathering, storage, analysis, and transformation of data so it becomes
useful information for health care professionals, managers, payers, and patients
b) Informatics: application of information science to improve the efficiency, accuracy, and
reliability of health care services; uses IT systems to emphasizing the improvement of
health care (ie clinical decision support system).
c) IT applications:
i) Clinical Systems: support patient care delivery (EHR, CPOE)
ii) Administrative systems: support and financial systems (billing)
iii) Decision support systems: support managerial and clinical decision making
(references, treatment protocols, patient schedulers)
3) To survey the factors influencing the creation, dissemination, and utilization of technology
a) Innovation: creation of a new product, technique, or service
Innovation sees rapid diffusion when new technology is beneficial and the benefit can be
evaluated, technology is compatible with the adopters values and needs, and it is
reimbursable.

b) Diffusion: Spread of technology into society

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c) Utilization: Once it is acquired, the use of technology is almost ensured

i) Anthro-Cultural beliefs and values: cultural beliefs and values will shape expectations
and demands of technology in health care. Americans have a large belief that they
require the most advanced technology to improve health.
ii) Medical Specialization: Specialty training in residencies exposes doctors early in their
careers to technology and affects future professional behavior and patterns.
iii) Financing and Payment: Fixed provider payments (salaries) curtail the incentive to use
high-tech procedures. Generous insurance coverage does increase spending for new
products however.
iv) Technology-Driven Competition: Hospitals compete for the business of the well-insured
patients. To do this, they advertise state-of-the-art technology. Additionally, to recruit
specialists, hospitals will acquire more of the costly equipment that is available.
v) Expenditures on Research and Development: The US spends the most money on R&D
for healthcare, and the amount is rising.
vi) Supply-Side Controls: Managed care organizations will slow the number of procedures
used. Canada is an example of fully regulated side controls.
vii) Government Policy: US Govt is one of the largest sources of funding for biomedical
research. Direct control by government has not been possible.
4) To discuss the governments role in technology diffusion
a) Diffusion - Spread of technology into society
b) Government policy:
i) Approval or disapproval of drugs and devices
ii) Funding of biomedical research
iii) Regulation of Drugs, Devices, and Biologics
(1) The FDAs drug approval process includes
(a) safety
(b) effectiveness
(c) access (whether by prescription or over the counter)
5) To examine the impact of technology on various aspects of domestic and global delivery of
health care
PG 176-180
a) Treatments that previously did not exist
b) Improved diagnosis and treatment
c) Greater effectiveness
d) Less invasive procedures
e) Safer procedures
f) Higher health care costs

g) Low access to robust technology based on geographical remoteness

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h) Transformation of hospitals into large medical centers with multiple departments and
specialties
i) Increase in exports of medical technology to other countries.
j) Raising more ethical concerns as new discoveries are made (cloning, stem-cell, etc.)
6) To study the various facets of health technology assessment, and its current and future
directions
a) Health technology assessment: Examination and reporting of properties of medical
technology
b) Looks at: safety/effectiveness/feasibility/indications for use/cost and cost
effectiveness/social, economic and ethical consequences through clinical trials
c) It is important because: Vast sums of money are spent on ineffective care and on services
that do not show improved health outcomes
d) Direction:
i) Public sector is seen through VA and DOD research/most research is done on the
private side
ii) Info must be shared with providers and policy makers/standard methods
needed/balance between efficacy and economic worth will need a change in American
values/must incorporate ethical concerns
7) To become familiar with provisions in the Affordable Care Act that pertain to medical
technology
a) HITECH pg 162
b) HIPAA expansions pg 163
c) 2.3% excise tax on medical devices
d) The Biologics Price Competition and Innovation Act of 2009 authorizes the FDA to regulate
biosimilars (parallel to generic drugs)
e) The Biosimilar User Fee Act of 2012 authorizes the FDA to charge a user fee for the
premarketing review of biosimilars
f) ACA prohibits placing a dollar value on the QALY (one year of quality life)

ACA:
8) 2.3% excise tax is applied to to the sale of certain medical devices by manufactures and
importers of these devices.
9) FDA has been given authority to approve generic (biosimilar) versions of biologics, and to
charge biopham firms a user fee to pay for the review of applications for biosimilar products
10)
ACA prohibits the Patient Centered Outcomes Research Institute from placing a $$ value
on quality-adjusted life years for the purpose of determining cost effectiveness of medical
technology.
Cutler Article:

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Technical innovations are net positive (the value of addl years of life is higher than the
increased costs of healthcare technology). Specifically studied heart attacks, low-birth weight
infants, depression, cataracts, and breast cancer.
Skinner Article:
Written to contradict some of the study methods of Cutler. Specifically looked at acute
myocardial infarctions (AMI). Article asserts that regional differences in health care quality
dramatically affect outcomes of technological intervention (costs higher, outcomes less positive).
Each individual dollar amount should be tied to real value for the patient.
CH 6 Financial
Study the role of health care financing and its impact on health care delivery

Central role of health care financing is to pay for health insurance premiums
Financing also determines how much health care is produced in the private sector
Impacts health care delivery by determining who has access to health care and who does
not; increases demand for covered services; demand would be less if those same services
were paid out of pocket
Expenditures (E) = Price (P) x Quantity of services consumed (Q)
See Figure 6-1 on page 198 See slide with red bubbles

Understand the basics of insurance and its terminology

Mechanism for protection (primary purpose) against RISK

Risk- possibility of a substantial financial loss from an event of which the probability of
occurrence is relatively small
Insurer- insurance agency that assumes risk
Underwriting- systematic technique for evaluating, selecting (or rejecting), classifying, and
rating risks
Premium- amount charged by the insurer to insure against specified risks
Experience Rating- risk rating based on a groups own medical claims experience
Community Rating- sets premiums based on the utilization experience of the entire
population
Adjusted Community rating- risk rating that takes into account demographic factors (i.e.
age, gender, family composition) while ignoring other risk factors
Cost Sharing
Deductible- amount insured must first pay each year before any benefits are
payable by the plan
Copayment- flat amount insured must pay each time health services are received
Coinsurance- set proportion of medical costs that the insured must pay out of
pocket
Benefits- services covered by an insurance plan

Differentiate between group insurance, self-insurance, individual insurance, and managed care

Group Insurance- can be obtained through an employer, a union, or a professional

organization and anticipates that a substantial number of people in the group will
purchase insurance through its sponsor. Advantageous because of its low cost.
Self-insurance- employer act as its own insurer instead of obtaining insurance through an
insurance company.
Individual Insurance- privately purchased by the insured individual.

