Healthcare/ Leadership
100honestyworkChapter 14
Analysis of the U.S. Healthcare System
LEARNING OBJECTIVES
The student will be able to:
Discuss the advantages and disadvantages of e-prescribing.
Describe the universal healthcare systems of Massachusetts and San Francisco, California.
Describe the major components of the healthcare delivery systems of Japan, France, and Switzerland.
Discuss three current healthcare trends.
Assess the pros and cons of a pay-for-performance (P4P) healthcare system.
Evaluate the differences between the types of universal health coverage programs.
DID YOU KNOW THAT?
More than 7,000 medication-related deaths occur each year as a result of incompatible drug interactions and drug allergies. These deaths are caused by illegible handwritten prescriptions and because the healthcare provider is unaware of patient allergies.
In April 2006, the state of Massachusetts passed legislation to implement a type of universal healthcare coverage for its residents.
Robotic hands used in surgery are so sensitive that they can easily peel a grape or thread a needle.
Both Walgreens and CVS have drugstore clinics that are run by nurse practitioners or physician assistants who provide routine care.
The Department of Labor’s Bureau of Labor Statistics indicates that the fastest growing jobs in the next decade will be in the healthcare industry.
Back pain is the most common reason why healthcare consumers use alternative medicine approaches.
INTRODUCTION
The U.S. healthcare system has long been recognized for providing state-of-the-art health care. It has also been recognized as the most expensive healthcare system in the world and the price tag is expected to increase. Despite offering two large public programs—Medicare and Medicaid for the elderly, indigent, and disabled—current statistics indicate that over 48 million individuals are uninsured.
This chapter will provide an international comparison between the U.S. healthcare system and the healthcare systems of other countries and discuss whether universal healthcare coverage should be implemented in the United States. This chapter will also discuss U.S. healthcare trends that may positively impact the healthcare system, including the increased use of technology in prescribing medicine and providing health care, complementary and alternative medicine use, new nursing home models, accountable care organizations, and a discussion of the universal healthcare coverage programs in Massachusetts and San Francisco, California. The Affordable Care Act (ACA) will also be discussed because of its major impact on the U.S. healthcare system.
HIGHLIGHTS OF THE U.S. HEALTHCARE SYSTEM
The U.S. healthcare system is a complicated system that is composed of both public and private resources ( Figure 14-1 ). Health care is available to those individuals who have health insurance or are entitled to health care through a public program or who can afford to pay out of pocket for their care. Think of the healthcare system as concentric circles that surround the most important circle—the healthcare consumers and healthcare providers. Immediately surrounding this relationship is the circle that contains healthcare insurance companies and government programs such as Medicaid and Medicare, state and local public health departments, federal government healthcare organizations such as the Centers for Disease Control and Prevention (CDC), healthcare facilities, allied health professionals, pharmaceutical companies, and laboratories that all provide services to consumers to ensure that they receive quality health care and support providers to ensure that they are able to provide quality health care. The next circle consists of peripheral stakeholders that do not immediately impact that main relationship but are still important to the industry: professional associations such as the American Medical Association, accreditation associations such as The Joint Commission, research organizations, and medical and training facilities.
The one commonality with the world’s healthcare systems is that they all have consumers or users of their systems. Systems were developed to provide a service to their citizens. The U.S. healthcare system, unlike other systems in the world, does not provide healthcare access to all of its citizens. Healthcare expenditures comprise approximately 17.6% of the gross domestic product (GDP). Healthcare costs are very expensive and most citizens would be unable to afford it if they had to pay for it themselves. Individuals rely on health insurance to pay a large portion of their healthcare costs. Health insurance is predominantly offered by employers. According to a 2011 CDC survey, there were over 48 million people uninsured in the United States, with approximately 29 million who were underinsured, which means their health insurance did not adequately cover their medical expenses. (It will be interesting to assess the impact of the Affordable Care Act on this statistic because a major focus is individual insurance coverage nationwide. The ACA projects there will be a decrease of nearly 70% in these statistics when the ACA is fully implemented) (Affordable Health Care for America, 2010).
Figure 14-1 Healthcare Industry Stakeholders
AFFORDABLE CARE ACT IMPACT
The Patient Protection and Affordable Care Act of 2010 or Affordable Care Act and its amendment have focused on primary care as the foundation for the U.S. healthcare system (Goodson, 2010). The legislation has focused on 10 areas to improve the U.S. healthcare system: quality, affordable and efficient healthcare, public health and primary prevention of disease, healthcare workforce increases, community health, and increasing revenue provisions to pay for the reform. However, once the bill was signed, several states filed lawsuits. Several of these lawsuits argue that the Act violates the Constitution because of the mandate of individual healthcare insurance coverage as well as infringes on state rights with the expansion of Medicaid (Arts, 2010). The 2012 U.S. Supreme Court decision that supported the constitutionality of the individual mandates should decrease the number of lawsuits. In October 2013, there were major problems with the operations of the federal government website (www.healthcare.gov) that housed the Health Insurance marketplace. On October 1, the first day of the individual health insurance coverage mandate, consumers were unable to enroll in health insurance plans nationally, although over 2 million have enrolled using the federal website as of January 1, 2014 and hope to enroll 7 million by the deadline of March 31, 2014. State run health insurance marketplaces have also experienced the same types of technological issues creating frustration as well. This major computer issue has created a firestorm of criticism. Despite these lawsuits and operational problems, this legislation has clearly provided opportunities to increase consumer empowerment in the healthcare system by providing temporary insurance to those individuals with pre-existing conditions until they can purchase their own insurance, eliminating lifetime and annual caps on health insurance payouts, improving the healthcare workforce, and providing databases so consumers can check the quality of their healthcare. The Affordable Care Act enables healthcare consumers to select a health insurance plan based on the amount of cost sharing the consumer wants to pay. There are three types of plans: gold, silver and bronze. Gold plans have the lowest cost sharing but is the most expensive. The silver plan has moderate cost sharing and is not as expensive as the gold plan and the bronze plan has high cost sharing but the premiums are the lowest. This type of structure enables the consumer to select a plan that fits their budget. The ACA’s focus is to increase the role of public health and primary care in the U.S. healthcare system while increasing accessibility to the system by providing affordable healthcare opportunities. The next stage in the ACA assessment is to determine how effective the new health insurance plans are, which became effective January 1, 2014.
GOVERNMENT’S ROLE
The government plays an important role in the quality of the U.S. healthcare system. The federal government provides funding for state and local government programs and sets policy for many aspects of the U.S. healthcare system. The federal government is also responsible for the implementation of Medicare, the entitlement program for the elderly. Federal healthcare regulations are implemented and enforced at the state and local levels. Funding is primarily distributed from the federal government to the state government, which consequently allocates funding to its local health departments. Local health departments provide the majority of services for their constituents and are collaborating with local organizations such as schools and physicians to increase their ability to provide education and prevention services.
