U.S. Health Care Delivery : An Overview

Objectives Gain broad understanding of how health care is delivered in the United States Learn main characteristics of U.S. health care delivery system Recognize differences between U.S. health care delivery system and national health programs of most developed countries Learn of U.S. health care delivery subsystems

What is health care delivery? What is a health care delivery system?

U.S. Health Care Delivery: A Systems Framework Health care delivery in the United States – Is based upon a foundation of historical, cultural, social, and economic factors – Consists of a logical arrangement of various interrelated and interdependent components – Demonstrates a progression from “inputs” to “outputs” – Despite appearances, it is not an accident!

Outpatient & Primary Care Inpatient & Acute Care Long-term & Post-acute Care Structure & Processes Human Resources Technology Financing Cost Access Quality Policy & Reform Outputs Inputs Managed Care & Health Networks Underserved Populations U.S. Health Care Delivery: A Systems Framework (Adapted from Shi & Singh, 2013) Cultural, Social, & Economic Factors System Foundations Historical Factors

U.S. Health Care System: The Main Characteristics The U.S. health care system is unique in comparison to the health care systems of other developed countries Ten main areas of distinction

❶No central governing agency, Little integration and coordination Not centralized Complex and costly A variety of payment, insurance, and delivery mechanisms Large role of private sector Limited but important role of federal & state governments

Health Expenditures by OECD Country (Percent of GDP) Source: OECD Health Data 2009, OECD (

❷Technology driven, Focused on acute care Center of medical research & innovation – Creates growth in demand for new services – Negative outcomes accompany benefits Is the latest or most high-tech solution always the best? Would increased emphasis on primary care prevent acute conditions requiring high-tech intervention?

❸High on cost, Unequal in access, Average in outcome The U.S. spends more than any other developed country on health care Despite rising expenditures, many residents have limited access to basic care Despite rising expenditures, the U.S. lags behind other developed nations in numerous population health measures

Health Expenditures by OECD Country Source: OECD Health Data 2009, OECD (

Health Expenditure Growth Trends (% of GDP) Source: OECD Health Data 2009, OECD (

Life Expectancy vs. Health Spending Source: OECD Health Data 2009, OECD (

❹Imperfect market conditions The payer is not always the patient Competition is restrained Patients are not always well-informed Information is difficult to obtain Patients do not directly bear service costs Patients’ ability to make decisions is limited

❺Government as subsidiary to private sector Dominant private sector – Built upon American traditions Government spending fills in the gaps – Environmental protections – Support for research & training – Care for vulnerable populations

❻Market justice vs. social justice: Conflict throughout health care U.S. health care system involves a fusion of these two principles Differing views of how to distribute care – Ability vs. need What might be the consequences of a system that favors market justice? Or social justice?

❼Multiple players & Balance of power U.S. health care involves multiple players Self-interests of players are often at odds What might be the consequences of a system with competing interests and voices? – Good? Bad? Is reform possible?

❽Quest for integration & accountability Efforts in the U.S. to promote primary care as the organizing hub for continuous, coordinated, and comprehensive services Emphasizes patient-provider relationships as a means to improve individual and population Patient-provider relationships also require accountability

❾Access to health care services is selectively based on insurance Access is granted to individuals who: – Have health insurance through employers – Are covered under government programs – Can afford to buy insurance with private funds – Can pay for services privately What are options for the uninsured?

❿Legal risks influence practice behaviors “Litigious society” Private health care providers are increasingly becoming more susceptible to litigation – Risk of malpractice lawsuits – Costs of time, money, reputation, etc. – Defensive medicine a way to avoid litigation

Comparing to Health Care Systems of Other Developed Countries National health care programs with universal access Three basic national health care system models – National Health Insurance (e.g., Canada) – National Health System (e.g., Great Britain) – Socialized Health Insurance System (e.g., Germany)

Models of Health Care Delivery Bismarck Model – Sickness funds financed jointly by employers & employees Beveridge Model – Health care provided & financed by government through taxes National Health Insurance Model – Government insurance purchases care from private providers Out of Pocket Model – If you have the resources, you can pay for care

U.S. Health Care Delivery Subsystems In contrast to a universal health care delivery system, multiple subsystems have developed to comprise the U.S. health care delivery system – Managed care – Military – Vulnerable populations – Integrated delivery

U.S. Health Care Delivery Subsystems Managed care – Developed to contain health care costs & expenditures – Seeks to achieve efficiency by integrating basic functions of health care delivery – Employs mechanisms to control or manage utilization of medical services – Determines the price at which services are purchased and how much providers are paid – Most dominant health care delivery system in U.S.

U.S. Health Care Delivery Subsystems Military – Available free-of-charge to active-duty military personnel – Well-organized, highly integrated system – Combines public health with medical services – In general, the military medical care system provides high-quality health care

U.S. Health Care Delivery Subsystems Vulnerable populations – Poor, uninsured, minority or immigrant status – Live in geographically or economically disadvantaged communities – Receive care from “safety net” providers – Without safety net providers, patients have to forego care or seek care in hospital emergency departments (if one exists nearby) – Subsystem faces enormous pressure

U.S. Health Care Delivery Subsystems Integrated delivery – The hallmark of U.S. health care industry over the past decade – and becoming larger – Organizational integration to form integrated delivery systems (IDS) or networks – Strategic linkages among hospitals, physicians, and insurers – Objective: have one health care organization deliver a range of services

U.S. Health Care Delivery Subsystems Long Term Care – Medical and nonmedical care that is provided to individuals who are chronically ill or who have a disability. – Health care and support services for daily living – Not covered by Medicare – LTC insurance is offered separately, but it can be expensive – Expected to have more integration with the acute care system

U.S. Health Care Delivery Subsystems Public Health System – Improve and protect community health Monitoring health status Diagnosing and investigating, informing and educating health problems and hazards Developing policies Enforcing laws and regulations Assuring competent professional health workforce Research

What We’ve Learned The U.S. health care delivery system is unique – Characterized by a patchwork of subsystems – Differs considerably from systems of other developed countries – May be viewed according to a systems framework to generally understand the various system components and features