Healthcare Policy & Law
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HSA405Chapter4.docx
CHAPTER 4
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HEALTHCARE QUALITY
It is well documented that the United States spends more on health care than most other developed countries (the $8,508 per person spending in the United States is more than two-and-a-half times the average of other developed countries), 48 yet frequently the care provided does not result in good health outcomes. While the United States does some things very well, such as screening for and treating cancer, the country lags on measures relating to primary care services. For example, the United States ranked 31st in infant mortality over a three-year average (2009–2011), and has much higher hospital admission rates for complications due to asthma and diabetes as compared to other developed countries. 48
Researchers and policymakers have highlighted the need to improve the quality of care provided in this country. A 2003 landmark study raised many quality concerns, including findings that patients only received the appropriate medical care 55% of the time and that patients were much more likely not to receive appropriate services than to receive potentially harmful care. 49 The lack of appropriate care was seen across medical conditions, similarly affecting treatments relating to preventive care, acute care, and for chronic diseases. 49 (p2641) The degree to which patients received appropriate care varied greatly. For example, only 10% of patients with alcohol dependence received the standard of care, as opposed to 78% of those with senile cataracts. 49 (p2641)
In 2001, the Institute of Medicine (IOM) released Crossing the Quality Chasm: A New Health System for the 21st Century, which represented nothing less than an urgent call to redesign the healthcare system to improve the quality of care provided. 50 The IOM attributes our inability to provide consistent, high-quality health care to a number of factors, including the growing complexity of health care, including quickly developing technological advancements; an inability to meet rapid changes; shortcomings in safely using new technology and applying new knowledge to practice; increased longevity among the population, which carries concerns relating to treating chronic conditions in a system better designed to address episodic, acute care needs; and a fragmented delivery system that lacks coordination, leading to poor use of information and gaps in care. 50 (pp2–4) In its call to redesign the healthcare system to improve quality, the IOM focuses on six areas of improvement: safety, efficacy, patient-centeredness, timeliness, efficiency, and equity. 50 (p43)
Safety: In a safe healthcare system, patients should not be endangered when receiving care that is intended to help them, and healthcare workers should not be harmed by their chosen profession. 50 (p44) In an earlier report, To Err Is Human, the IOM found that deaths due to medical errors in hospitals could be as high as 98,000 annually and cost up to $29 billion, over half of which is attributable to healthcare costs. 51 (pp1-2) A safe healthcare system also means that standards of care should not decline at different times of the day or week or when a patient is transferred from one provider to another. In addition, safety requires that patients and their families are fully informed and participate in their care to the extent they wish to do so. 50 (p45)
Efficacy: While scientific evidence regarding a particular treatment’s effectiveness is not always available, an effective healthcare system should use evidence-based treatments whenever possible. This includes avoiding the underuse of effective care and the overuse of ineffective care. 50 (p47) Evidence-based medicine is not limited to findings from randomized clinical trials, but may use results from a variety of research designs. To promote the use of evidenced-based medicine, healthcare providers and institutions should improve their data collection and analysis capabilities so it is possible to monitor results of care provided. 50 (p48)
Patient-centeredness: A patient-centered healthcare system is sensitive to the needs, values, and preferences of each patient, includes smooth transitions and close coordination among providers, provides complete information and education at a level and in a language patients can understand, involves the patient’s family and friends according to the patient’s wishes and, to the extent possible, reduces physical discomfort experienced by patients during care. 50 (pp49–50) A language or cultural barrier may be a significant hurdle to receiving high-quality and patient-centered care. One in six Americans speak a language other than English at home. 52 Individuals with language barriers are less likely to adhere to medication regimes, have a usual source of care, and understand their diagnosis and treatment, and are more likely to leave a hospital against a provider’s advice and miss follow-up appointments. While use of interpreters can improve a patient’s quality of care, when friends or family members serve as interpreters, there is greater risk that the interpreter will misunderstand or omit a provider’s questions, and that embarrassing symptoms will be omitted by the patient. 52 (p2) Similarly, cultural differences between provider and patient can result in patients receiving less than optimal care. Cultural differences can define how healthcare information is received, whether a problem is perceived as a healthcare issue, how patients express symptoms and concerns, and what type of treatment is most appropriate. As a result, healthcare organizations should ensure that patients receive care that is both linguistically and culturally appropriate. 53