PUBLIC HEALTH
Public health is challenged by its very success because consumers now take public health measures for granted. There are several successful vaccines that have targeted all childhood diseases, tobacco use has decreased significantly, accident prevention has increased, there are safer workplaces because of the Occupational Safety and Health Administration (OSHA), the fluoridation of water has been established, and there has been a decrease in mortality from heart attacks (Novick & Morrow, 2008). The National Association of County and City Health Officials (NACCHO) and the Association of State and Territorial Health Officials (ASTHO) are important support organizations for both state and local governments by providing policy expertise, technical advice, and lobbying at the federal level for appropriate funding and regulations. When some major event occurs like a natural or manmade disaster, people immediately think that public health will automatically control these problems. The public may not realize how much effort, dedication, and research takes place to protect the public. President Obama has recognized the importance of public health with the passage of the Affordable Care Act, which focuses on increasing access to and quality of the U.S. healthcare system. The ACA also focuses on primary prevention activities, which are the foundation of public health.
As a healthcare consumer, it is important to recognize the role that public health plays in our health care. If you are sick, you go to your physician for medical advice, which may mean providing you with a prescription. However, oftentimes you may not go see your physician because you do not have health insurance or you do not feel that sick or you would like to change one of your lifestyle behaviors. Public health surrounds consumers with educational opportunities to change a health condition or behavior. You can visit the Centers for Disease Control and Prevention website (www.cdc.gov) for information about different diseases and health conditions. You can also visit your local health department.
HOSPITAL AND OUTPATIENT SERVICES
Many hospitals have experienced financial problems. As a result of the increased competition of outpatient services (which are often more cost-effective, efficient, and consumer friendly) and reduced reimbursement from Medicare and Medicaid, many hospitals have developed strategies to increase their financial stability. Due to pressure to develop cost containment measures, hospitals are forming huge hospital systems and building large physician workforces. In order to compete with the Affordable Care Act’s mandated state healthcare exchanges where consumers can purchase health insurance, health insurance companies are developing relationships with hospitals and creating joint marketing plans and sharing patient data (Mathews, 2011).
Over the years, outpatient services have become the major competitors of hospitals. Advanced technology has enabled more ambulatory surgeries and testing, which has resulted in the development of many specialty centers for radiology and imaging, chemotherapy treatment, and kidney dialysis. These services were often performed in a hospital. What is even more interesting is that physicians or physician groups own some of the centers. They are receiving revenue that used to be hospital revenue. Hospitals have recognized that fact and have embraced outpatient services as part of their patient care. Hospitals have to continue to focus on revenue generation by operating more outpatient service opportunities. They own 25% of urgent care centers in the United States; 21% have ownership interest in ambulatory surgery centers and 3% of hospitals have sole ownership (ASCA, 2013).
HEALTHCARE PERSONNEL
The healthcare industry is the fastest growing industry in the U.S. economy, employing a workforce of 18 million healthcare workers. Considering the aging of the U.S. population and the impact of the Affordable Care Act, it is expected that the healthcare industry will continue to experience strong job growth (Centers for Disease Control and Prevention, 2013). When we think of healthcare providers, we automatically think of physicians and nurses. However, the healthcare industry is comprised of many different health services professionals. The healthcare industry includes dentists, optometrists, psychologists, chiropractors, podiatrists, non-physician practitioners (NPPs), administrators, and allied health professionals. A new type of healthcare professional is the care coordinator, the fastest growing occupation, integrates nursing, social work and disability counseling for the elderly with chronic conditions who need additional assistance. It is important to identify allied health professionals because they provide a range of essential healthcare services that complement the services provided by physicians and nurses. This category of health professionals is an integral component of providing quality health.
Health care can occur in varied settings. Physicians have traditionally operated in their own practices but they also work in hospitals, mental health facilities, managed care organizations, or community health centers. They may also hold government positions or teach at a university. They could be employed by an insurance company. Health professionals, in general, may work at many different organizations, both for profit and nonprofit. Although the healthcare industry is one of the largest employers in the United States, there continues to be shortages of physicians in geographic areas of the country. Rural areas continue to suffer physician shortages, which limits consumer access to health care. There have been different incentive programs to encourage physicians to relocate to rural areas, but shortages still exist. In most states, only physicians, dentists, and a few other practitioners may serve patients directly without the authorization of another licensed independent health professional. Those categories authorized include chiropractic, optometry, psychotherapy, and podiatry. Some states authorize midwifery and physical therapy (Jonas, 2003). There also continues to be a shortage of registered nurses nationwide. The American Association of Colleges of Nursing (AACN) is publicizing this issue with policy makers (AACN, 2013).
HEALTHCARE EXPENDITURES
The percentage of the U.S. gross domestic product (GDP) devoted to healthcare expenditures has increased over the past several decades. In 2010, the United States spent $2.6 trillion on healthcare spending or 17.6% of the gross domestic product, which is the highest in the world. In 2011, U.S. Census data indicates there were over 48 million uninsured U.S. citizens, which is a decrease from 50 million in 2010. The Centers for Medicare and Medicaid Services (CMS) predicts annual healthcare costs will be $4.64 trillion by 2020, which represents nearly 20% of the U.S. gross domestic product (CMS, 2013). The increase in healthcare spending can be attributed to three causes: (1) When prices increase in an economy overall, the cost of medical care will increase and, even when prices are adjusted for inflation, medical prices have increased; (2) as life expectancy increases in the United States, more individuals will require more medical care for chronic diseases, which means there will be more healthcare expenses; and (3) as healthcare technology and research provide for more sophisticated and more expensive procedures, there will be an increase in healthcare expenses (Pointer, Williams, Isaacs, & Knickman, 2007).
As healthcare expenditures continue to increase, the major focus of the healthcare industry is cost control, in both the public and private sectors. For years, healthcare costs were unchecked. The concept of retrospective reimbursement methods (when a provider submitted a bill for healthcare services to a health insurance company and was automatically reimbursed) gave healthcare insurers no incentive to control costs in health care. This type of reimbursement method contributed to expensive health care for both the healthcare insurance companies and the individual who was paying out of pocket for services. As a result, the establishment of a prospective reimbursement system for Medicare (reimbursement is based on care criteria for certain conditions, regardless of providers’ costs) became an incentive for providers to manage how they were providing services. The Center for Medicare and Medicaid Innovation is providing grants to healthcare organizations to explore different payment models based on performance.
The managed care model for healthcare delivery was developed for the primary purpose of containing healthcare costs. By administering both the healthcare services and the reimbursement of these services, and therefore eliminating a third-party health insurer, the industry felt that this model would be very cost-effective. The consumer’s (or patient’s) and the physician’s concerns were the same—worry about providing quality care while focusing predominantly on cost. The consumer was also worried about loss of freedom of choice of primary care provider. The physician was worried about loss of income.