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Managed Care- integrates the four functions of health care delivery, employs mechanisms
to control utilization of medical services, and determines the price at which each service is
purchased and how much the providers get paid.

Explore trends in employer-based health insurance

A declining number of small businesses are offering health insurance

Employees are paying more of the share of the total health insurance cost
Out-of-pocket costs have been increasing

Examine features of public insurance programs

Medicare finance medical care for persons 65 and older, the disabled who are
entitled to Social Security benefits, and people who have end-stage renal
disease
Part A is the Hospital insurance portion
Part B is supplemental medical insurance; voluntary in nature finance by
general tax revenues an partly by required premium contributions
Part C is Medicare Advantage and it provides additional choices of health
plans; focuses on increasing participation in managed care
Part D was added in 2003 and fully implemented in January 2006 and is a
prescription drug program
Medicaid was designed to finance health care services for the indigent
Childrens Health Insurance Program (CHIP) was created to provide insurance for uninsured
children in low-income households

Understand methods of reimbursement

Capitation- provider is paid a set monthly fee per enrollee (per member per month rate)
Cost-plus reimbursement- traditionally used by Medicare and Medicaid to establish per
diem rates for inpatient stays; rates are based on the total costs incurred in operating the
institution; also called plus because it allows a portion of the capital costs in arriving at the
per-patient-day rate; since rates are set after evaluating the costs retrospectively this
mechanism is also referred to as RESTROSPECTIVE-REIMBURSEMENT
Prospective reimbursement- uses certain established criteria to determine the amount of
reimbursement in advance, before services are delivered
Bundling- package pricing that includes a number of related services in one price (ex.
Optometrists advertise a package that includes eye exams, frames, corrective lenses)

Discuss national and personal health care expenditures

National health care expenditures- total amount spent for all health services and supplies
and health-related research and construction activities consumed in the US during a
calendar year
Personal health care expenditures- portion of the national health care expenditures; these
expenditures are for services and goods related directly to patient care

Disbursement of funds

Carried out in accordance with the reimbursement policy adopted by the particular
program
Commercial insurance companies have their own claims department
Self-insured employers contract third-party administrators to process and pay claims
The government contracts third parties (Blue Cross/Blue Shield) in the private sector to
process Medicare and Medicaid claims

Assess current directions and issues in health care financing

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The supreme courts ruling on the ACA gave the states more decision making power and
say the implementation of the ACA
Economic models predict relatively small declines in employer-sponsored coverage
Extent of Medicaid enrollment remains uncertain
The implementation of the employer mandate was delayed

Cost shifting

Shifting of funds from one entity to another as a way of making up losses in one area by
charging more in other areas

Become familiar with the ACA of 2010/ACA takeaways

As of September 23, 2010, all new health insurance plans must include recommended
preventive services and immunizations to which no cost sharing applies
The ACA added requirements such as coverage of young adults (under 26) under parents
plan, coverage for people with preexisting medical conditions, elimination of yearly or
lifetime benefit dollar limits, caps on annual cost sharing, and targets for medical loss
rations
A relatively large number of previously uninsured will gain coverage under the ACA, but
national health care expenditure will also increase
Insurance expansion rests on the three-legged stool: employer mandate (postponed until
2015), individual mandate, and expansion of Medicaid (some states have chosen not to
comply
Employer mandate- was originally required to go into effect on January
2014; requires employers to either provide employees health insurance or
pay a penalty for not doing so (play-or pay)
Individual mandate- as of January 2014, legal residents are mandated to
have minimum essential coverage or qualify for an exemption of pay a
penalty tax
Expansion of Medicaid- establishing a minimum income eligibility standard
across the nation which was previously left up to each state (struck down
by the supreme court); states can no longer use a persons assets to
determine eligibility
Rules governing health insurance, eligibility, risk rating, mandated benefits, and cost
sharing will displace a number of currently insured people and have an inflationary effect;
self-insured plans are exempt from some of the requirements
A large number of the population is expected to get government subsidies to purchase
health insurance
Prevention benefits under Medicare are enhanced while out of pocket costs for prescription
drugs are reduced; not all Medicaid recipients may receive preventative services
Reforming the reimbursement system; integration of services and financing for dual
eligible
Adverse selection and cost shifting are likely to occur, increasing health insurance
premiums
Starting in October 2012 the ACA required reduction in payments to hospital that incurred
excessive Medicare readmissions for selected conditions

5 question for reimbursements

Who being paid?

What behaviors are being incentivized?
What are the benefits?

 What are the drawbacks?

Who bares financial risk.?
CH 7 Outpatient care/Ambulatory Care

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1. Know the difference between outpatient, ambulatory, and primary care (250)
a
b
c
d
e

Community health centers receive federal and state money to serve rural and inner
cities
Outpatient is more comprehensive
Ambulatory care more diagnostic and therapeutic to the walking (ambulatory)
Outpatient and Ambulatory care used interchangeably
Primary Care
a Plays a central role in a health care delivery system
i Coordination of care
1 Delivery of health services between the patient and the different
components of the delivery system
2 Refer patients to sources of specialized care
3 Give advice regarding various diagnosis and therapies
4 Discuss treatment options
5 Provide continuing care of chronic conditions
b Basic, routine, continuous, coordinated and comprehensive care
c An approach to delivering health care rather than a set of services
d Includes primary and secondary prevention and sometimes tertiary
e integrated health care services
f by clinicians who are accountable for:
i addressing personal health care needs,
ii developing a partnership with patients
iii and practicing in the context of family and community
g Ambulatory Care:
i Care rendered to patients who come to the physician office, clinics, or
outpatient surgery
ii Mobile diagnostic units and home health
iii take services to patients
h Outpatient Care:
i All primary care is outpatient, but not all outpatient care is primary
care, i.e. emergency room, urgent care treatment, outpatient surgery,
rehabilitation, renal dialysis, chemotherapy
1 Sites: Physician Offices, Hospital Emergency Services, Primary
Care Center, Emergent/Urgent Care Centers, Ambulatory Care
Surgery Centers, Community Health Centers
ii SCOPE: Hospital inpatient services continues decline
1 Advanced outpatient happens in a hospital-base
2 Executives see Ambulatory Care as an essential, no longer a
supplemental service line
3 Hospital survival* can depend heavily on Ambulatory Care
4 Competition from home health agencies, Ambulatory Care,
urgent care, outpatient surgery
iii Doesnt require overnight stay incurring room and board costs
iv Ambulatory care similar to community medicine because it serves:
1 surrounding community
2 convenience
3 accessibility
v The most basic outpatient services:
1 physicals and minor treatment in physician office