Timeliness: A high-quality healthcare system will provide care in a timely manner. Currently, U.S. patients experience long waits when making appointments, sitting in doctors’ offices, standing in hallways before receiving procedures, waiting for test results, seeking care at emergency departments, and appealing billing errors. 50 (p51)These can take an emotional as well as physical toll if medical problems would have been caught earlier with more timely care. Timeliness problems also affect providers because of difficulties in obtaining vital information and delays that result when consulting specialists. In addition, lengthy waits are the result of a system that is not efficient and does not respect the needs of its consumers. 50 (p51)
Efficiency: An efficient healthcare system makes the best use of its resources and obtains the most value per dollar spent on healthcare goods and services. The uncoordinated and fragmented U.S. system is wasteful when it provides low-quality care and creates higher than necessary administrative and production costs. 50 (p52) As indicated previously, the high level of spending and poor outcomes relating to preventable conditions, the number of patients who do not receive appropriate care, and the high number of medical errors make it clear that the quality of healthcare services provided can be improved.
In addition, significant geographic variations in the provision of healthcare services suggest a lack of efficiency in the system; however, this is a complicated issue to understand and solve. For example, the Dartmouth Atlas Project has studied regional variations in healthcare practices and spending for several decades. Even after controlling for level of illness and prices paid for services, researchers have found a two-fold difference in Medicare spending in the country.
Furthermore, higher spending areas are not associated with better quality of care, more patient satisfaction, better access to care, more effective care, or improved outcomes.54 Instead, both health system capacity and local practice styles appear to be key factors in geographic variations in cost. In one study, other researchers found that expenses associated with high-cost beneficiaries were related to their health needs, rather than physician-, practice-, or market-related factors.55 Even so, there was a modest association between less fragmented markets and lower costs, and between a higher concentration of for-profit providers and higher costs.55(p21) In addition, geographic variation was difficult to assess because 20% of Medicare beneficiaries receive care across census divisions, and those patients were often high-cost beneficiaries.55(p20) As policymakers try to improve quality of care in the United States, they will have to untangle difficult questions of why some parts of the country spend more on services than others.
The nation also spends close to one-third of healthcare expenditures on administration.56 As shown in Figures 4-12 and 4-13 , this high level of administrative spending dwarfs that of other countries.57(p934) Extensive use of private insurers, who often have high administrative costs relative to public insurance programs, as well as the use of multiple insurers instead of a single-payer system, result in high administrative costs in the United States.
Equity: An equitable healthcare system provides essential health benefits to all people and includes universal access to care. Equity can be considered on an individual level and on a population level.50(p53) While the ACA should improve individual access to services by reducing the number of uninsured, insurance alone is not sufficient to ensure access to care. The care itself still must be accessible (providers are willing to accept you as a patient), affordable, and available (sufficient providers are available).
Population-level equity refers to reducing healthcare disparities among subgroups. In the United States, racial and ethnic minority groups often receive lower-quality care and fewer routine preventive procedures than white people. African Americans are less likely than whites to receive appropriate cardiac medication, undergo necessary artery bypass surgery, and use dialysis or receive a kidney transplant even when controlling for factors such as age, insurance status, income level, and co-morbidities. Not surprisingly, African Americans also have higher mortality rates than their white counterparts.58(pp2–3) As compared to whites, Hispanics are more likely to be diabetic, experience periodontitis, be HIV positive, and be uninsured, and less likely to be screened for colorectal cancer or receive the flu vaccine as an infant.59
African Americans received worse quality of care on one-third of 16 quality measures reported by the Centers for Medicare and Medicaid Services. For example, African Americans were less likely than whites to receive advice on quitting smoking, more likely to receive a late-stage breast cancer diagnosis, have higher rates of premature death due to coronary heart disease and stroke, experience higher rates of infant mortality, and have more preventable hospitalizations.59,60 Hispanics experienced better quality of care on some measures, but worse on others.60 Both African American and Hispanic patients were more likely than white patients to report poor communication with their providers.
