Copyright © 2008 Delmar. All rights reserved. Chapter 7 Health Care Organization and Financing

Copyright © 2008 Delmar. All rights reserved. 2 Historical Developments National Health Insurance (social insurance) –Germany, 1833 –1921 Shepherd-Towner Act Gave matching funds to states that would provide prenatal and child health care

Copyright © 2008 Delmar. All rights reserved. 3 Historical Developments 1965 President Roosevelt’s Great Society –Medicare and Medicaid States and federal government accountable for long term care 1980s DRG’s –Determined length of inpatient care –Growth in home care

Copyright © 2008 Delmar. All rights reserved. 4 Insurance-Based Care Public insurance –Medicare –Medicaid –TRICARE Insurance-based care –Purchased by employer/employee

Copyright © 2008 Delmar. All rights reserved. 5 Private Insurance Massachusetts Health Insurance Company –First private plan in the United States –Montgomery Ward first company to provide benefits to workers unable to work due to illness or injury –1920s Blue Cross plan started

Copyright © 2008 Delmar. All rights reserved. 6 Private Insurance Third Party Payer –Company that pays for health care for a business or individual –Insured individual first party –Second party is the business/company individual works for

Copyright © 2008 Delmar. All rights reserved. 7 Private Insurance Retrospective payment system Prospective payment system Fee for service Premiums Deductibles Copayment

Copyright © 2008 Delmar. All rights reserved. 8 Private Insurance Medical Savings Accounts –Tax exempt –Individual sets aside money to be used to cover cost not covered by insurance

Copyright © 2008 Delmar. All rights reserved. 9 Private Insurance Managed Care Plans –Form of private insurance –Gate keepers Consumers have less choice

Copyright © 2008 Delmar. All rights reserved. 10 Managed Care Health Plans Preferred Provider Organizations (PPO) –Fee for service –Consumer chooses provider from a select group –Negotiated discounted rate –Consumers retain their ability to choose provider

Copyright © 2008 Delmar. All rights reserved. 11 Managed Care Health Plans Health Maintenance Organization (HMO) –HMO contracts with a group of physicians and specialist –Consumer does not have an option to choose provider –Fixed fee –Less flexible

Copyright © 2008 Delmar. All rights reserved. 12 Public Insurance Funded by state and federal governments –Medicaid Title XIX Determined by income and resources No age limit TANIF State Child Health Plan –Spend down

Copyright © 2008 Delmar. All rights reserved. 13 Public Insurance Medicare –Title XVIII federal program for elderly age 65 and older –Three parts: Hospital Insurance Part A Medical Insurance Part B Prescriptions Part D –Medigap

Copyright © 2008 Delmar. All rights reserved. 14 Public Insurance TRICARE –Active duty, retired service personnel, eligible family members, survivors –Funded through Department of Defense –Consumers have two options: TRICARE Prime (managed care) TRICARE Standard (fee for service)

Copyright © 2008 Delmar. All rights reserved. 15 Noninsurance-Based Models Managed competition –Supply and demand Accountable Health Plans (AHP) Health Insurance Purchasing Cooperatives (HIPCs)

Copyright © 2008 Delmar. All rights reserved. 16 Noninsurance-Based Models Universal coverage –Single payer system –Provides access to health care to all –One agency paying expenses rather than multiple payer system

Copyright © 2008 Delmar. All rights reserved. 17 Challenges for Public Health Nurses Shrinking funds Minimal funding Increase in health care cost Organizational changes in the health care system