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vi
f

Healthcare Service Frequency

a Primary Care
i Coordination of care
1 Delivery of health services between the patient and the different
components of the delivery system
ii 75-85% of pop requires only primary
b Secondary Care
i Usually short term
1 Sporadic consultation from a specialist
2 Includes hospitalization
3 Routine surgery
4 10-12% requires referral to short term secondary care
c Tertiary care
i Most complex level of care
ii For conditions that are uncommon
iii Usually institution based
iv Highly specialized
v Technology-driven
vi Rendered in large teaching hospitals
vii May be long term care
viii E.g. trauma, burn treatment, NICU, transplants, open heart surgery
ix 5-10% require tertiary

World Health Organization GOAL of Primary Care:

a

reducing exclusion and social disparities in health (universal coverage

reforms);

organizing health services around people's needs and expectations (service

delivery reforms);

integrating health into all sectors (public policy reforms);

pursuing collaborative models of policy dialogue (leadership reforms); and

increasing stakeholder participation.

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WHO Definition of Primary Health Care

a Essential health care based on scientific acceptable methods, Universally
accessible and acceptable, At an affordable cost, To maintain at every
developmental stage, The first level of contact, Bringing health care as close
as possible to where people live and work, As part of a continuing health care
process.
b Three key elements:
i Point of Entry
1 role of a gatekeeper: patients cannot see a specialist or be
admitted without a physician referral
ii Coordination of Care
1 meant to ensure continuity and comprehensiveness
iii Essential Care
1 Primary care is essential care

Institute of Medicine Definition

a Integrated
i Comprehensiveness, coordinated, continuous, seamless
b Comprehensive
i Addresses any health problem at any stage of a persons life cycle
c Coordinating
i Combining health services to best meet the patients needs
d Continuity
i Care over time
e Accessibility
i Ease that a patient can interact with a clinician for any health problem
f Accountability
i Clinical system
1 To provide quality care, patient satisfaction, use of resources
efficiently, behaving ethically
ii Patient
1 Responsible for own health that they can influence
2 Judicious use of resources

2. Explore principles of PCMH and CBOC (256)

a

New Directions in Primary Care

a Provisions in ACA
i More M&M payments primary care providers
ii incentives workers in primary care
iii Expand health centers / teaching programs
b Patient-Centered Medical Home
i Challenge and views implementing PCMH

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ii Interdisciplinary team of physicians and allied health professionals who
partner with patients and their families.
Community-Oriented Primary Care
i Practices not materialized in US (relook in CH 14)
ii Incorporates elements of good primary care delivery and adds a
population approach to identifying and addressing community health
problems.

3. Identify why there is growth in outpatient care (258)

a

Growth in Outpatient Services

a Changes in reimbursement
i constraining inpatient services
ii favoring outpatient services
b Fewer payment restrictions
i surgery, dialysis, chemotherapy
ii paid as fee-for-service

4. Identify various outpatient settings and services (260)

a

Five
a
b
c

Types of Hospital Based Outpatient Services:

Clinical Services: Special consultation
Surgical Services (same day)
Emergency Services for Acute Services
i Emergent require immediate attention
ii Urgent require attention within a few hours
iii Non urgent, non-emergency (used by mostly uninsured as a substitute
for primary care)
d Home Health Care
e Womens Health Center
i Women are major users of health care due to a female majority
ii Change in culture towards womens equality
iii A national priority
f 85+ Year old Women are increasing in need for Healthcare
Outpatient Care Services: Free Standing Facilities
a Walk in Clinics
i Ambulatory care from basic primary to urgent care
ii Non-routine, episodic basis
iii Convenient
b Urgi-centers
i Usually open 24/7
ii Wide range of routine services
iii First come first serve basis
iv Not comparable to Emergency Department
c Surgi-centers
i Freestanding, independent of hospitals
ii Full range of services for surgeries
iii Outpatient, no overnight
Home Health & Hospices (to live < 6 months, peaceful transition):
a Pain management and psycho-social, spiritual support
b Mainly elderly women
c Little Private insurance users here
i Mainly Medicare so Feds pick up tab
Telephone Access
a Telephone triage: Giving expert opinion and advice to the patient, especially
during hours when a physicians office is usually closed

Page 17 of 38
5. Describe the role of complementary and alternative medicine (CAM) in health care
(276)
a

b
c

Complementary and Alternative (same)

i
Therapies / treatments wide range
ii
Settings / Providers
iii
Ex. Acupuncture, meditation, chiropractor, natural medicine, non-conventional
medicine
Complimentary would be more like phys therapy, etc. and Alternative would be like chiro,
voodoo, etc
Growth of CAM
i
Reasons Use of CAM in other countries
i Last choice have tried everything else
ii Avoid or delay complex medical interventions or toxic treatments (chemo)
iii Vast amount of information (internet) creates choice which empowers
patients
ii
Policy involvement of Government / ACA

6. Appreciate Primary Care in other countries (279)

a

Primary Care in Other Countries

i
Little consistency in care access and payment
ii
Canada, France, and Germany use financial incentives to encourage registration
with a primary care provider.
iii
U.K. offers most comprehensive coverage with little to no patient cost sharing.

7. To understand the various provisions in the Affordable Care Act that apply to
outpatient services (284)
a
b
c
d
e
f
g

Primary care, specialty care, and hospital emergency departments are expected to be
overburdened with an influx of newly-insured patients.
The need for providing uncompensated care by hospitals is expected to decrease.
Components of the ACA that affect community health centers involve maintaining
adequate funding and developing teaching health centers.
Health centers located in states that do not expand Medicaid could face fiscal shortfalls.
Reduces medicare-certified home health agency payments and mandates quality
reporting.
Quality measures for hospice care linked to reimbursement rates.
Vague reimbursement for alternative medicine.