As managed care evolved, managed care organizations (MCOs) were developed, which allowed more choice for both the consumer and the physician. Eventually, there were models such as preferred provider organizations (PPOs) and point-of-service (POS) plans that allowed consumers to more freely choose their provider; however, there was a financial disincentive to use a provider outside the network of the MCO. Providers were also able to see non-MCO patients, which increased their income, but they also received a financial deterrent because any MCO patient was given health care at a discounted rate.
INFORMATION TECHNOLOGY
The healthcare industry has lagged behind utilizing information technology (IT) as a form of communicating important data across healthcare systems nationally. Despite that fact, there have been specific applications developed for HIT, such as e-prescribing, telemedicine, e-health, and specific applied technology such as the PatientPoint, MelaFind optical scanner, the Phreesia Pad, Sapien heart valve, robotic checkups, Electronic Aspirin, Accuson P10, and the Piccolo xpress, which were discussed elsewhere in this text. Healthcare organizations have recognized the importance of IT and have hired chief information officers (CIOs) and chief technology officers (CTOs) to manage their data. However, healthcare consumers need to embrace an electronic patient record. This will enable patients to be treated effectively and efficiently nationally. The patient health record can be integrated into the electronic health records that are being utilized nationwide. Having the ability to access a patient’s health information could assist in reducing medical errors. As a consumer, utilizing a tool like HealthVault could provide an opportunity to consolidate all medical information electronically, so if there are any medical problems, the information will be readily available.
HEALTHCARE LAW
To be an effective healthcare manager, it is important to understand basic legal principles that influence the work environment including the legal relationship between the organization and the consumer—the healthcare provider and the patient. As both a healthcare manager and healthcare consumer, it is imperative that you are familiar with the different federal and state laws that impact the healthcare organization. It is also important that you understand the differences between civil and criminal law and the penalties that may be imposed for breaking those laws. Both federal and state laws have been enacted and policy has been implemented to protect both the healthcare provider and the healthcare consumer. New laws have been passed and older laws have been amended to reflect needed changes regarding health care to continue to protect its participants from both a patient and an employee/employer perspective.
U.S. citizens continue to experience some of the poorest health outcomes in the industrialized world. It is the responsibility of the government and policymakers, clinicians, and researchers to become involved in the progress of developing a systematic healthcare transformation in order to improve the health outcomes in this country. The goal of the Healthy People reports is to improve the quality of life and to eliminate health disparities among different segments of the population. These goals must be supported by lawmakers to ensure that at least a minimum standard is established and that health justice is achieved (Department of Health and Human Services [HHS], 2000). The Affordable Care Act and its mandates have attempted to rectify these problems.
HEALTHCARE ETHICS
Legal standards are the minimal standard of action established for individuals in a society. Ethical standards are considered one level above a legal action because individuals make a choice based on what is the “right thing to do,” not what is required by law. There are many interpretations of the concept of ethics. Ethics has been interpreted as the moral foundation for standards of conduct (Taylor, 1975). The concept of ethical standards applies to actions that are hoped for and expected by individuals. Actions may be considered legal but not ethical. There are many definitions of ethics but, essentially, ethics is concerned with what are right and wrong choices as perceived by society and its individuals.
There are also several ethical issues involving the healthcare industry and its stakeholders. There are two components of ethics in health care: medical ethics, which focus on the treatment of the patient, and bioethics, which focus on technology and how it is utilized in health care. The most important stakeholder in health care is the patient. The most important relationship with this stakeholder is with his or her healthcare provider. Their relationship is impacted by the other stakeholders in the industry, including the government, who regulates healthcare provider activities; the insurance companies, who interact with both provider and patient; and healthcare facilities, such as hospitals or managed care facilities, where the physician has a relationship. All of these stakeholders can influence how a healthcare provider interacts with the patient because they have an interest in the outcome. For that reason, many organizations that represent these stakeholders have developed codes of ethics so individuals are provided guidance for ethical behavior. Codes of ethics for the physicians and other healthcare providers, nurses, pharmaceutical companies, and medical equipment companies were discussed previously and emphasize how these stakeholders should interact with both the healthcare providers and patients. These codes of conduct also apply to the relationship between employees in a healthcare facility. The issue of workplace bullying has been a continuous problem for many years. The Joint Commission issued a statement and guidelines for workplace behavior in the healthcare industry. The Joint Commission indicated that this type of behavior can be destructive, resulting in medical errors.
MENTAL HEALTH
Mental health issues impact millions of U.S. citizens. Mental health disabilities limit the life expectancy of individuals by 25 years. Treatment of mental health disorders has been traditionally underfunded because of the attitude of the traditional healthcare system, confusion by health insurance companies, and fear of discrimination by individuals who are mentally ill. In 1999, Surgeon General David Satcher’s report on mental health brought awareness to the issues with the U.S. mental healthcare system. The Mental Health Parity Act of 1996 was an attempt to establish a fair system of treatment between mental health disorders and traditional healthcare conditions by mandating annual and lifetime limits to be equal between mental health care and traditional health care. President George W. Bush’s Freedom Commission on Mental Health focused on an analysis of the mental health system and recommendations to improve mental health care.
The Mental Health Parity and Addiction Equity Act (2008) further supported mental health care by requiring insurance plans to offer similar benefits to traditional medical benefits and cost sharing to be similar to other medical benefits. However, mental health experts and legislators felt the Act was overall weak and recently passed a final rule that would strengthen the Act, increasing parity of mental health insurance coverage with traditional health insurance coverage. The Obama administration has recognized the importance of funding mental health initiatives, including teacher training programs for mental health awareness (Mohney, 2013).
TRENDS IN HEALTH CARE
Complementary and alternative medicine (CAM) is a group of diverse medical care practices that are not considered part of traditional medicine. “Complementary” generally refers to using a nonmainstream approach together with conventional medicine. “Alternative” refers to using a nonmainstream approach in place of conventional medicine. Integrative medicine means a combination of alternative and complementary medicine with a mainstream approach.
Examples of CAM include acupuncture, chiropractic manipulation, diet therapies, meditation, natural products (e.g., flaxseed and fish oil), yoga, and massage. In 2012, approximately 40% of adults used CAM. CAM use is more predominant in females and those individuals with higher education and income. The National Center for Health’s recent statistics indicate that back pain was the most common reason people used CAM (National Center for Complementary and Alternative Medicine, 2013). U.S. consumers spend an average of $34 billion on CAM. It is anticipated that more CAM therapies, particularly alternative medicine therapies, will be used by those individuals that are uninsured and underinsured.
Nursing Home Trends
In 2001, the Robert Wood Johnson Foundation funded a pilot project developed by Dr. Bill Thomas, the Green House Project, which is a unique type of nursing home that focuses on creating a residence that not only provides services but is also a home to the residents, not an institution where they receive care. It alters the size of the facility, the physical environment, and delivery of services (Fine, 2009).
The home is managed by a team of workers who share the care of the residents, including the cooking and housekeeping. The daily staff members are certified nursing assistants (CNAs). All mandated professional personnel, such as physicians, nurses, social workers, and dieticians, form visiting clinical support teams that assess the elders and supervise their care (Kane, Lum, Cutler, Degenholtz, & Yu, 2007).