The IOM has called for sweeping changes to the healthcare system to address the numerous ways in which the quality of care could be improved. While the ACA makes significant changes to the healthcare system, the law is focused more on improving access than quality or the delivery system. Many of the law’s quality improvement provisions are pilot programs and demonstration projects that may eventually result in significant changes—or fall to the wayside once they expire. None of the quality improvements tasks the IOM calls for will be simple to achieve and, at times, they seem to have conflicting goals. For example, making the healthcare system patient-centered may not always result in enhanced efficiency. Furthermore, the IOM’s proposed changes would require increased resources at a time when the United States is facing record deficits and unsustainable healthcare spending levels. Improving the quality of the healthcare system is an enormous challenge and one that is likely to be on the nation’s agenda for years to come.
COMPARATIVE HEALTH SYSTEMS
A review of the U.S. healthcare system and a discussion of its flaws often leads one to ask: How do other countries deliver health care and do they do a better job? Because the United States spends more overall and more per person on health care comparatively speaking, perhaps there are lessons to learn from other countries (see Figure 4-14 ). While there are many problems with healthcare delivery in the United States, it is also true that each type of healthcare system has its advantages and drawbacks.
There are three types of healthcare systems often found in other countries: (1) a national health insurance system that is publically financed, but in which care is provided by private practitioners (e.g., Canada); (2) a national health system that is publically financed and where care is provided by government employees or contractors (e.g., Great Britain); and (3) a socialized insurance system that is financed through mandatory contributions by employers and employees and in which care is delivered by private practitioners (e.g., Germany).61(p22) Of course, variations exist within these types of systems in terms of the role of the central government, the presence of private insurance, the way the healthcare system is financed, and how care is administered by providers and accessed by patients. While comparing the systems in the three countries used as examples does not cover all possible permutations of how healthcare systems are designed, it provides an overview of the choices made by policymakers in different countries
A National Health Insurance System: Canada
Canada’s healthcare system is called Medicare. Prior to establishing the Medicare program in 1968, Canada provided insurance in a manner that was similar to the United States, with private plans offering coverage to many, even while millions remained uninsured. Incremental changes were made to the Canadian healthcare system until the Medical Care Act of 1968 established Medicare’s framework. The act included three primary changes to the healthcare system: (1) universal insurance coverage with medically necessary services provided free of charge; (2) a central regulatory authority overseeing hospitals; and (3) governmental power to negotiate reimbursement rates for physicians.
Canada’s healthcare system is largely decentralized, with Canada’s provinces and territories responsible for setting up their own delivery system. As such, Canada’s Medicare system is a collection of single-payer systems governed by the provinces and territories, with the central government taking a more limited role. The provinces and territories set their own policies regarding many healthcare and other social issues, administer their own individual single-payer systems, reimburse hospitals directly or through regional health authorities, and negotiate physician fees schedules with provincial medical associations. Provinces and territories use regional health authorities as their primary payer of healthcare services. While funding methods vary by location, regional health authorities have the ability to tailor funds in a way that best serves the needs of their population. The federal government has responsibility for specific health areas such as prescription drugs, public health, and health research, as well as for providing care to certain populations (e.g., veterans and indigenous peoples).62(p2)
Financing for health benefits varies by benefit type. Hospital services, physician services, and public health services are financed through public taxation. Certain services, including prescription drugs, home care, and institutional care, are financed through a combination of public taxation and private insurance coverage. Other goods and services, such as dental and vision care, over-the-counter drugs, and alternative medicines are only covered through private insurance. In general, private insurance is used to cover goods and services not provided by Medicare; six provinces go so far as to prohibit private insurance companies from competing based on price or access time for Medicare-covered benefits.62(p3)
Tax revenue from the provincial, territorial, and federal governments pay for 70% of total Medicare expenditures, while private insurance reimbursement accounts for 12% of costs, patient out-of-pocket payments cover 15%, and various sources account for the final 3%.63 Healthcare spending is expected to reach C$211 billion in 2013, with the government paying C$148 billion and private insurance and out-of-pocket payments responsible for most of the remaining expenditures. The provinces and territories spend an average of 38% of their budgets on healthcare services, but healthcare spending varies considerably across the country. For example, Alberta spends C$6,787 per person, compared to Quebec’s C$5,531 per person costs.63
In addition to paying for care, regional health authorities also organize the delivery of care. They hire staff at most acute care facilities and contract for some ambulatory care services. General practitioners and specialists work on a fee-for-service arrangement and generally work in either the public program or private practice, but not both.62(p4)While fee-for-service payments account for most of physicians’ income, hospitals rely on global budgets allocated by the regional health authorities.