8: SUMMARY:
Main settings for ambulatory care have come full circle
i
ii
iii

In response to economic incentives:

Numerous types of settings developed
Growing interest in complementary and alternative medicine

CH 8. Evolution of hospitals
To get a functional perspective on the evolution of hospitals
Primitive institutions of social welfare
Almshouse (Served the poor) and pesthouses (quarantine) used in 1800s

Page 18 of 38

Distinct institutions of care for the sick

Late 1800s independent institutions developed
Voluntary hospitals: nonprofit community hospitals
Organized institutions of medical practice
Later part of 19th century improved hygiene, advanced medical care
Early 20th century hospital admin became discipline and accreditation was
implemented
Advanced institutions of medical training and research
Physicians received training in hospitals (residency)
Johns Hopkins opened hospital with adjoining medical school
Consolidated system of health services delivery
Multi hospital services formed through mergers and acquisitions
Hospitals diversified into outpatient, home health, sub-acute, long-term.
Inpatient
requires a 24hr stay in a health care facility
Hospital
an institution with at least 6 beds whose function is to deliver patient services that
include diagnostics and treatment
must be licensed
have an organized physician staff
provide continuous nursing services supervised by RNs

To survey the factors that contributed to the growth of hospitals prior to the 1980s
1) advances in medical science
2) development of specialized technology and surgical services
3) advances in medical education
4) Development of Professional Nursing
Florence Nightingale transformed nursing
Efficiency of treatment; hygiene
5) role of government
6) Growth of Health Insurance
Great Depression closed many hospitals
Insurance allowed people to pay for health care
Increased the demand for health care
7) Hospital Survey and Construction Act (Hill Burton Act), 1946
Federal grants to build nonprofit community hospitals
Charitable care was a condition
Biggest factor to increase nations bed supply
By 1980, goal of 4.5 beds per 1,000 population reached
8) Public health insurance (Medicare and Medicaid)
To understand the reasons for the subsequent decline of hospitals and their
utilization
Focus on efficiency
Changes in Reimbursement
From cost-plus to prospective pay system (PPS)
Impact of Managed Care
Emphasis on cost containment due to change in reimbursement rates
Efficient utilization of resources (alternative care settings)
Hospital Closures
Economic constraints could not generate profit
Many rural and urban hospitals closed low utilization
Other hospitals closed wings (used space for alternative purposes)

Page 19 of 38

To learn some key measures pertaining to hospital operations and inpatient utilization
(p. 300)
Discharges
Inpatient Days- counted at midnight
Average Length of Stay
Capacity
Average Daily Census- number of inpatient days-divided by the number of discharges, days of
care / number of days
Occupancy Rate staffed beds average daily census / number of available beds (capacity) x 100
Higher utilization among:
The elderly
Children under one year of age
Women
People of lower socio-economic status
Medicare and Medicaid beneficiaries
Days of care / Discharges (An indicator of severity of illness and resource use)
Highest in federal hospitals, followed by state and local government hospitals
Private nonprofit and for profit hospitals had the same ALOS in 2010
84% of community hospitals in U.S. have fewer than 300 beds
Long-term factors that affect utilization and employment:
Size and nature of population (population growth, aging, health status)
Advances in medical technology, but certain pharmaceuticals have reduced
hospitalizations
Changes in insurance status
Starting around 1995, outpatient settings started employing more workers than hospitals
Declines in reimbursement can lead to staff cuts and hiring freezes
Employment growth in hospitals is countercyclical
2010: Average cost per stay was $9,700
Two main cost drivers:
Intensity of services (utilization of specialty care)
Population growth
To differentiate among various types of hospitals (p. 307)
Over half are private nonprofit (voluntary)
State and local government owned are the next largest group (19%)
For-profit or investor-owned come next (17.3%)
Federal hospitals are the fewest in number (almost 4%)
Numerous ways to classify
Classifications are not mutually exclusive

(Types)
Short stay hospitals
ALOS of 25 days or less
Treat acute conditions
Long stay hospitals
ALOS > 25 days
Psychiatric; LTCHs; chronic care
Long-term care hospital (LTCH)
Long-term care hospital is a special type of long-stay hospital
Must meet Medicare guidelines
Patients with complex medical needs
Rapid growth has occurred

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PPS is based on Medicare Severity Long-Term Care Diagnosis-Related Groups (MSLTC-DRGs)

(Locations)
Urban hospitals
located in a metropolitan statistical area (MSA)
have higher costs: high salaries, competition, broader and complex services
Rural hospitals
not in a MSA
40% of all community hospitals
Inner city urban and rural hospitals treat poor and elderly disproportionately

(Capabilities)
Swing bed: A bed that can be used for acute care or skilled nursing care as needed
Skilled Nursing Facility (SNF) could be a hospital wing, a patient requires discharge from
acute care (3-day acute care stay is required)
Ability to swing was authorized under the Balanced Budget Act, 1997
Saved small rural hospitals from closure
Maximum 25 acute care or swing beds
Emergency services must be available
Must meet a distance test
Can have a 10-bed psychiatric unit, a 10-bed rehabilitation unit, and a SNF
Cost-plus reimbursement, not to exceed 101% of cost
SNF prospective payment applies
Classification by size
no standard classification by size hospital of less than 100 beds CAN be
considered small
costs per adjusted patient day are significantly higher beyond 150 beds (more
specialized services)
medium and large hospitals
extensive and specialized services
technology
highly-trained personnel
Teaching Hospital
AMA approved residency programs for physicians
Academic medical centers: Teaching hospitals organized around medical schools; heavily
engage in research and clinical investigations
Approx. 400 are members of the Council of Teaching Hospitals and Health Systems (COTH)
1 or more graduate residency programs approved by AMA
Main characteristics
Medical training and research. Additional reimbursement from Medicare.
Broad and complex scope of services (often have tertiary care services)
Many located in economically depressed areas. Provide disproportionate share of
uncompensated care. COTH members provide nearly half of charity care nationwide

Church affiliated Hospital

First established by catholic sisterhoods
Mostly community general hospitals
Owned or influenced by church groups
Do not discriminate in giving care
Spiritual and dietary emphases are often present
Osteopathic Hospital (DO)
Till about 1970, osteopaths (DO) operated their own hospitals

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Subsequent acceptance by allopathic practitioners (MD)
Separate osteopathic hospitals are no longer needed; they are also more costly and less
productive
Many have close