The residents can eat their meals when they choose. The word “patient” is not used; all residents are called “elders.” The Green House is designed for 6–10 elders. Each resident has a private room and private bathroom. The elder rooms have lots of sunlight and are located near the kitchen and dining areas. There are patios and gardens for elders and staff to enjoy. Although these new types of nursing homes look like a residential home, they adhere to all long-term housing requirements. They look like other homes in their designated neighborhood (Fine, 2009).
Residents can also have their own pets, which are not allowed in traditional nursing homes. According to a recent study performed by the University of Minnesota, the residents of the Green House are able to perform their activities of daily living longer and are less depressed than residents of traditional nursing homes and are able to be self-sufficient longer than residents from traditional nursing homes. The staff also enjoy working at the Green House, resulting in less staff turnover (Kane et al., 2007).
The first Green House was constructed in Tupelo, Mississippi. There are now 18 homes nationwide. Dr. Thomas has partnered with the Robert Wood Johnson Foundation (RWJF) and NCB Capital Impact, which is a not-for-profit organization that provides financial assistance to underserved communities. The NCB Capital Impact has a loan program that provides financial assistance of up to $125,000 to support engineering, architectural, and other expenses for a selected Green House site. The borrower must contribute 25% of the loan amount (NCB Capital Impact, 2013).
Since 2002, the Foundation has awarded $12 million, primarily to NCB Capital Impact, to develop, test, and evaluate the Green House model. In 2011, the Foundation decided to expand its support, with the goal of helping the Green House model achieve greater reach and impact. With NCB Capital Impact, RWJF announced a 10-year, $10 million low-interest credit line to finance the building of Green House homes. Specifically, this investment reduces the cost of financing Green House projects to serve low-income elders. RWJF support is helping to spread the Green House model across the United States. Today, hundreds of Green House homes are open or under development in many states (Robert Wood Johnson Foundation, 2013).
Accountable Care Organizations: Value Based Purchasing
The Affordable Care Act of 2010 established the Hospital Value-Based Purchasing Program. It is a Centers for Medicare & Medicaid Services (CMS) initiative that rewards acute-care hospitals with incentive payments for the quality of care they provide to people with Medicare, not just the quantity of procedures performed. Hospitals are rewarded based on how closely they follow best clinical practices and how well hospitals enhance patients’ experiences of care. When hospitals follow proven best practices, patients receive higher quality care and see better outcomes. Hospital value-based purchasing is just one initiative CMS is undertaking to improve the quality of care Medicare beneficiaries receive.
Innovative Finance Models
According to the CMS website, Accountable Care Organizations (ACOs) are groups of providers and hospitals who volunteer to give coordinated care to Medicare patients. The goal of ACOs is to ensure that patients, especially with chronic conditions, receive timely care while avoiding duplication of services and preventing medical errors. Medicare has developed three major programs for providers to become ACOs:
Medicare Shared Savings Program—a program that helps Medicare fee-for-service program providers become an ACO.
Advance Payment ACO Model—a supplementary incentive program for smaller practices: physician-based and rural providers in the Shared Savings Program. They receive monthly payments to use for coordinated care. There are currently 35 who participate in the program.
Pioneer ACO Model—a program designed for early adopters of coordinated care. Any monetary savings are shared with Medicare (CMS, 2013).
There are 32 ACOs enrolled in the Pioneer ACO model. According to recent results, only 13 of the ACOs improved patient quality of healthcare services, patient satisfaction, and saved money. Two of the ACOs owe Medicare $4 million because they spent more on their patients than the traditional Medicare fee-for-service rates. (Bleach, 2013). As of July 2013, seven ACOs have opted to leave the Pioneer Model and enter the Medicare Shared Savings Program and two will be leaving the Medicare ACO program entirely. The 13 that saved money while improving quality of care saved $87.6 million in 2012, saving about $33 million for Medicare (Zigmond, 2013).
Pay-for-performance (P4P) or value-based purchasing (VBP) are terms that describe healthcare payment systems that reward healthcare providers, including hospitals, physicians, and other providers for their efficiency, which is defined as providing higher quality care for less cost. From a healthcare consumer’s perspective, these stakeholders should hold healthcare providers accountable for both the cost and high quality of their care. Since most health care in the United States has been historically provided by employers, in VBP, employers should select healthcare plans based on demonstrated performance of quality and cost-effective health care (Agency for Healthcare Research and Quality [AHRQ], 2013). For the past decade, the Centers for Medicare & Medicaid Services (CMS) has been collaborating with the National Quality Forum, The Joint Commission, the National Committee for Quality Assurance, AHRQ, and the American Medical Association to implement initiatives to assess P4P systems nationwide.
For example, California’s Integrated Healthcare Association’s (IHA) P4P program, started in 2003, has operated as the largest nongovernmental program nationally. The program targets 225 medical groups representing 35,000 physicians that contracted with the 8 largest health maintenance organizations (HMOs) and P4Ps in the state, which have 10 million enrollees. The IHA scored physician care based on the healthcare effectiveness data, information measures, and paid performance-based payments. These report cards are available to patients so they can review the performance of the health plans. The results are posted on the California Office of the Patient Advocate website (State of California, 2013). The concept of P4P is a valid concept for health care. Its goals of quality and access are similar to the goals of the Affordable Care Act. There are nearly 200 P4Ps worldwide that indicate improvements in clinical quality performances, although fewer improvements in patient satisfaction. These programs also encourage physicians to adopt clinical decision support systems (Integrated Healthcare Association, 2013).
Electronic Prescribing
E-prescribing developed as a result of the Medicare Prescription Drug, Improvement and Modernization Act. Part D, which authorized a drug prescription program for enrollees, also supported a voluntary electronic prescription program for providers. It also called for the adoption of technical standards to develop a system that would support e-prescribing. This electronic system would enable physicians to check the ingredients of the drugs, which would enable an increased use of generic drugs because they could automatically compare the drug ingredients to brand name prescription drugs (Friedman, Schueth, & Bell, 2009). E-prescribing is not only more efficient, it enhances patient safety. More than 7,000 medication-related deaths occur each year as a result of incompatible drug interactions and drug allergies. These deaths are because of illegible handwritten prescriptions and because the healthcare provider is unaware of patient allergies. E-prescriptions are immediately notified about patient-specific drug allergies and potential drug interactions (Brunetti & Jay, 2009). According to the 2012 National Progress Report on E-Prescribing and Safe-RX Rankings, 93% of internists, 85% of cardiovascular specialists, and 84% of family practice providers have adopted e-prescribing. Nearly 70% of physicians’ offices prescribe and nearly 90% of prescribers also use an electronic health record. Over 90% of pharmacies can accept electronic prescriptions (Surescripts, 2012).
