Medical 15

Copyright 2012 by Pearson Education, Inc. All rights reserved.

Chapter 15

Health Care Reform and Social Policy in the United States

Medical Sociology Twelfth Edition

William C. Cockerham


Introduction

Major issues in the public debate about health care delivery in the United States:

1) Rising costs

2) Equity

3) Geographic distribution of services

Recent health reforms address some of these issues

Promotes better access to health insurance


Introduction

Importance of access to health insurance:

Previously uninsured persons had worse health and used more services when they became eligible for Medicare coverage at age 65

Uninsured more likely to hesitate before seeking treatment, even in emergencies


Rising Costs

Per capita health care expenditures in the U.S. are the highest in the world

1980 per capita expenditures: $1,100

2007 per capita expenditures: $7,681

Costs influenced by a number of factors:

Aging of the population

Increases in hospital expenses and doctors fees

Increased cost of health insurance

Increased use of and advertising for prescription drugs


The Road to Health Care Reform: Initial Federal Efforts

During the 20th century, several U.S. presidents have attempted or recognized the need for health care reforms

Only Johnsons establishment of Medicare and Medicaid in 1965 was successful

Public resistance and the opposition of the AMA have hampered efforts at reform



Addition of Medicare and Medicaid to the Social Security Act in 1965 marked a new level of involvement in U.S. health care by the federal government

Medicare and Medicaid have provided needed health services for the old and those in poverty where these services were not previously available



Medicare

Federally administered program

Provides hospital and medical insurance for people aged 65 years or older, regardless of financial resources

Includes disabled people under the age of 65 who receive cash benefits from Social Security

2006 added prescription coverage to benefits

Covers 14.8% of the population



Medicaid Welfare program operated by individual states

States and the federal government share the cost of health care for the poor

Each state is required to cover all needy persons receiving cash assistance

May also include the medically needy, the aged, blind, and disabled poor as well as their dependent children and families

Covers 15.5% of the population


The Road to Health Care Reform: Clinton

President Clinton proposed a plan of national health insurance in 1994

Plan failed due to: Anti-insurance lobbying efforts

Lack of consensus between the Democrats and Republicans in Congress

Growing public uncertainty

Highlighted the need for reform

Resulted in the reorganization of American health care into a delivery system in which managed care is now the dominant approach in the private sector


The Road to Health Care Reform: Managed Care

In the early to mid-1990s, private health care shifted away from a largely office-based, fee-for-service system to an increasingly group- or organization-based managed care system

Emerged indirectly as a response to the government imposed DRGs for Medicare services

Diagnostic related groups (DRGs)

Schedules of fees placing a ceiling on how much the government will pay for specific services rendered to Medicare patients by hospitals and doctors



Managed care organizations Control the cost of health care by monitoring the work of

doctors and hospitals, limiting visits to specialists within a particular managed care network and to all physicians outside it, and requiring prior authorization for hospitalization

Capitation fees Financing system employed by managed care organizations

A fixed monthly sum is paid by the subscriber and his or her employer that guarantees care to that person and the persons immediate family, with little or no additional cost

Discourages inefficient and unnecessary treatment



Initially kept rising costs in check

Pressure by physicians, the media, and politicians responding to patients helped dilute cost controls

Especially the requirement to obtain approval from a primary care physician before seeing a specialist in many managed care programs


The Road to Health Care Reform: State Efforts

Some individual states have implemented their own plans in order to increase coverage: Hawaii

In 1974 required all employers to contribute to health insurance

Tennessee Converted Medicaid into the TennCare managed care

program

Vermont, Illinois, Washington Provide health care for children, with subsidies for premiums

Massachusetts Requires all residents to have health insurance


The Road to Health Care Reform: 2010 Reforms

Despite widespread opposition and concern from various interest groups, politicians, and the general public, President Obama passed significant health reforms in 2010

Patient Protection and Affordable Care Act

Will take effect in 2014

Estimated that 95% of Americans will be covered by health insurance by 2019

Few changes for people who already have insurance



Changes introduced by the Patient Protection and Affordable Care Act: 1) Persons with preexisting medical conditions can no longer be

denied coverage because of those conditions 2) A minimum level of benefits to be set by the federal

government must be provided in all health insurance plans 3) State insurance exchanges will be established that will offer a

range of competitive health care plans at affordable prices 4) Persons not covered by their employer will be able to purchase

coverage through the state exchanges 5) Persons under the age of 65 who already have health insurance

may also purchase plans from the exchanges and those who earn up to four times the federal poverty lineabout $88,200 for a family of four in 2010will receive government subsidies to help pay the cost