To learn how the Affordable Care Act affects physician-owned specialty hospitals and
nonprofit hospitals
To participate in Medicare, new or existing hospitals had to be certified by
December 31, 2010
Restrictions on expansion of existing hospitals (reduced provider-induced demand)
viewed as an assault on the American entrepreneurial system
In response, these hospitals are expanding hours and services, and rejecting
Medicare patients
Exception from Nonprofit Hospitals
IRS Code: tax-exempt status
1 must provide some defined public good (service, education, welfarecharity
care)
2 no distribution of profits to any individual
3 executive pay may not be deemed unreasonably high
4 Problem: They often compete head on with for-profit hospitals
(institutional theory)- one hospital following what another hospital
does.
5 Mixed performance on charity care
6 IRS now requires documentation on community benefit expenditures
7 Tax exemption is controversial
8 Some debate over what constitutes a community benefit
9 Nonprofit hospitals must assess community health needs and implement plans
to meet those needs
10 Establish written policies on financial assistance and emergency care
11 Limit charges according to financial assistance policy
12 Limit billing and collection actions
13 Report on community health needs and provide annual audited financial
statements to the IRS, or face an excise tax
To comprehend some basic concepts in hospital governance
Hospital governance: A tripartite structure
Board of Trustees
Governing body, board of directors- hires and sets CEOs pay
Legally responsible for operations
Establish mission and long-term direction
Evaluate major decisions and approve plans and budgets
Monitor performance
Appoint and evaluate the CEO
Approve appointment of medical staff
Committees (e.g. Executive Committee, Medical Staff Committee)

CEO

Administrator / President
Carry out the mission and objectives
Responsible for day-to-day operations
Leadership
Receives delegated authority from the board

Medical Staff

Page 22 of 38

Chief of Staff heads the medical staff

Accountable to the board
Physicians are formally granted admitting privileges
Chief of staff (medical director)
Chiefs of service (for specialties) in major hospitals
Committees: Executive, Credentials, Medical records, Utilization review, Infection
control, Quality improvement

Historical shift of power from the trustees, to physicians, to senior managers

Parallel operational structure (medical and administrative) creates opportunities for

conflict

To understand and differentiate between licensure, certification, and accreditation

and the Magnet Recognition Program of the American Nurses Credentialing Center
Licensure
A hospital must be licensed to operate
State government oversees w/ own set of standards
Emphasizes physical plant compliance with:
building codes
fire safety
climate control
space allocations
sanitation
Certification
Not mandatory (required only if a hospital wants to participate in Medicare and
Medicaidmost do)
A federal function
Hospitals must comply with the conditions of participationfederal standards for
health, safety, and quality
Currently revised conditions focus on quality of care delivered and the outcomes of
that care

Accreditation
Joint Commission or American Osteopathic Association
Accreditation is a private undertaking
It is voluntary for the hospital
It confers deemed status on hospitals
Deemed status is not conferred on nursing homes
MAGNET Recognition Program
Designation conferred by the American Nursing Credentialing Center
Recognizes quality of care, nursing excellence, and innovations in professional
nursing practice
Organizational environment helps attract and retain well-qualified nurses
Visionary leadership, empowerment, and collaboration create healthy work
environments, attract qualified nurses, and improve patient care

To get a perspective on some key ethical issues

Respect for others
Autonomy: empowerment
Truth telling: honesty
Confidentiality: privacy
Fidelity: duty and promises

Page 23 of 38

Beneficencebenefit to the patient

Non-maleficencedo no harm; benefits > potential harm
Justicefairness and equality
Challenges arise in treating incompetent and comatose patients
Patient Self-Determination Act of 1990
Inform patients of their rights upon admission
Main rights:
confidentiality
consent re: medical care
information on diagnosis and treatment
right to refuse treatment
formulation of advance directives

Informed Consent
Right to make an informed choice regarding medical treatment
Right to obtain complete current information on diagnosis, treatment, and prognosis
Patient-centered care: organizational culture that promotes patient involvement,
respects preferences, solicits patients inputs, and furnishes needed information and
education
Advanced Directive
Patients wishes regarding continuation or withdrawal of treatment when patient
lacks capacity to make end-of-life decisions
Three types:
1) Do Not Resuscitate (DNR)no CPR
2) Living will
Patients wishes are indicated in advance
Main drawback: Limited in scope
3) Durable power of attorney
Patient appoints someone else to make decisions
Main drawback: patients wishes may be bypassed
Ethical decision making
Ethics committees
Develop guidelines and standards
Address ethics issues
Multidisciplinary
Moral agent
Health care managers
Moral responsibility to put patient needs above those of the organization
Ethics transcends compliance with the law
1 ACA Takeawaya No more physician owned hospitals can be opened or expanded if they want to
participate in Medicare
b New requirements are imposed on nonprofit hospitals to do community health
assessments and help the needy. An excise tax is imposed for failure to comply.
CH 9 Managed Care
Review the link between managed care and earlier organizations - 336
- Managed care is an outgrowth of the combined aspects of health insurance, contract practice,
and pre-paid group practice (Figure 9-4)
- private health insurance began as a prepaid plan with Baylor Plan (1929)
- Baylor Hospital bore all the risk
- the insurance function was taken over by Blue Cross
- subsequent models let the insured decide where they would receive care

Page 24 of 38

- medical establishment prefers fee-for-service system -> capitation

- Contract practice takes on the idea of capitation by incorporating a defined group of enrollees

Grasp basic concepts of managed care 344

- utilization controls, comprehensive services, defined group of enrollees, capitation, limits fee for
service, limits choice of providers, sharing risks with providers
-Inefficiencies complex, lengthy appeals, ancillary svcs cost extra
Distinguish main types of MCOs - 349
varies by form of payment - HMO pays by capitation
- PPO non-capitation payment to providers, reimburses patient for svc
- EPO - restrict enrollees to list of providers, use GK
- POS - capitation and risk based provider reimbursement
Examine the different HMO models and their advantages and disadvantages 357
- Four (4) HMO Models - differ in their arrangements with the physicians
- Staff - employs its own docs, only serves that HMO's enrollees
- Disadvantages fixed salary can be high, expansion is difficult, limited choice
- Group - contracts multi specialty group practice to provide comprehensive care
HMO pays all-inclusive capitation to group practice, may treat nonHMO
- Disadvantages difficulty with service if contract lost
- Network - HMO contracts with more than one group practice, capitation fee paid
to group, group provides all physician svc, offers wider choice of docs
- Disadvantages dilution of utilization control
- IPA - variant of pre-paid group practice, contracts solo docs and HMO docs, HMO
pays IPA and IPA pays docs, IPA shares risks with docs, choice of providers
- Disadvantages surplus of specialists, dilution of utilization control
Why MC did not achieve cost control? - 357
- as premiums continue to grow, the employers are looking to share the cost of HC with the
employees
- employees never saw savings, lost freedom to choose providers, utilization mgt and lower
reimbursement scared providers
Understand driving forces behind organizational integration 361
- Cost pressures, concentration of powers in MCO hands, new alternatives to HC delivery -> Aim:
to provide a seamless care
Familiarize with highly integrated health care systems, namely IDS and ACOs - 366
-Integrated Delivery Systems (IDS) - network of org that provides continuum of
care for a defined population and willing to be fiscally and clinically responsible
for its group
- Accountable care organization (ACO) integrated group of providers, take responsibility for
improving health, provide cost efficient care, satisfaction-focused
- Payer-provider Integration - based on participation, ownership, consolidation
(vertical/horizontal integration)
Learn about ACA provisions that apply to managed care-369
- Managed care will play a dominant role in offering health insurance through the
exchanges
- ACA prescribes minimum medical loss ratio in health plans to limit the percentage of
premium revenue
- ACA envisions that consumer plans will emerge with consumer plans

