Transcript
Issues Related to Health Care Financing
Overview of the size and growth of the health care sector
The distribution of personal health care services
Flow of Funds for Health Care Nature of Financing Decisions
Judith R. Lave, Ph. D.January 2004
Brought to you by
Share of National Health Expenditures, By Type 2002
Total (Billions) $1,553
Total 100%
Personal Health Services 86.3
Prog. Admins + Net Cost of Health Insurance 6.8
Research & Construction 3.6
Public Health 3.3
Per Capita Expenditures $5,440
Brought to you by
Notes on Data
Summary Information: Jan/Feb Issues of Health Affairs (K. Levit et al. Health Spending Rebound Continues. Health Affairs. 23(1), 2004.
Complete data:www.cms.gov: Search: National Health Expenditures, Click: Health Accounts. Click: Tables
Brought to you by
Annual Percent Change in National Health SpendingSelected YearsCurrent Dollars
1970-1980 12.9%
1980-1988 10.8
1988-1993 9.3
1993-1997 5.3
1997-2000 6.2
200-2001 8.5
2001-2002 9.3
Brought to you by
Many Definitions of Healthcare Costs
Healthcare Expenditures (p x q) Prices of Individual Services Premiums for Health Insurance Out-of-Pocket Payments % of GDP to Health Care (14.9%)
Brought to you by
National Health Expenditures as a Percent of GDP
1970-2010
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
Accelerated growth
Managed care andBBA impacts: “one-
time” effects on price and volume levels
Moderate Growth
Brought to you by
Distribution Expenditures on Personal Health Care 2002
Prescription drugs12.1%10.4%
Nursing--home care
25.3%
Physician &Clinical Services
36.3%Hospitals
15.9%
Other healthservices
Brought to you by
Percentage Change in Expenditures2000-20002
Category Percent Change2000-2001 2001-2002
Overall 8.5% 9.3%
Hospital Care 7.5 9.5
Physician and Clinical Services
8.5 7.7
Nursing Home&Home Health 5.8 4.9
Prescription Drugs 15.9 15.3
Brought to you by
prem
ium
s,
gener
al ta
xes,
payro
ll ta
xes,
stat
e lo
tter
ies
Households Tax payers
The Financing of Health Care
out-of-pocket payments
fee-for-service,
budgets,
capitation
medical services
“claims”
Financing Side Reimbursement Side
Third Parties
Government Agencies
Insurance Companies
(Health Plans)
prem
ium
s,
gener
al ta
xes,
payro
ll ta
xes
Providers
(doctors, hospitals, dentists, etc.)
Patients
Employers
Employees
Nonelderly Americans With Selected Sources on Health
Insurance Coverage: 2002
Type of Coverage % of nonelderly population *
Employment-Based CoverageIndividually PurchasedPublic Medicare Medicaid Tricare/CHAMPVA No Health Insurance
64.26.7
15.92.3
11.92.8
17.3Population: 250.8 million * Does not add up to 100% because people can have more than one source of health insurance
Brought to you by
Sources of Supplemental Coverage: Among Non-Institutional Medicare
Beneficiaries: 1999Other* 2%
Medicare Only13%
Employer-Sponsored
33%
Medicaid11%
Medigap24%
Medicare HMOs17%
Total = 34.7 million non-institutional Medicare beneficiaries
Brought to you by
No Standard Health Plan
Health Insurance Policies Vary With Respect to:covered servicescovered providers administrative terms under which
services are accessedmethods for paying providers
Brought to you by
Importance of Insurance Coverage
Use of services is a function of price (which depends on insurance structure and coverage) (i.e., Claritin)
Decisions to cover or not cover certain providers/technologies/services can make or break an industry (i.e., physical therapy, mammograms, obesity surgery)
Medicare is often pace-maker on ways to pay providers
Brought to you by
Brief Discussion of HealthCare Financing Terms
Insurance policies vary considerably. They vary with respect to which services will be covered, how much cost sharing will be borne by the policy holder, administration conditions under which consumers/patients access care, what providers will be covered, how much providers will be paid.
Private Health Insurance: Health insurance is purchased in the market by groups (either through the place of business or through professional associations) or by individuals. The premium is the price paid for the insurance policy. Under employer sponsored group health insurance plans, the cost of the premiums is paid in whole or in part by the employer.
Brought to you by
Definitions of Terms in the Following Charts
Direct Patient Payments: This is the total amount paid out of pocket by the patient or by the patient’s family for a given service.
Private Third Parties: This is the total amount paid for a given service on the behalf of the consumer or services. This would include payments made by blue cross, blue shield, a health maintenance organization, Aetna, etc.
Public Federal: This is the total amount paid by the federal government for health care. It includes expenditures made under Medicare, Medicaid, The Veteran’s Administration, etc.
