User:CheshireKatz/Health

HEALTH LAW

INTRODUCTION

Access

Costs → in 2002, we spend 14.9% of GNP on health care! Through the 1990s, health expenditures as a share remained fairly constant, since then, they have gone up again

We spent over $5,000 per person on health care in the US. In recent decades, health care costs increase faster than consumer price index

What do we spend all that money on? 1/3 – hospital. services, 1/5 – physician services, 10% - prescription drugs (have doubled recently, services have gone down)

Who pays? In 2002, it was 36% private health insurance, 19% Medicare, 17% Medicaid, 16% out of pocket

In recent decades, Medicare has been bigger than Medicaid, but it’s expanding

We spend a lot more than any other country (Germany – 59% of what we spend per capita, Britain – 39% and they provide universal health care!)

Costs create huge problems! For individuals, for businesses, for state gov’ts – can be the largest budget line, for fed, gov’t

Financing is incredibly complex, but also key to understanding the issues

Quality → sometimes magnificent, but often the quality of care provided is poor. Focus on alternative ways of defining and influencing quality

Managed care → claims review. Even if you are insured, sometimes you don’t get the $$!

Access, Cost, and Quality in relation to services at the beginning of life and at the end of life

ACCESS TO HEALTH CARE

BARRIERS TO ACCESS

The Rise and Crisis of Provider-Dominated Health Care

1887 – 1910 – The turn of the century

Physicians

Prior to the 19th century, healers were low status and low paid, often women (herbalists, midwives, abortionists)

Paid like barbers – service providers, not professionals

What happened to change that?

Stunning developments in technology and science and the understanding of germ theory

Allopath (germ guys) believed that their theories about treating people were so superior to the herbalists – they enlisted the power of the state to:

Prohibit practice by anyone not licensed by the state – confined the practice of medicine

Persuaded legislatures to put control in the hands of the allopath themselves

State should provide for general rather than specialized licensing

What kinds of problems were we trying to address?

Bad medical care

Why did we reject the other options?

The power of the allopaths was great.

Distrust gov’t control

The best deciders here were the doctors themselves

Hospitals

PGH and Bellevue were the first hospitals – established as the infirmary wards of almshouses

The only gov’t support we had for people who couldn’t work was the almshouses

When those people got sick, they were sent to the infirmary ward

Good place to students to get some practice

Only cared for poor people – the notion that a respectable person would go to a hospital. was crazy! They received care in their own homes

Private hospital. began to crop up; viewed with great distrust; served the teaching purpose

By 1873, there were only about 178 hospital., and most were mental

By 1910, there were over 4,300 hospital. in the US

Non-profit, charitable institutions, governed by the doctors who worked there

Medical education

In the 1880s, medical education was simple: entrance requirements were lower than that to a good high school

Other doctors trained as apprentices

Now oriented to acute specialty based hospital. care

Science, care, and professional power

Immense expenditures for sophisticated surgery, drugs, and diagnostic tests, and an astonishing inability to address the political, social, and behavioral causes of most illness and injury

Turned towards individualistic, procedure-focused services delivered by thousands or for-profit businesses and formally charitable but actually profitable larger businesses

The rise of public health insurance: 1930-1980

Government run health care fiercely opposed by profession

Restricted to inadequate programs for minorities, better programs for the armed services and veterans

1935 – The Great Depression

Hospital. had proliferated, no health insurance, common for hospital. and doctors to offer a sliding fee scale for services

full pay ←→ charity and something in between

That worked until the GD, and then no one could pay

Hospital .were in desperate financial shape

Baylor model → school and hospital, no patients – began to contract with the local education system to say if every teacher pays x per month, then when they are sick, they can receive care from the hospital.

Three forms of private health insurance

Indemnity benefits (patient seeks reimbursement)

Service benefits (Blue Cross and Blue Shield, doctors and hospitals participate in plan and accept plan’s payments for services)

Direct services (services provided by the same organization to which a monthly premium is paid)

The struggle over private health insurance

AHA promulgated Blue Cross

Any licensed hospital could use symbol and accept patients and payments

The state authorized the creation of an insurance co that doesn’t need to meet the normal financial requirements that enable a firm promise of delivery

The hospital. that participated promised to provide care – less need for the financial reserve (insurance didn’t need level of security)

State must ensure that the system served the community → the plan would be open to anyone in the community, and everyone would be charged the same rate

Couldn’t charge more to higher risk patients

Guaranteed access at uniform price

Every hospital. in community that was licensed is entitled to join the plan

Unlike Baylor, you could pick any hospital. in the community

AHA owned the Blue Cross trademark

Must be controlled by hospital. community reps

Baylor had too much control over the doctors, under BC plan, doctors could choose where to send their patients