Section 132 of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) authorized incentives to encourage physicians to e-prescribe. In January 2009, Medicare and some private healthcare plans began paying a bonus to physicians who e-prescribe to their Medicare patients. Medicare will also penalize physicians who do not e-prescribe by 2012 by reducing their reimbursement rates by 1%, 1.5% for 2013, and 2% for 2014 and all subsequent years. (Electronic Prescribing Incentive Program, 2013). IT companies are providing free software to physicians to encourage them to electronically prescribe.
Telemedicine
Telemedicine refers to the use of information technology to enable healthcare providers to communicate with rural care providers regarding patient care or to communicate directly with patients regarding treatment. The basic form of telemedicine is a telephone consultation. Telemedicine is most frequently used in pathology and radiology because images can be transmitted to a distant location where a specialist will read the results. Telemedicine is becoming more common because it increases healthcare access to remote locations such as rural areas. It also is a cost-effective mode of treatment. It is also possible that employers and health plans recognize the potential to improve access to medical care while reducing medical costs (Gingrich, Boxer, & Brooks, 2008). For example, eEmergency, established in 2009, provides immediate electronic access of emergency certified physicians and nurses to rural providers to help them with diagnosis of patients with critical conditions. Since its inception in 2009, eEmergency has served more than 15,000 patients at 70 locations. Rural clinicians and administrators agreed that eEmergency services have demonstrated significant impact on the quality of clinical services provided in rural areas (Telemedicine case studies, 2013). This type of consumer-centric approach may become more popular.
Radio Frequency Identification
Radio frequency identification (RFID) chips transmit data to receivers. Each of these chips is uniquely identified by a signal indicating where it is located. RFID has been used in the business industry for inventory management by placing a chip on each of the pieces of inventory. Walmart was one of the first retailers to use RFID technology to manage their massive inventory. Recently, RFID technology is being used in many aspects of the operations of the healthcare industry. RFID can be used for the following:
Tracking pharmaceuticals as they are shipped from the manufacturer to the customer
Tracking pharmaceutical inventory in a healthcare facility
Tracking wait time in emergency rooms
Tracking the use of what is being used in surgeries
Tracking costly medical equipment to ensure easy access
Identifying providers in hospitals to ensure efficiency in care
Identifying laboratory specimens to reduce medical errors
Tracking patients, including infants, while they are hospitalized
Tracking hazardous materials that pose a public health threat
Tracking hand washing use to ensure employee compliance (RFID Solutions, 2013)
Robotic Surgery
Robots were first introduced as a surgical tool in 1987. Robotic surgery is a type of minimally invasive surgery (MIS) that it is less invasive than traditional surgery—there are smaller incisions, which reduce the risk of infection, shorten hospital stays, and reduce recuperation times. Surgeons manipulate robotic arms to perform surgeries normally performed by human hands. Surgeons have to be trained in robotic surgery and use a machine that will reduce the possibility of errors caused by tremors in the surgeons’ hands.
As robotic surgery became more popular, the National Aeronautic and Space Administration (NASA) developed the concept of telesurgery or medical robotics and computer assisted surgery (MRCAS), which combines virtual reality, robots, and medicine. The U.S. Army also became involved in robotic surgery because they were interested in bringing surgery to the soldiers who were fighting and needed surgery immediately. They hoped robotic surgery would reduce war mortality rates. It is important to note that there are also other tools that can be used for MIS. Studies have indicated that some procedures such as an appendectomy show very little difference if performed by the traditional method or the robotic method. However, robotic surgeries performed on the prostate have shown significant positive outcomes (Guidarelli, 2006; Loisance, 2007).
The robotic system that has dominated the current market is the da Vinci Surgical System, which was developed by Intuitive Surgical of Sunnyvale, California. It is used in areas of cardiac, urologic, gynecologic, and general surgery. This tool was used for 1,500 cases in the year 2000, but use increased to 20,000 cases in 2004 and 48,000 procedures in 2006. Recent data indicates this equipment was used in 350,000 cases (Langreth, 2013). The initial investment for a da Vinci system is $1.5 million, with an annual upkeep of $100,000 (Intuitive Surgical, Inc., 2013). Despite the initial cost, experts feel that the actual procedure is cost-effective because recuperation time is far less for the patients. The continued issue with telesurgery is patient injuries as a result of the use of robotic equipment. There has been continued issues with the DaVinci tool. The FDA, who regulates medical devices, in 2013, received 3,700 reports of injuries, deaths, and malfunctions from robotic surgery. Industry experts believe these adverse events are being underreported (Langreth, 2013). As with any technological advances, the costs should decrease and the tool will become more advanced and more efficient, but the safety issues must be addressed.
Drugstore Clinics
Rite Aid, Walgreen’s, and CVS, three national chain pharmacies, have established drugstore clinics. CVS, the leader in this innovative type of health care, now has 640 Minute Clinics nationwide. They have decided to expand their treatment options to include conditions handled normally by a physician. Their goal is not to replace primary care providers but to increase access to health care. Walgreens, which has nearly 400 Take Care Clinics nationwide, will follow the CVS policy. Many of the patients who use drugstore clinics do not have a primary care provider (Modern Healthcare, 2013). According to the Convenient Care Association (CCA), since the walk-in clinics opened in 2000, an estimated 5 million people have been treated. According to the CCA, there are 1,400 clinics in 35 states. Like urgent care clinics, they are open late, on weekends, and you do not need an appointment. This type of access may encourage more individuals to seek health care (Witsil, 2013).
Care Managers
Care managers, or care coordinators, are individuals who combine nursing, social services and disability assistance to individuals primarily who are eligible for both Medicare and Medicaid or dual eligibles, suffer from chronic conditions and often cannot handle managing their own chronic conditions. The goal of a care coordinator is to avoid the patient’s placement into a nursing home. Dual eligible patients utilize 35% of Medicare and Medicaid spending so this type of assistance with patient life issues may reduce government spending. According to the CMS, eight states have signed agreements with the CMS to develop care coordination plans (Dickson, 2013).
Care coordinators are the fastest growing occupation in the healthcare industry and are primarily registered nurses.
The Villages Health System
The Villages is one of the largest over-55 golf cart communities in the United States. They have developed a partnership with the University of South Florida to create a patient-centered, community-based and primary care driven healthcare system. A primary care network is being developed in which all residents have access to a medical home or care center that will be located within 10 minutes by golf cart. There will be 6–10 facilities with 5–9 physicians in each care center that will serve as a gatekeeper for the patient’s care. Although many patients are Medicare eligible, the physicians will be salaried and not focused on the quantity of patients they receive for their Medicare reimbursement but on the development of a relationship with their patients. Each facility will serve a designated geographic area of patients. They will collaborate with their patients on their care by educating them on healthy behaviors. If they need a specialist, they will help the patient with the referral. They will have extended hours and emergency operations. They will implement the electronic health record system to enable patient data sharing among the centers. They will also have health coaches on staff that will work with patients on developing a healthy lifestyle. At this point, there is one care center in operation. All of these centers will be accredited by the NCQA (The Villages Health, 2013).