Brought to you by
National Health Expenditures By Source of Funds Selected Calendar Years
1970-2002
32.530.929.024.0 Federal
45.944.042.637.8Public Funds
13.716.523.734.3 Out of Pocket Payments
54.156.057.362.1Private Funds
35.433.627.721.2 Private Health Insurance
5.0 5.9 5.9 6.6 Other
13.413.113.613.7State & Local
100%100%100%100%Total
2002199319801970Source of Payment
Brought to you by
Percent of Personal Health Care Expenditures
Paid Out of Pocket
1990 2002
Total 22.6% 15.8%Hospital 4.4 3.0Physician & clinical services
20.5 10.1
Nursing Home care 40.4 25.1Dental 48.3 44.0Prescription Drugs 55.8* 30.0
*This is for 1992 Brought to you by
Source of Payment for Personal Healthcare: Percent Distribution for Selected Services (2002)
Note: only selected sources enumerated
Medicaid(Fed & State)
Medi-care
Out of Pocket
Private Insu-rance
Total PrivateTotal
Expendi-tures
(billions)Type of Service
49.312.525.17.535.9100.0%103.2Nursing Home Care
17.60.230.047.877.7100.0%162.4Prescription Drugs (99)
5.4….44.049.593.6100.0%70.3Dental Services (99)
12.420.310.149.266.2100.0%339.5Physician Services
17.230.73.033.941.1100.0%486.2Hospital Care
17.419.315.835.855.8100.0%$1,340.2Total Personal Healthcare
GovernmentPrivate
Source of Expenditure (%)
What are some of the problems that
people have with current insurance?
Brought to you by
Employer Sponsored Health Insurance
90% of Private Health Insurance Obtained Through Employer
Employer Share of Premium Excluded from Taxes
Employer Selects Plan Who Bears the Cost?
Economists: The Employee in lower wages Others: The Employer in lower profits
Brought to you by
Question
What are the advantages/disadvantages of getting health insurance through the employer?
Brought to you by
New WrinkleDefined Contribution
1. Pay same amount towards all plans offered by employer.
2. Pay employee fixed amount divided between cash and a catastrophic cap. Employee selects a plan from a network of providers.
3. Pay employee fixed amount to purchase insurance privately.
Brought to you by
A Very Conservative Position
Decide how much you want to subsidize health care—who do you want to help?
Get rid of the incentives that encourage people to obtain their health insurance through their employers.
Eliminate the tax subsidy of employer based health insurance: treat all health insurance equally—probably with a tax credit.
Let people use their own dollars to purchase medical care/insurance—let them make their own trade-offs. (could be defined contribution)
Note: Similar to the A.M.A. position.
Brought to you by
Selected Policies By Third Parties
Control Over Prices Government – Administered Prices
– Prospective Payment SystemHospitals – “DRG’s”Nursing Home – “RUG’s”Home Health Agencies –
“HHRG”Outpatient Department –
- “APC”Rehabilitation Facilities
– “FIM-FRG”
DRG = Diagnoses Related GroupRUG = Resource Related GroupHHRG = Home Health Related GroupAPC = Ambulatory Patient ClassificationFIM-FRG = Functional Independence Measure-Function Related Group
Brought to you by
Development of Managed Care Strongly Encouraged By Capitation
Selection of Physician/Providers who Practice Cost-Effectiveness Care
Capitation of Primary Care (Gate-Keeper and Other Providers)
Utilization Management Care management Preadmission screening Concurrent review Guidelines Disease management
Introduction of Best Practices Brought to you by
35.0%
27.6%
13.8%
8.4%
9.20%
6.10%
7.7%
5.1%
10.3%
25.8%
49.9%
Percent Distribution of Medicare Enrollees andProgram Payments Under Medicare: CY 1998
29.3 Million Enrollees $168.2 Billion in Program Payments
Percent of Persons Served Percent of Program Payments
$25,000 or More
$10,000-24,999
$5,000-9,999$2,000-4,999
$25,000 or More$10,000-24,999$5,000-9,999$2,000-4,999
$500-1,999
$1-499
Am
ou
nt
of
Pro
gra
m P
ay
me
nts
$500-1,999
Brought to you by
Please help us
We need funds, guide us
011-25464531, 011-41425180, 011-66217387
+91-9818308353,+91-9818569476othermotherindia@gmail.com
www.other-mother.in
https://www.facebook.com/pages/Other-Mother-Nursing-Crusade/224235031114989?ref=hl
http://www.linkedin.com/profile/view?id=326103341&trk=nav_responsive_tab_profile
https://twitter.com/othermotherindi
https://cparveen.wix.com/other-mother
A WORLDWIDE MISSITION
Contact Us:-
JOIN US
top related