Changes introduced by the Patient Protection and Affordable Care Act: 6) Low-income persons under the age of 65 earning below 133

percent of the federal poverty lineabout $14,000 for an individual and $29,327 for a family of four in 2010will be covered by an expanded Medicaid program

7) Small businesses can buy insurance for their employees through the exchanges and get tax credits

8) Children may remain on their parents health insurance plan until age 26

9) Most Americans (American Indians and religious objectors would be exempt) would be required by law to purchase health insurance or pay a fine, while employers with more than 50 workers who do not provide coverage will also pay fines



Several states have joined in a lawsuit to challenge the federal law requiring Americans to have health insurance

Claim it is unconstitutional and unprecedented to require people to buy any commercial good or service as a condition of lawful residence in the United States


Equity in Health Services

Problem of equity in health services lessened with health care reform but still remains a problem in American society

Especially true for individuals dependent on public health care, those without health insurance, and both the urban and rural poor since health care may simply not be available where they live


Geographic Distribution of Services

A major factor in obtaining adequate medical care for some people is the numerical shortage of physicians serving patients in rural areas and urban slums Most physicians prefer to practice in urbanized

settings One out of every 20 counties in the U.S. lacks

physicians More than half of all counties do not have a

pediatrician

There are a few signs that the distribution of physicians is beginning to improve


Geographic Distribution of Services

Another factor in the maldistribution of physicians is that of overspecialization Has reduced the number of doctors engaged as

general practitioners in primary care and family practice

Medical students often prefer to specialize because: Can focus on a narrower and more manageable body of

knowledge

Increased prestige and income afforded to specialists


Overview of Health Care Delivery

The existing health care delivery system in the United States is a conglomerate of health practitioners, agencies, and organizations, all of which operate more or less independently

Greatest portion of all patient services is provided in offices and clinics by physicians who sell their services on a fee-for-service or per capita fee basis in a managed care network

Followed by services provided by hospitals



Official agencies

Public organizations supported by tax funds

Support and conduct research, develop educational materials, protect the nations health, and provide services designed to minimize public health problems

Voluntary agencies

Charitable organizations who solicit funds from the general public and use them to support medical research and to provide services for disease victims



Health maintenance organizations (HMOs) Managed care prepaid group practices Individual pays a monthly premium for comprehensive health

care services

Preferred provider organizations (PPOs) Relatively new form of managed care health organization Employers who purchase group health insurance agree to send

their employees to particular hospitals or doctors in return for discounts

Allied health enterprises Manufacturers of pharmaceuticals and medical supplies and

equipment, which play a major role in research, development, and distribution of medical goods



Traditional fee-for-service system is modeled on the principle of the open market High-quality services and affordable prices are

supposed to result from competition among providers

This system is not a good example of a competitive marketplace Fundamental law states that when the supply of a

product exceeds the demand for it, prices should drop Does not apply to medicine since doctors and

hospitals effectively create their own demand and provide services at prices they set


Health Care: A Right or a Privilege?

Conflict theory Sociological perspective which takes the position

that social inequality leads to conflict, which leads to change

Has its origins in the work of Karl Marx and Max Weber

Modern focus is not just on class conflict but also on competition between interest groups, as they maneuver for advantages in democratic political systems



Modern societies are characterized by conflict between: Democratic principles

Emphasize equality and universal rights

The organization of economic services Involving the production, exchange, and consumption

of goods and services

Features inequality

Health reform is really about whether medical care is a right of all Americans or a privilege



As a privilege:

Medical care is a commodity

Doctors entitled to high incomes because of difficulty and high value placed on obtaining necessary skills

Generalized opposition to the welfare state

The best way to help the poor is to provide them with jobs so that they can buy medical care like everybody else



As a right:

Health care should be an opportunity

Emphasizes its special importance to society in relieving suffering, preventing premature death, and restoring the ability to function to the people who live in it

Society has an ethical obligation to provide health care



Movement toward conceptualizing and establishing health care as a right in the capitalist economy of the United States

Consistent with other measures associated with being a welfare state

Individual rights of citizenship, not ownership and control of property, serve as the basis for political representation and entitlement to public programs

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