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- ACOs are still in its infancy, and ACA adjusted Medicare with Shared Savings Plan for
ACOs
Review Questions

CH 10 Long term care

1 Comprehend the concept of long-term care (LTC) and its main features

Need for LTC is associated with chronic conditions and comorbidity that lead to
illness, disability, and death Functional incapacity necessitates LTC
LTC clients need a variety of services over time
LTC cannot be an isolated component of health care (ease of transition is
necessary)

Key Concepts of LTC:

Variety of services The elderly are a heterogeneous group. Needs vary among
people, and they also change over time.
Individualized services - Services are tailored based on individual assessment.
Well-coordinated total care - LTC providers are responsible for total care which
includes services provided by non-LTC providers.
Promotion of functional independence - The goal of LTC is to enable the
individual to maintain functional independence to the maximum level that is
practicable.
Extended period of care Most LTC clients require services over a relatively long
period of time.
Holistic care - A patients physical, mental, social, and spiritual needs and
preferences should be incorporated into medical care delivery.

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Quality of life - Quality of life take added significance in LTC because (1) a loss of
self-worth often accompanies disability, and (2) patients remain in LTC settings for
relatively long periods with little hope of full recovery in most instances.
Activities of Daily Living (ADL)
Measure of physical dysfunction in the elderly
6 basic activities:
Eating
Bathing
Dressing
Using the toilet
Maintaining continence
Transferring from bed to chair
For community living:
Grooming
Walking a distance of eight feet
Instrumental Activities of Daily Living (IADL)
Measures activities that are necessary for living independently in the
community
Require higher cognitive functioning than ADLs (are not purely physical)
10 activities:
Using the telephone
Driving a car or traveling alone in a bus or taxi
Shopping
Preparing meals
Doing light house work
Taking medicine
Handling money
Doing heavy housework
Walking up and down stairs
Walking a half-mile without help

Overview of the main LTC services (9 services)

Medical Care
Post-acute continuity of care
Management of chronic conditions
Treatment of physical and mental dysfunction
Mental Health Services
Mental disorders not a normal part of aging (affect 20% of the elderly)
Diagnosing is a challenge in the elderly
Anxiety, depression, delirium, and dementia are common
Social Support
Changing life events require coping and adaptation
Conflict often arises between
Patient and family
Patient and caregivers
Total care needs (i.e., whatever a patient needs within or without the
long-term care system) must be coordinated
Link with the community and the outside world are important
Preventive and Therapeutic Long-Term Care
Prevent and postpone disease and disability
Prevent or delay institutionalization
Restoration of temporary loss of function when institutionalized
Informal and Formal Care
Most LTC service is informal care by family and friends (donated care)

Page 27 of 38
Donated care largest source of financing for LTC costs
Reduces the use of formal home health care and delays nursing home
entry
Respite care can provide temporary relief to caregivers
Shrinking pool of informal caregivers in relation to growing elderly
population (divorced, unmarried, or without children)
Community-Based and Institutional Services
Community-based services have an important preventive function for
those who do not have informal support
Institutionalization: When high levels of physical or cognitive
impairments are present
Help with Activities of Daily Living (ADLs)
Prevention of further degeneration
Levels of Intensity
Personal care - basic ADL assistance (e.g., bathing); informal care or
care provided by paraprofessionals
Custodial care - maintenance of functioning; prevent decline
Restorative care - professional therapies and basic functional
maintenance
Skilled nursing care - clinical care provided by licensed nurses under
the direction of a physician
Subacute care - postacute, technically complex services
Housing
Supportive physical features
Congregate housing: support services and companionship (e.g. meals,
housekeeping, transportation, social activities)
End-of-Life Care
Prevent needless pain and distress for the terminally ill
Dignity and comfort
Care provided by institutional staff or hospice services

Identify who needs LTC and why (5 different groups)

Older Adults
In 2006, the elderly constituted 12.5% of the US population
By 2030, 20% of the population is projected to be 65 years and older
Majority use community-based LTC services (> 80%)
Elderly in the lowest socioeconomic status are at the greatest risk of need
for LTC, and are also the least able to pay for such services.
Children and Adolescents
Birth-related disorders (cerebral palsy, autism, etc.)
Developmental disabilities (DD)
Mental retardation (MR)
Care available in special pediatric and MR/DD facilities
Young Adults
Neurological disability, degenerative conditions, serious accidents (auto,
sports, and industrial), post-surgical complications
Adults with MR/DD - This population is aging too (average life expectancy
of 66 years; age 50+ are considered elderly)
People with HIV/AIDS
Now a chronic condition thanks to drug therapies
Nervous system disorders, infections, dementia, psychiatric disorders
Weight loss and incontinence
People Requiring Subacute or Specialized Care
Postacute complex care

Page 28 of 38

Ventilator, head trauma, Alzheimers services

Identify the different types of community-based LTC services & who pays for
these services
4 Fold Objectives:
1

Deliver care in the most economical and least-restrictive setting

Supplement informal care

Provide respite care

Delay or prevent institutionalization

Funding souces: MEDICAID; other public and private sources

Types of Community-Based LTC services (9 Services)

Home Health Care

Community or hospital-based agency
Services must be approved by a physician
After 1996, Utilization declined as a result of the 1997 Balanced Budget
Act
Restrictions on home health coverage
Development of prospective payment system
Medicare benefits are limited to skilled nursing care
Adult Day Care

Page 29 of 38
Clients stay with family/friends, but cannot be left alone during the day
An important respite program
3 models:
Health-rehabilitative model
Health-maintenance model
Social-psychological model
Adult Foster Care
Family environment in small community-based dwellings
Services primarily focus on room and board, supervision, and light ADL
assistance
Senior Centers
Local community centers
Socializing
Many offer one or more meals
Offer wellness programs, education, counseling, recreation, health
screening,...
Home-Delivered and Congregate Meals
Elderly nutrition program
Hot noon meal, 5 days per week
Home delivered meals: meals-on-wheels
Senior centers and other congregate settings
Homemaker Services
Shopping, light cleaning, errands, minor home repairs,...
Emergency Response and Telephone Reassurance
Personal emergency response systems (PERS)
Friendly calls by agency personnel or volunteers
Case Management
Matching client needs with appropriate services
Needs assessment; care plan; specify services; determine eligibility;
arrange financing; referral and follow up; reevaluate
Hospice Care
Palliative care in place of aggressive treatment
A variety of social and supportive services for the patient and family
are included