INTERNATIONAL HEALTHCARE SYSTEMS
For years, there has been a movement toward healthcare reform in the United States because many feel that because the United States is so powerful and wealthy, compared to the rest of the world, we should not have nearly 50 million uninsured citizens. However, universal healthcare coverage may not be the answer. It, too, has problems.
There is continued controversy over the expense of the U.S. healthcare system. If we spend so much of our gross domestic product on health care, why are there geographic disparities on who receives it? This may result in lower health indicators in the United States, such as life expectancy and infant mortality rates, compared to the rest of the world. Although the United States can provide state-of-the-art health care, we are reminded of the Institute of Medicine report that estimates 44,000–90,000 annual deaths are a result of medical errors (Kohn, Corrigan, & Donaldson, 1999). As with any large system, there are system errors that were just outlined. The United States is not the only country with a healthcare system that has problems.
UNIVERSAL HEALTHCARE CONCEPTS
Countries with national healthcare programs provide universal access to health care to all citizens. They have a single-payer system, which means the government pays for the healthcare services. There are three models for structuring a universal or national healthcare system: national health insurance, national health system, and socialized health insurance system. National health insurance, as in Canada, is funded by the government through general taxes, although the delivery of care is by private providers. In a national health system, as in Great Britain, taxes support the system but the government also manages the infrastructure for healthcare delivery. In a socialized health insurance system, as in Germany, the government mandates financial contributions by both the employer and employee with private providers delivering health care. Sickness funds, which are not-for-profit insurance companies, collect the contributions and pay the healthcare providers (Shi & Singh, 2008). The U.S. healthcare system is employer–employee based and government funded. The U.S. system provides 100% coverage of people older than 65 years of age with the Medicare program, and 82% coverage for people younger than 65 years of age through employer-based insurance, Medicaid, Indian Health Services, Veterans’ Administration (TRICARE), and the federal government employee program. Infant mortality rates and life expectancy rates are common healthcare indicator comparisons among countries. Based on Organization for Economic Cooperation and Development data, Japan, Switzerland, and Sweden, which had the best infant mortality and life expectancy rates, were selected for discussion. These analyses will demonstrate that although these countries offer a type of universal healthcare coverage, they also have problems.
Japan
Japan’s social security system is divided into four components: social insurance, social welfare, public assistance, and public health. The core social insurance is mandatory and provides a designated monetary amount or benefits to citizens for disease, injury, childbirth, death, old age, disability, and loss of job. A universal healthcare insurance system provides appropriate healthcare anywhere at any time. Citizens have to be covered by any of the following medical insurances: (1) employees health insurance, (2) national health insurance for self-employed or unemployed for those 75 years or older. Health care for the elderly was established in 2008 but there have been complaints about the high premiums and care so it may be abolished.
As part of their health insurance system, the insured pay a premium to the health insurance companies, and in case of a care visit pay a copayment to the healthcare institutions. Healthcare institutions receive reimbursement from health insurance companies. Healthcare expenditures are paid on a fee-for-service basis.
Employees and their dependents under age 75 years are required to enroll in the coverage offered either by their employers (if employed by large companies) or the Japan Health Insurance Association (if employed by small- or medium-sized companies). All enrollees have to pay coinsurance of 30% for services and goods covered, except for children (20%) and people age 70 years and over with low incomes (10%). In 2010, out-of-pocket payments for cost sharing accounted for 16% of total health expenditures (Japanese Nursing Association, 2013).
The remaining population under age 75 (unemployed, self-employed, retired, and others) is covered by municipal-run “Citizens Health Insurance” plans. Those age 75 years and over are covered by health insurance plans operated by insurers established in each prefecture (H-Old). There are penalties if citizens do not enroll. Most citizens purchase supplementary private health insurance. The devastating earthquake, tsunami, and nuclear emergency that occurred in the last several years has created a health crisis while also destroying a significant part of the healthcare infrastructure, particularly in the Tohoku region. Restoring these services to the affected areas has been a national priority.
Similarly to Germany’s socialized health insurance system, Japan’s healthcare system centers on mandatory employment-based insurance. Health spending is 9.5% of their gross domestic product. Japan has universal coverage that is comprehensive, including dental and prescription drug coverage. Average annual spending per person is $3,035, which breaks down as $1,927 from government funds, $71 from private insurance, and $360 out-of-pocket by consumers. With the graying of their population, approximately 90% of Japan’s healthcare costs are the result of the elderly’s utilization of the healthcare system. It is anticipated that Japan will triple government spending on health care in the next 20 years (NPR News, 2008; OECD, 2012a). Like the United States, Japan is very focused on the integration of technology in health care; however, they are not as advanced in the use of technology. Released in 2010, the New Strategy in Information and Communications Technology (IT), outlines four goals regarding the health sector: (1) to develop patient electronic medical records that can be accessed by all providers; (2) to develop health information technology and telehealth platforms that help link patients with doctors and nurses in underserved areas; (3) to create a platform that can monitor pharmaceutical prescriptions and adverse events in real time in order to improve patient safety and monitoring; and (4) to create a claims database of all conditions and interventions to facilitate assessment of community needs and development of interventions (Michael J. Bass Group, 2013). In spite of a number of initiatives over the past decade, electronic health records have not been widely used.
France
France’s healthcare system has many characteristics of a socialized health insurance program similar to Germany and Japan. Many healthcare experts feel that France’s system should be used as a benchmark when retooling the U.S. healthcare system. In 2011, health spending was 11.6% of their gross domestic product, which is tied with Germany as the third most expensive in the world. They have universal coverage for approximately 99% of French citizens. France has several health insurance funds heavily regulated by the government. The largest fund, the General National Insurance Scheme, covers approximately 80% of French residents. There are two secondary funds for the self employed and agricultural workers. In 2011, average annual spending per person was $4,118 (OECD, 2012b).
Payroll taxes provide the largest source of funding. The employed have 20% of their gross salary deducted to fund healthcare funding. Nearly 90% of citizens have a supplemental insurance policy from private for-profit insurers that they purchase from their employer. Often, the employer pays for the supplemental policy (OECD, 2012b).
Private health insurers are central to the French system because of the supplemental insurance policies that most citizens purchase. More than 118 insurance companies offer some form of health insurance coverage. The national system pays 100% of costs for 30 chronic conditions including cancer and diabetes (OECD, 2012b). Unlike the United States, the government makes it very difficult for insurance companies to deny any coverage because of preexisting conditions. Citizens who are very ill receive increased care and coverage, which is unlike the U.S. system where individuals may go financially bankrupt because of their cost sharing during a chronic disease.
