Research Paper One

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Course Learning Outcomes for Unit I

Upon completion of this unit, students should be able to:

1. Compare and contrast health services organizations within the healthcare system. 1.1 Explain the primary organizational components of the healthcare system and the

commonalities and differences among health services organizations.

Reading Assignment

Chapter 2: Why and How Health Care Organizations Need to Change, pp. 13-34

Chapter 11: Leading Change: First Steps in Employing Strategic Intelligence to Get Results, pp. 259-310

Unit Lesson

The Ideal Health System

Imagine you are now the Secretary of Health and Human Services; you have a magic wand and you can create the perfect healthcare system. What components would it have? Would it include:

1. improving health outcomes for individuals, families and communities, 2. defending your population against threats to their health, 3. protecting your population against financial the consequences of bad health, 4. providing access to all with equality and no disparity, and 5. making it possible for people to make decisions in their own plans of care as well as have input into

the decisions that affect your country’s overall health system?

If you answered yes to these components, your definition matches the World Health Organization’s Components of a Healthcare System (2010).

How This Course & Content Have Real-Word Application

We are witness to history and are living in one of the most active times in our country’s history for healthcare reform. In 1966, the Medicare Act was signed into law by President Johnson, the most significant piece of healthcare legislation in our country to that point. Fast forward from 1966 to 2010 and the passing of the Affordable Care Act, which arguably is the second most impactful piece of legislation on U.S. health care since the Medicare Act.

Medicare has grown significantly since 1966 and is now about 14% of our national budget, covering 47 million Americans (Kaiser Family Foundation, 2015). Government health plans (Medicare, Medicaid, Tri-Care, Veteran’s Administration) are growing and are on pace to insure more lives in the near future than lives covered by commercial plans (Cigna, United, Blue Cross, etc.)

Speaking of this growth, Sylvia Burwell, Health & Human Secretary Director, announced that by 2018 the Centers for Medicare/Medicaid Services (CMS) will have up to 50% of its payments be value-based (Bundled Rates, Accountable Care Organizations, Pay for Performance, etc.) (Bresnick, 2015). This growth and this shift to value-based reimbursements are causing significant change within our healthcare delivery systems.

UNIT I STUDY GUIDE

Componentsof a Healthcare System

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UNIT x STUDY GUIDE

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It is crucial for you to understand that change is on our doorsteps and that we have our feet in both the past payment world of Fee for Service and the next generation of payment method of Pay for Value. In this new

value-based payment landscape, providers realize we need to do things more efficiently and with better outcomes. Your ability to master efficiency and quality improvement skills are key to your success.

Let’s focus into two vital areas:

1. explaining the primary organizational components of the healthcare system, and 2. understanding the commonalities and differences among health services organizations.

Explaining the Primary Organizational Components of a Healthcare System

Let’s explore different organizational components and stakeholders which comprise our healthcare system.

1. Federal Government:

 Legislative Branch: Congress (House & Senate), which ironically exempted themselves from the Affordable Care Act (Korte, 2013).

 Executive Branch: o The Centers for Medicaid & Medicare Services (CMS) are in the Executive Branch. They

create regulations for healthcare industries and have administrative oversight for all Health and Human Service programs.

o The President is the Chief Executive and has strong sway in our healthcare system, including powers to veto a law, to appoint the Health and Human Services Secretary, and to promote new healthcare laws.

 Judicial Branch: We saw the Supreme Court play heavily into the Affordable Care Act, deeming that the individual mandate for a citizen to carry health insurance could constitutionally be upheld if it was a tax, thus the IRS code was amended and we now pay a tax penalty if we do not have qualifying health insurance.

2. State Government:

 DHHS: Each state has its own Department of Health and Human Services (DHHS), which takes its direction, in part, from CMS and its state legislature.

 Enforcement: Each state has its own enforcement agencies to ensure providers are complying with federal and state laws and regulations. Examples include the state’s DHHS, Office of Inspector General (OIG) and Attorney General (AG). These state agencies and departments have many tools at their disposal to enforce compliance including: o Civil Money Penalties (CMPs) o Ban on New Admissions for a health facility until the deficient practice is resolved. In some

cases, owners can be excluded from participating again in Medicare or Medicaid programs. See that Exclusion List at http://oig.hhs.gov/exclusions/background.asp

 State Legislatures: The legislatures strive to keep a balance between what they want for their state citizens and what the federal laws and regulations demand. There is often strong negotiation between states and CMS and the White House on matters. For example, high level negotiations took place between state governors and CMS on how the Affordable Care Act is rolled out in a given State, i.e. what CMS will allow under interpretation for the State Exchanges, etc.

3. Providers:

 Imagine the hundreds of types of healthcare service providers and services. Click here to see a list of providers, which can serve as inspiration for you if you have not yet decided on your healthcare career path or where you want to specialize.

4. Employers:

 Employers have played a strong role in our healthcare system. Most countries simply have health insurance offered by the government and it is paid for by income taxes, but in the United States, we often pay our health insurance premiums through our employer’s group health plan (EGHP).

5. Associations:

 Providers and employers band together in professional associations to have a stronger voice. Associations such as the American Association for Retired Persons (AARP) are a major component and large voice for healthcare advocacy.

6. Payers:

 In the United States, we have a “Third Party Payer” system, where insurance companies (Blue Cross, United, Cigna, Aetna, etc.) play a significant role. Some feel that third party payers are an

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Title extra layer of cost, while others feel they help keep downward pressure on providers to keep costs low.

7. Suppliers:

 These include Durable Medical Equipment (DME) suppliers, pharmaceutical companies, and supply companies. The role of “Big Pharma” cannot be understated as a component and an impact on our healthcare system.

8. Patients (you and me):

 Patients should really be first focus in health care and at the heart of policy and law making. Some suggest that our elected officials sometimes have the interest of large corporations at heart more than its citizens. Below are two thoughts on how our congressmen affect health care and can be affected by large companies. o One example is FDA officials becoming well paid executives at big pharmaceutical

companies, on whose behalf they just made a decision. Some suggest that a law requiring a “Cool Off” period for former government employees would help solve this ethical issue.

o Some suggest that term limits on senators and congressman would help solve issues of legislators passing laws that favor large corporations which contribute to their reelection campaigns.

Understanding The Commonalities and Differences Among Health Services Organizations

Health Service Organizations include every type of health facility and service you can imagine, including hospitals, clinics, medical groups, nursing homes, assisted living facilities, home health agencies, hospice agencies, and dialysis clinics. Each organization has commonalities but naturally strives to differentiate and enhance its service to be the provider of choice in that market. Your ability to add value to your health service organization will be key to the positive impact you will make.

This course and the future units will explore advanced healthcare strategies to enhance your knowledge and skill.

References

Bresnick, J. (2015). Medicare will be 50% accountable care, bundled payments by 2018. E.H.R Intelligence. Retrieved from https://ehrintelligence.com/news/medicare-will-be-50-accountable-care-bundled- payments-by-2018

Kaiser Family Foundation. (2015). The facts on Medicare spending and financing. Retrieved from http://kff.org/medicare/fact-sheet/medicare-spending-and-financing-fact-sheet/

Korte, G. (2013, September). Why congress is (or isn’t) exempt from Obamacare. USA Today. Retrieved from http://www.usatoday.com/story/news/politics/2013/09/27/is-congress-exempt-from- obamacare/2883635/

World Health Organization. (2010, May). Key components of a well functioning health system. Retrieved from http://www.who.int/healthsystems/publications/hss_key/en/