Name the types of LTC institutions and levels of service they provide (5 types)

Independent or Retirement Living Centers

Emphasizes independence, housing, and social support
Generally, no clinical services are provided
Private funds, some subsidized by the government
Residential or Personal Care Facilities
Emphasizes housing and social support
Minimal health care: supervision, personal care (drug use management,
help with light ADLs)
Not equipped to provide professional clinical care
Private-pay, Supplemental Security Income (SSI) payment
Assisted Living Facilities
Personal care services; 24-hour supervision; scheduled and unscheduled
assistance; social activities; some health care services provided by
licensed nurses and therapists
Regulation and oversight is at the state level (no federal regulations)
Most common ADL assistance is with bathing, dressing, and toileting

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Mostly private-pay; limited Medicaid coverage in some states
Skilled Nursing Facilities (SNF)
Heavily regulated through licensure (through state) and certification
(through federal/ CMS) requirements
Certification allows a facility to receive Medicare and/or Medicaid funding
Federal certifications:
For Title 18 (Medicare)SNF, freestanding or distinct part
For Title 19 (Medicaid)Nursing Facility (NF)
Dual certificationSNF and NF

Subacute Care Facilities

Subacute care is found in 3 types of institutions:
1. Transitional care units (extended care units) in hospitals: SNF certification
2. Skilled care nursing homes
3. Long Term Care Hospitals (certified as acute care hospital)
Reimbursement differs in different settings
No uniform basis for evaluating quality across the three settings
Definition of a Subacute Care
Subacute care is a level of care needed by a patient who does not require
hospital acute care, but who requires more intensive skilled nursing care
than is provided to the majority of patients in a skilled nursing facility.
Subacute patients are medically fragile and require special services, such
as inhalation therapy, tracheotomy care, intravenous tube feeding, and
complex wound management care.

Page 31 of 38

Overview of specialized LTC facilities

Inpatient Rehabilitation Facilities

Intermediate Care Facility for the Mentally Retarded
Alzheimers Facilities
Continuing Care Retirement Communities

Federal regulations mandate Preadmission Screening and Resident Review (PASRR) for
anyone who may be in need of either community-based or institutional long-term

Understand the nursing home industry and its patients

Industry Overview
Nursing home beds declined from 52 beds per 1,000 elderly population in
1999 to 48 beds per 1,000 in 2004. Community-based alternatives have
expanded.
93% of the beds are dually certified
Average facility size: 107.6 beds; 86% occupied
Most facilities are operated by multifacility proprietary chains
Financing
National expenditures for the nursing home industry are the lowest
compared to other main sectors
Rate of increase has been the lowest compared to other sectors
Medicaid is the largest payer; private payments cover 39%
Medicare provides only limited benefits for SNF, Part A
3.5% of Medicaid beneficiaries receive nursing home care, but consume
22% of Medicaid expenditures

Learn about sources of financing

Page 32 of 38
Many patients enter nursing homes as private payers, but once they
reach the spend-down limits they qualify for Medicaid
Private long-term care insurance has seen slow growth. Main issues:
affordability, too many options can be confusing, risk selection

Slow growth of private insurance

Because of so many variables, trying to decide the right coverage can be a
daunting task.
For most people, the premiums are unaffordable.
Premiums depend on coverage options
Most people think that Medicare would pay for LTC services when needed, but
Medicare
covers only short-term post-acute care after discharge from a hospital.
Expensive if purchased later in life
Public policy has created few incentives to spur the growth of LTC insurance.

Survey Medicare/Medicaid participation requirements- ACA Take-Away

ACA Takeaway
Some support through financial incentives is available to help states transition their LTC
systems toward a better balance between institutional and community-based services.
A 60-day written notice and a plan for relocating residents are required prior to the closure of
an SNF or NF.
To participate in Medicare and/or Medicaid, nursing facilities must institute effective
compliance and ethics programs.
Ch 11. Special population health service
Chapter 12: Cost, Access and Quality

Multiple Choice Questions

1. What is Gross Domestic Product (GDP)?
a. A measure of all the goods and services produced by a nation in a given year
b. A measure of all the goods and services produced by a nation in a given year, divided
by the population
c. A measure of all the goods and services produced by a nation in a given year, minus the
amount of money spent by the government
d. A measure of all the goods and services produced by a nation in a given year, divided
by the amount of money spent by the government
2. What is a PRO?
a. Price Rationing Organization
b. Political Review of Outcomes

c. Peer Review Organization

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d. Presidents Review of Organizations

3. What is meant by the term health care costs?
a. The price of health care
b. How much a nation spends on health care
c. Cost of producing health care
d. All of the above
4. Medical cost inflation is influenced by all of the following factors except:
a. Waste and abuse
b. Increase in elderly population
c. Decrease in uninsured
d. Growth of technology
5. What are administrative costs?
a. Costs associated with management of the financing, insurance, delivery, and payment
functions of health care
b. Costs associated with financing and insurance only
c. Costs associated with delivery and payment functions only
d. None of the above
6. What is the main reason for the lack of success of health care cost control efforts in the U.S.?
a. Malpractice lawsuits
b. Cost shifting by providers
c. Dislike of the practice by consumers
d. Growth of technology
7. Fill in the blank: The distinction between predisposing and enabling conditions can be applied
to assess the _______ of a health care system.
a. cost
b. equity
c. efficiency
d. effectiveness
8. What is the purpose of clinical practice guidelines?
a. To provide a plan to manage a clinical problem based on evidence or consensus
b. To lower costs

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c. To improve outcomes
d. All of the above
9. What is the Health Plan Employer Data and Information Set (HEDIS)?
a. A quality report card
b. A cost report card
c. A government database on health plans
d. None of the above
10. What are the main activities of risk management?

a. Proactive efforts to prevent adverse events related to clinical care and facilities
operations
b. Retrospective studies of adverse events
c. Both a and b
d. Neither a nor b

Chapter 13: Health Policy

Multiple Choice Questions:

1. Which major public insurance program was legislated in 1965?

a. Medicare
b. Medicaid
c. Both a and b
d. Neither a nor b
2. Health policies are used in what capacity?
a. Regulation of behaviors
b. Allocation of income, services, or goods
c. Both a and b
d. Neither a nor b
3. What is incrementalism?
a. The fact that in the U.S., health care is financed by multiple entities
b. The fragmented, uncoordinated delivery of health services

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c. Small policy changes that reflect a compromise amongst different groups demands
d. None of the above
4. Which of the following branches of government is a supplier of policy?
a. Executive
b. Legislative
c. Judicial
d. All of the above
5. What is an interest group?
a. A group of lawmakers within Congress with a particular area of interest
b. A group of appointed judges with a particular political view point
c. An independent, non-governmental group united by a policy area, which lobbies and
advocates its point of view to lawmakers
d. None of the above
6. What was the main purpose of the Kerr-Mills program (1960)?
a. Provision of federal grants to state government programs assisting the elderly
b. Provision of federal grants to state government programs assisting the poor
c. Provision of federal grants to state government programs assisting children
d. None of the above
7. For what is the National Health Planning and Resources Development Act of 1974 noted?
a. The shift from cost containment to improvement of quality as the principal theme in
federal health policy
b. The shift from cost containment to improvement of access as the principal theme in
federal health policy
c. The shift from improvement of access to cost containment as the principal theme in
federal health policy
d. The shift from improvement of quality to cost containment as the principal theme in
federal health policy
8. What does CON stand for?
a. Certificate of Need
b. Certificate of Nursing
c. Certificate of Naturopathy
d. Certificate of Nationality
9. In what way does research influence policymaking?

a. Prescription

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b. Documentation
c. Analysis
d. All of the above
10. All of the following were identified by the Institute of Medicine (Crossing the Quality Chasm,
2001) as areas for quality improvement, except:
a. Timeliness
b. Safety
c. Efficacy
d. Patient-centeredness
USHS Chapter 14- Review Questions
1. Explain the eight main forces that will determine future change in health care.
538-545
ANSWER 1: The 8 forces are:
(1) Social and demographic
(2) Political
(3) Economic
(4) Technological
(5) Informational
(6) Ecological
(7) Global
(8) Anthro-cultural
2. In what way should the delivery infrastructure change to meet the needs of a
larger number of insured Americans subsequent to health care reform? 550-551
ANSWER 2: The infrastructure will evolve by incorporating the models and concepts in this
section such as the medical home model, community-oriented primary care (CPOCs), patientcentered care, having future payment methods incorporate at least one value component, have
providers trained to practice in a wellness-oriented model of care delivery, more training in
geriatrics, revised training of PCPs to become comprehensivists.
3. What is patient activation? What are the main challenges in activation? 552-3
ANSWER 3: Patient activation refers to a persons ability to manage his/her own health and
utilization of healthcare. Activation necessitates patients to acquire some basic knowledge and
skills and to be motivated to make effective decisions about their own health in partnership with
their health care providers.
4. What recommendations have been made to transform the nursing profession?
553-4
ANSWER 4: Four recommendations have been put forth

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(1) Nurses should practice to the full extent of their education and training
(2) Nurses should achieve higher levels of education and training through an improved
education system that promotes seamless academic progression
(3) Nurses should be full partners with physicians and other professional in redesigning health
care
(4) Effective workforce planning and policy making require better data and improved
information systems. Data collection and analysis should drive a systematic assessment
and projection of workforce requirements by role, skill mix, region, and demographics to
inform changes in nursing practice and education

5. What training is needed for primary care physicians to become

comprehensivists? 554-5
ANSWER 5: Training will need to be more efficient, integrated, and longitudinal. Will also need a
reformed payment model that incorporates education and outcomes. Comprehensivists will
need to be experts in:
(1) Anticipating, preventing, and managing the progression and/or complications of common
complex conditions
(2) Managing complex pharmacology
(3) Understanding end-of-life issues and medical ethics
(4) Coordinating care
(5) Leading health care team
6. What are some of the main reasons behind the deficits in geriatric training?555
ANSWER 6: Only 600 med school faculty out of 100,000 list geriatrics as their primary specialty.
Only 3% of med students take any elective geriatric courses. In other disciplines as well, the
majority of educational curricula do not require geriatric training (ex: 60% of nursing schools
have no geriatric faculty)
Problems has been ignored, even though elder care by geriatric professional yields better
outcomes w/o cost increases.
7. What are the main challenges faced by long-term care in the future? 555-6
ANSWER 7: financing and delivery of LTC will remain a major challenge in the future. The
National Commission for Quality Long-Term Care identified 6 main areas of concern that must be
addressed: (1) Financing, (2) Resources, (3) Infrastructure, (4) Workforce, (5) Regulation, and (6)
Information technology. Additional proposals include a focus on support for family caregivers,
ease of access and affordability, choice of settings and providers, quality of care and life, and
effective transitions and organization of care.
8. Give an overview of what new technology might achieve in the delivery of health
care. 557, 558-560
ANSWER 8: Interoperable IT systems will enable providers to track patients care across care
settings. This will aid with smooth transitions between care settings, as currently there are
disconnects due to high rates of missing or inaccurate information (think LTC and non-LTC
frequent transitions in the elderly).

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New technology that might advance healthcare delivery include genetic mapping, personalized
medicine and pharmacogenomics, drug design and delivery, imaging technologies, minimally
invasive surgeries, vaccines, blood substitutes, xenotransplantation, and regenerative medicine.
9. What role does international cooperation play in globalization? 557-8
ANSWER 9: Global travel can spread infectious diseases, increasing antibiotic resistance.
International cooperative efforts include the Biological Weapons Convention (BWC) and the
International Health Regulations (IHR). The CDCs Global Disease Detection Program will be
increasingly involved in global surveillance, detection, and control. A similar effort will be
undertaken by the Global Emerging Infections Surveillance and Response System by the DoD.
10.
What can be done to achieve greater adoption of evidence-based medicine
in the delivery of health care? 561-563
ANSWER 10: 5 strategies to improve guidelines and protocols and their adherence:
(1) Healthcare leaders must continue to emphasize adoption of evidence-based guidelines
that are revised and updated in light of new research
(2) Ongoing development of computer-based models incorporating EBM will facilitate
multidisciplinary caregiving based on best practices by various practitioners
(3) Robust clinical trials will be the backbone of EBM- adherence is higher when the
recommendations are supported by RCTs
(4) Future practice guidelines must incorporate economic analysis to promote the delivery of
cost-effective healthcare
(5) Financial incentives, including provider payments and patient cost sharing, must be
restructured.