Hospital. themselves were collectively in control of the insurance plan

Blue Shield

Mixed indemnity and service benefit plan

Doctors agreed to accept plan payments for lower income patients, but retained the right to charge middle and high income patients more

National health insurance

1935 – adopted social security, unemployment, AFDC, etc. to deal with the GD crisis

We didn’t adopt national health insurance

Opposition of medical profession very intense

Blue cross – it made the most sense at the time

Pattern continued well into the 50s

During WWII, we had wage and price controls – big demand for expanding

At the end of WWII, soldiers who had gotten good health care when in the services wanted to continue that level

Enter commercial insurers

Different attitude – they want to exclude high risks and charge different rates

Consequence – left the Blues to cover those rejected by commercial

Blues abandoned open enrollment and the commercial insurers continued to grow

Blues become more and more $$ -particular impact on the elderly – easy to ID as a bad risk

Politically motivated

1965 → Medicare and Medicaid

How hospitals and doctors came to be paid

Developed in 1950s, by 1960s, provider-dominated health financing was firmly in place

Based on “reasonable costs”

Evolution of government’s role in health care

NIH – federally funded research

Medicare

Fed. program financed by payroll taxes

Universal eligibility for over 65 or sufficiently disabled

Provides basic coverage for medical services

Does not provide long term care, preventative care, prescription drugs

Administered by gov’t (formally) day to day admin delegated to local Blues offices

Part A → hospital insurance for the elderly

Part B → medical coverage for persons over 65

Medicare package is too meager for people who are really poor – more of a catastrophic coverage

As a practical matter, most Medicare people also purchase a gap filler

Medicaid

Federal matching funds for state medical assistance programs for the poor

For poor people

A bit of an afterthought

Not wholly fed – cooperative state-fed program

Each state decides, but must meet fed standards

Entitled to fed matching funds for whatever they spend

States have huge discretion in terms of what kind of program they want to create

Most states have chosen to provide a relatively comprehensive package

The crisis of the provider-dominated system

Rising costs

Costs were still determined in large part by the private sector itself

Advances in technology

Quality

Inefficient, unregulated, and often medically unnecessary

Responses to cost escalation and the emergence of managed care

Price controls, review of doctors’ decisions, and financial incentives

Managed care → the functions of insurance and delivery of health services are integrated into a single corporate arrangement that both insures groups and delivers covered benefits through a defined network of participating providers

HMOs, individual practice associations, PPOs, integrated service systems, POS plans, provider networks

Assumption of a contractual duty to furnish covered care and services

Provision of services through specified provider networks, which are themselves under contract to the managed care entity

Advance control over actual utilization of benefits by both providers and patients

Use of financial incentives in order to influence provider practice and resource utilization

Quality and cost control systems that include credentialing, practice reviews and guidelines, and the reporting of practice data which are used to control providers’ access to the market

National health care reform and the clash of fundamental values

A brief anatomy of national health care reform

Who will pay?

How will the vast sums of money that flow through the system be controlled, contained, and allocated to different types of providers, suppliers, managers, investors, and others?

1994 – defeat of Clinton’s health care reform proposal

Very complex program – universal coverage administered by orgs., designed to appeal to a broad range of interests

Rejected fairly soundly

too complex for anyone to understand

Congress more generally has difficult time adopting complex legis.

Insurance industry that did not want the plan did a brilliant job through using the media (Harry and Louise commercials)

Things that they feared are perfectly legitimate!

Takes away choice

The truth → the fears and objections to the Clinton plan are precisely the issues that we are faced with today

Built on American tradition of relying on private corps to weave the safety net to provide basic health benefits, etc. then we have gov’t programs that come in to fill in the gaps (ERISA)

Conflicting values in American health care

Autonomy – professional control

Preferable to any other model – too complex to be legitimately subject to the forms of control that work in other areas (the market, bureaucrats)

Expertise and knowledge

Education and ethics provide a commitment to patient service

But that’s not their area of expertise!

Dominant way that the system was shaped

Remains very powerful today, particularly in response to the perceived excesses of managed care

Equality

It’s not a desired good – nobody wants to undergo surgery

Need is generally episodic and unpredictable

Emergency health needs are different

Market competition

Arose in the 70s in response to the other paradigms

There’s nothing special about health care! It’s not life or death; it’s optional and .'. should not be treated any differently

People don’t confront financial barriers at the time of care and are not cost conscience shoppers