All physicians in France participate in the nation’s public health insurance (like Medicaid). The average American physician earns more than five times the average U.S. wage while the average French physician makes only about two times the earnings of the average French wage. However, in France, medical schools, although extremely competitive to enter, are tuition free. Therefore, French physicians enter their careers with minimal debt. Unlike U.S. physicians who pay high malpractice premiums, they pay much lower malpractice insurance premiums because their society is much less likely to sue a physician. French physicians have less administrative expenses because the government has created a standardized efficient system for physician billing and patient reimbursement using electronic funds. It is interesting to note that the French government allows physicians to charge more than the government’s reimbursement schedule, although physicians employed by hospitals are not allowed to set their own fees. Most physicians do not overcharge because of the intense competition in their field (Dutton, 2007). The government has also attempted to limit the use of prescription drugs by focusing on less expensive, generic type drugs. Because physicians prescribe a tremendous amount of drugs on an annual basis, the French government recently developed a list of drugs that would not be reimbursed by the government. However, a recent study indicated that 90% of asthmatics did not receive the appropriate medication. Citizens may purchase drugs not on the reimbursable list for which they will have to pay (OECD, 2012b).
France’s healthcare system is experiencing a billion dollar deficit that is largely responsible for France’s overall budget deficit. The French government is examining a healthcare system based on taxes, fees, and income levels. Consumers have had no restrictions on physician selection; they may visit several physicians before they find a physician they prefer. This type of medical nomadism drives up healthcare costs. In response to this issue, in 2005, the government established a coordinated care pathway, which is similar to the U.S. managed care system (Tanner, 2008). Individuals are recommended to choose a preferred doctor and follow the doctor’s pathway for their care. At this point, this is not a mandate; this is a choice for the citizens. The French had the highest level of satisfaction with their healthcare system worldwide (Tanner, 2008).
In a 2013 Bloomberg Business Week article, the healthcare system is having tremendous financial problems, although it appears to be working. Their life expectancy is higher than the United States, their infant mortality rates were half of the United States, and their heart disease and obesity rates are lower than the United States. The government feels the system may only last 5–6 more years and feels healthcare reform is desperately needed. The government is now requiring physicians to reduce the number of drugs they prescribe and to substitute generics, which will save approximately $700 million annually. They are also fining pharmacists who sell too many brand name drugs. Critics say the French government must examine the entire system to cut costs in order for the system to survive (Torsoli, 2013).
Switzerland
Switzerland’s healthcare system is considered one of the best in the world, and like the United States, the system must be carefully analyzed due to the increase of chronic disease rates in the country. It is unique because all residents are required to purchase health insurance, so, in a sense, it is a country with universal healthcare coverage. Approximately 99.5% of Swiss have health insurance. Health spending is 11.7% of their gross domestic product. They are tied with France as third most expensive of the OECD countries. They have universal coverage with individuals buying insurance directly from private insurance providers. The Swiss system is similar to the “managed competition” healthcare plan proposed by the Clintons in the early 1990s (Shafrin, 2008). Swiss law requires all citizens to purchase a health insurance package. Insurers cannot reject an applicant based on his or her health status. Healthier consumers pay higher premiums to subsidize the costs for the less healthy. Nonsmokers pay less costly premiums than smokers. Insurers compete on price.
Unlike the other countries discussed in this chapter, few Swiss employers provide insurance or contribute to insurance so individuals bear the full cost of insurance plans. They pay twice the amount of out-of-pocket expenses than the United States. Average annual spending per person is $5,270 (OECD, 2012a).
The government subsidizes the indigent. Their healthcare insurance industry is private but regulated by the government. Their citizens pay more for health insurance in Europe than other countries. The government controls prescription drug prices, of which consumers pay 10% (Rovner, 2008). Like the United States and Japan, Switzerland has focused on health technology. Unlike the United States, Switzerland has strong regulations for nonphysician healthcare professionals such as nurse practitioners, which results in more expensive provider care. The government also sets rates for all providers and hospitals. Insurance companies may not make a profit on a basic insurance plan, which is very comprehensive, but can make a profit on supplemental insurance policies that cover dental, alternative medicine, or private or semiprivate hospital rooms. Consumers, however, can adjust their premium up or down by choosing a larger or smaller annual deductible, or by joining an HMO-type plan. Switzerland ranks second only to the United States in the ability of patients to choose their provider (Rovner, 2008; Shafrin, 2008; Tanner, 2008).
LOCAL GOVERNMENT HEALTHCARE REFORM
Massachusetts Universal Healthcare Program
In April 2006, the state of Massachusetts passed legislation to implement a type of universal healthcare coverage for its residents. The legislation mandated that all adult residents obtain health insurance coverage by July 1, 2007. At the time, 90% of residents had health care; the mandate would result in 98% of residents having health insurance. The cost would be based on the income of the individual. For those residents who did not register, a financial penalty of up to 50% of the health insurance plan cost would be assessed. By July 1, 2007, employers with 11 or more employees were required to provide health insurance coverage or pay a fair share contribution of $295 annually per employee. Employers were also required to offer a Section 125 Cafeteria Plan that permits employees to purchase health care using pretax funds. A specially designed health coverage option was available for residents 19–36 years of age (Brown, 2013).
As part of the healthcare reform, the state established a clearinghouse system, the Commonwealth Health Insurance Connector, which facilitated the buying, selling, and administration of affordable, quality, private insurance coverage for employers with 50 or fewer employees. A major component of this reform was the provision of government-funded subsidies to low income individuals to assist with the purchase of health insurance. Plans offered through the Commonwealth Care have no deductibles and are offered by Medicaid managed care organizations (Commonwealth Health Insurance Connector, 2013).
Any resident could purchase coverage through the clearinghouse or nonresidents could purchase insurance if their employer designated the nonresident as part of their group plan. Insurance purchased through this clearinghouse could be transferred within the state, during periods of unemployment, part-time employment, or self-employment (Haisimaier & Owcharenko, 2006). As a result of this program, an estimated 440,000 individuals have health insurance coverage. However, a major problem resulting from this new program is a lack of primary care physicians. Many uninsured that now have insurance require the services of a primary care physician. There are now huge waiting lists to obtain appointments for an initial visit. This problem is reflective of the geographic maldistribution of primary care physicians in the United States—there are more specialists than there are primary care physicians. The state has passed incentive legislation, such as loan forgiveness for their medical training, to encourage primary physicians to practice in Massachusetts (Brown, 2008). Despite this issue, this program is being examined by other states as a way to provide more health insurance coverage for those who are underinsured.
As a result of the program, the state of Massachusetts has the highest rate of healthcare coverage in the nation. Of the previously 439,000 uninsured residents, 83% obtained insurance through publicly funded programs. Residents had eight plans to choose from. Like the Affordable Care Act, those individuals who could afford a health insurance plan but did not enroll received a fine. The fine in Massachusetts ranged from $19 a month to $105 per month, depending on income. As a result of this mandate, Massachusetts spends $9,278 per person annually, which is one of the highest in the country.
Hospitals are seeing fewer uninsured patients, and visits to the emergency rooms for primary health care are down by approximately 33%. A benefit of this program is a healthier population. The current governor has been able to reject healthcare premium rate increases as well (Hirschkorn, 2012).