A National Health System: Great Britain
Great Britain’s healthcare system was designed by Sir William Beveridge as part of a social reconstruction plan after World War II. The National Health Services Act of 1946 created the National Health Service (NHS), a centrally run healthcare system that provides universal insurance coverage to all residents of Great Britain. It was designed based on the principle that the government is responsible for providing equal access to comprehensive health care that is generally free at the point of service.62(p31)
The Health and Social Care Act of 2012 introduced significant changes to the NHS system. In the prior system, health care was delivered through a variety of trusts that covered services such as primary care, mental health care, acute care, and ambulance services. In the new system, Primary Care Trusts were replaced with Clinical Commissioning Groups (CCGs), which are led by clinicians. CCGs are bodies that consist of general practitioners in their service area, and they are responsible for providing urgent and emergency care, elective hospital care, community health services that go beyond general practitioner services, maternity and newborn services, and mental health and learning disability services. The 2012 legislation also created an independent organization called NHS England. The role of NHS England is “to improve health outcomes and deliver high quality care.”64 NHS England provides national leadership, supervises CCGs, allocates resources to CCGs, and commissions primary care, certain specialty care, military care, and offender care.64
The NHS is the largest publically financed national health system in the world. The 2013–2014 budget of £95.6 billion is split between CCG funding (£63.4 billion), operations to run CCGs (£1.3 billion), NHS England to deliver specified services (£25.4 billion), NHS England to meet public health responsibilities (£1.8 billion), local authorities (£.9 billion), and a few other programs.65 Almost half (47%) of funds are spent on acute and emergency care, with general practice, community care, mental health, and prescription drugs each accounting for about 10% of the budget.
The NHS is financed primarily through general tax revenues. It is NHS England’s responsibility to identify necessary healthcare services and Monitor’s (England’s regulatory body for health care) role to set prices for those services.66 While most residents receive their care through the NHS, private insurance is also available. Approximately 10% of residents have private health insurance, which provides the same benefits as the NHS but allows for reduced waiting times and access to higher quality care in some cases.62(p33),67 Those with private insurance tend to have a higher socioeconomic status than individuals covered by the NHS.62(p33)
NHS services are provided by provider organizations that are classified as NHS foundation trusts or NHS trusts. NHS foundation trusts are not directed by the government and are free to make financial decisions based on a framework established by law and regulation. NHS trusts are directed by the government and are financially accountable to the government.64
Most general practice physicians and nurses are private practitioners who work for the NHS as independent contractors, not salaried employees, while the NHS owns the hospitals and the hospital staff are salaried employees. Patients select a general practitioner (GP) in their service area and this provider is the gateway to NHS services. Almost everyone (99%) has a registered GP and 90% of all patient contact is with this provider.62(p33) Services are provided free of charge, except for specific services designated by law.
The Health and Social Care Act also renewed focus on public health needs. Public Health England was created in 2013 as an autonomous executive agency of the Department of Health. Its role is to protect the public’s health, reduce health disparities, promote health knowledge and information, and ensure that high-quality healthcare services are delivered to the public.62 In addition, local Health and Well-being Boards were created to improve the public’s health and reduce disparities through local government action.
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