Healthy San Francisco Program
In February 2006, then San Francisco Mayor Gavin Newsom created a Universal Healthcare Council to develop a plan to provide access to health care for San Francisco’s uninsured adults. This collaborative effort, comprised of representatives from the health care, business, labor, philanthropy, and research communities, met for 4 months. The Council reviewed demographic and actuarial data, and heard from community advocates and employers to identify and quantify the needs of the uninsured. As a result of these meetings, in April 2007, the city’s Healthy San Francisco (HSF) Program was established and it made comprehensive health care available to the 73,000 uninsured San Francisco residents between 18 and 65 years of age. The San Francisco Department of Public Health (DPH) is responsible for the overall planning, development, implementation, and ongoing administration of Healthy San Francisco. Those eligible are required to obtain care at the San Francisco Medical Home Network, which consists of public health clinics, community clinics, and private providers.
Employers with 100 employees or more are also required to spend $1.76 per work hour per employee on health benefits. Employees with 20–99 employees are required to spend $1.17 per hour. It is not an insurance program, but a restructuring of the county’s program for the uninsured (Department of Public Health, San Francisco, 2013). This type of managed care program provides inpatient and outpatient care, prescription coverage, lab services, and treatments for mental health and substance abuse. Any resident is eligible to apply for the program regardless of income status, pre-existing conditions, or immigration status. Those eligible must choose a primary care provider home among the 14 clinics and they are provided with an identification card and a handbook explaining the services. Small fees are charged based on income. Recent data indicated that 70% of enrollees have incomes 100% at or below the federal poverty levels. As of May 2009, there are 41,000 enrollees in the program (Katz, 2008). Patient satisfaction surveys indicate the enrollees are very pleased with the HSF and would encourage others that are eligible to take advantage of the program (Kaiser Family Foundation, 2009).
Both the Massachusetts and San Francisco programs focus on the uninsured in their geographic areas and attempt to provide affordable and quality medical care to all individuals, regardless of income.
LESSONS TO BE LEARNED FROM OTHER HEALTHCARE SYSTEMS
Japan, France, and Switzerland have different types of universal health insurance programs, but their systems all have flaws. Although Japan ranks at or near the top in the OECD country rankings for infant mortality rates and life expectancy, there are issues with their system. Like the United States, employer insurance provides a large percentage of their health care. Like the United States, the elderly use the healthcare system more than any other demographic and, as a result of this, Japan’s healthcare spending is expected to triple over the next several years. In the United States, Medicare spending continues to be an issue; however, the Affordable Care Act has developed financing models for Medicare providers that may rectify this major problem.
France, which has been applauded for a quality healthcare system, also has financial problems. Similar to the United States, employers pay a portion of an employee’s health insurance premium. However, unlike the United States, employers are mandated to pay a percentage of the employee’s salary to a national health insurance program, not to a private health insurance plan. In France, the taxes on tobacco, alcohol, and pharmaceutical company revenues are used for health care. Similar to the United States, private health insurance companies participate in their healthcare industry because 90% of citizens purchase supplemental insurance. However, unlike the United States, the sicker a citizen/resident becomes, the more coverage he or she receives from the government. There is a mandate in the ACA that prohibits health insurance companies from denying coverage based on catastrophic illness. That mandate is a positive step in improving health care for those who are seriously ill. There are 30 chronic conditions for which the French government will pay the coverage, such as cancer and diabetes. In the United States, some citizens become bankrupt if they have chronic conditions because they cannot pay for the out-of-pocket expenses. France’s healthcare providers all participate in public health insurance, which is similar to Medicare and Medicaid. Unlike the United States, physicians voluntarily enroll in the program. The French providers earn much less than U.S. providers but medical school tuition is free.
As with the U.S. system, France is experiencing a huge budget deficit for health care. Their government is now examining the possibility of developing a new system that is based on increased taxes, fees, and the income of individuals. There is a continual outcry regarding raising individuals’ personal taxes for a universal healthcare program in the United States. Like the United States, France is developing a managed care–type program that will encourage citizens to select a provider who will become the gatekeeper for their care. Managed care contained costs in the United States during the 1990s and has become commonplace in the U.S. healthcare system.
Switzerland has an expensive healthcare system. The program is similar to the new healthcare system in Massachusetts because they both require all of their residents to purchase healthcare insurance. Like Japan, Swiss insurers cannot reject any applicant based on their health status. They also cannot make any profit on the basic insurance package but can make a profit on the supplemental insurance packages that most citizens buy. The government supports the indigent like the United States does with its Medicaid program.
The Affordable Care Act has targeted insurance companies by requiring them to spend at least 80% of premium revenues on providing quality care. The Affordable Care Act has also imposed a flat annual fee on the pharmaceutical companies, makers of medical devices, and health insurance providers, based on market share. There is also a 10% tax on indoor tanning bed facilities. Those monies will be used to support the public portion of the U.S. healthcare system.
CONCLUSION
The U.S. healthcare system continues to evolve. Technology will continue to have a huge impact on health care. Consumers have more information to make healthcare decisions because of information technology. Healthcare providers have more opportunities to utilize technology in their delivery such as robotic surgery, e-prescribing, and clinical decision support systems that will assist them with diagnoses. The Green House Project is an exciting initiative that may transform how long-term care will be implemented. As our population becomes grayer, more citizens will want to live as independently as possible for a longer period of time and the Green House Project is an excellent template for achieving this goal. All of these initiatives are exciting for the healthcare consumer. The implementation of an EHR, which will enable providers to share information about a patient’s health history, will provide the consumer with the opportunity to obtain more cost-effective and efficient health care. The Veterans Administration hospitals use the EHR system. Duke University Health System also uses an EHR system across North Carolina (Ritzenthaler, 2009). There are hospitals, physician practices, and other healthcare organizations that utilize EHR systems across the country. Even though implementing the system nationally will be extremely expensive—costs have been estimated in the billions—it will eventually be a cost-saving measure for the United States. The Affordable Care Act has provided many incentives to improve the quality of and access to the U.S. healthcare system. The Centers for Medicaid and Medicare Innovation has over 40 demonstration projects that focus on different types of financing models that are based on the performance of healthcare providers.
The discussion on the different country healthcare systems analyses indicate that all countries have problems with their healthcare systems. Establishing a universal healthcare system in the United States may not be the answer. There are aspects of each of these programs that could be integrated in the U.S. system. There were surprisingly many similarities. The major differences were the control the government placed on pharmaceutical prices and the health insurers. They limited their profitability in order to increase healthcare access to their citizens. The main difference between these three countries and the United States are the citizens’ willingness to pay more so all citizens can receive health care. That collectivistic attitude is not prevailing here in the United States; that would be difficult to change. However, the mandates for both business and individuals to purchase health insurance coverage through the establishment of state health insurance marketplaces should improve the overall health of the United States.