Welcome to

US Healthcare Systems
Spring 2015!
Anita Franzione, DrPH, MPA

First Thing First,

Outline for Today!
Course

Overview and Expectations

Required Assignments
Introductions by all
Week 1 Lecture
Introduction to US Healthcare Systems
Introduction to ACA

Course Overview and Expectations

Overview of Syllabus
Main

Point:
The syllabus for the class is very
detailed. I expect that everyone
reads it and keeps up with the
assigned readings, assignments,
requirements and deadline!
And check Sakai!

Required Tests and Papers

There will be a short answer memo. You will be

questions on a problem in a health care
organization. Select one problem a write a
response to me in a one page memo to address
it.

The questions are posted in Sakai under

Assignments.

The memo is due March 10, 2015 the day of

the midterm.

Required Tests and Papers

There

will be one midterm exam on

March 10, 2014. It will be an in-class
midterm Details on that will follow
as we have class; will cover the first
8 topics.

Required Tests and Papers

At week 14, students in teams/groups will

present a current event article/issue to the
class.

Students will be randomly assigned into teams

by Week 3. You may request/create a team but
you need to tell me in an email by Week 2
class (January 27, 2015).

This and the memo is to help you think

critically about the issues we are going over.

Required Tests and Papers

There will be a final exam. Date has not

been assigned.

Final exam will emphasize lectures 9

through 14 but will include the entire
course.

Required Assignments for Class

I expected that everyone completes the

materials assigned for each week and
participates fully in class discussions. There is a
lot of information but the point is to look at the
theories and data and see how to apply it in the
real world.

That is what I am here for! Not to have you just

memorize and spit it back to me, but to give you
the tools to help you think and react to the
issues that US Healthcare faces!

Introductions!

Everyone, please introduce yourself to all.

Include where you are in your studies for
public health or whatever your major is,
what your goals are once you get your
degree, and WHY you are taking this class
!!!!

So, whats this class all

about?

Many parts, much history!

New Ride at Disneyland?

US Department of
Health and Human Services

And how many feel.

Even Worse

So?

Overview of Health
Care:
A Population
Perspective

Objectives
Introduce major characteristics of the U.S.
health care delivery system
Provide a broad overview of the U.S. health
care industry: values, policymakers,
priorities, and stakeholders from a
population perspective
Review health care industry: changing
trends, issues and challenges and
opportunities

An Enormous Industry.
U.S. health care:
$ 2.7 trillion; 16 million+ workers; 11% of
U.S. employment; 17% of GDP
Worlds 8th largest economy 2nd only to
France and larger than total economy of
Italy
Thousands of medical practices, provider
organizations, manufacturers, suppliers and
insurers

System Complexity

A vast array of players and payers

Mosaic of business relationships range from
individual doctor-patient to multi-billion dollar
hospital, healthcare and insurance systems
Public (government) and private payment sources
with differing rules, regulations
Poorly aligned infrastructure, medical
specialization result in a confusing labyrinth for
patients and providers

Enduring Challenges

Size and complexity contribute to problems

of:

Limited access, inconsistent quality,

high costs
Unnecessary and wasteful service
duplications

How to make the worlds finest technical

medical capabilities available and accessible
to U.S. population in effective and efficient
ways?

Policy vs. Market-driven Attempts

to Reform the System:
Problems recognized by nations medical
and political leaders for decades; legislative
proposals for comprehensive reform by
eight U.S. presidents dating to early 1900s
Policy-driven reform failed repeatedly while
the market has driven consolidations to
achieve higher quality, effectiveness, lower
costs.

Emerging power of consumer demands

Patient Protection and Affordable

Care Act of 2010 (ACA)
Highest impact policy reform since Medicare
& Medicaid in 1965; the ACA affects
virtually all Americans
Obama window of opportunity to position
reform on national agenda:

problems of major scope & urgency with feasible

solutions; links with other significant issues, e.g.
national deficit; political will

ACA Intended Effects by 2019

Cover 32 M currently uninsured (except
illegal immigrants; low-income who do not
enroll in Medicaid; opt-outs preferring to
pay the penalty)
Merge public health prevention concepts
into practice of personal medical care
through an array of realigned financial
incentives for providers and insurers and
other population-focused initiatives

Collateral Effects of the ACA

Debate

Focused stakeholders on problems of

access, rising costs and questionable
quality of care:
Can prevention and wellness become the
dominant focus of primary care?
Can wellness emphasis actually reduce costs by
preserving health and avoiding costly illnesses?
Can financial incentives produce better patient
outcomes and a generally more healthy
population?

Problems of Health Care

Inexplicable contradictions of objectives
(treatment after the fact vs. prevention)
Variations in performance, quality,
effectiveness and efficiency
Long-standing discord between population
needs reflected by government policies vs.
market goals to contain costs and realize
profits
American people fearful of risks entailed by
change

International Comparisons

Among 7 other developed nations, (U.K.,

Germany, Sweden, Canada, France,
Australia, Japan), U.S. health status ranks
8th on important health status indicators:
Life expectancy at birth
Infant mortality rate
Probability of dying between ages 15 and 60

U.S. health expenses are triple those of

Japan and more than double of the 7 other
nations.

WHO and the Organization for

Economic Cooperation and
Development (OECD)
June 2014

Understanding U.S. Health Care

The public has inadequate understanding of

the health care system
Practitioners fostered mystique to establish and
maintain authority
Tradition of highly educated health care
professionals daunted patients involvement
Treatments and outcomes have remained opaque
to consumers with no accessible information to
inform about provider choices and quality

Understanding U.S. Health Care

Ongoing changes include:

Increasing scrutiny by purchasers (employers and
government ) about quality of outcomes vs. costs
Medical entrepreneurship
More public data about quality, e.g. Hospital and
Physician Compare
Shared decision-making
Internet resources available to all

Indexes of Health and

Disease
The collection of health and disease
statistical data developed from numerous
sources, e.g.:
Medicare & Medicaid claims
Hospital and insurance claims data
State & federal vital statistics,
communicable & infectious disease data
International World Health Organization
data

Natural Histories of Disease

and Levels of Prevention

A matrix of the evolutionary stages of

disease and the points at which health care
services may intervene to:

Prevent disease onset (primary

prevention)
Attenuate disease progression
(secondary prevention)
Rehabilitate to highest achievable
function (tertiary prevention)

Pre-Pathogenesis Period:
Primary Prevention
Health promotion: e.g. health education,
nutrition, safe housing, counseling on
lifestyles and behaviors, periodic exams
Specific protections: e.g. immunizations,
personal hygiene, environmental sanitation,
protection from occupational hazards,
protection from carcinogens

Period of Pathogenesis:
Secondary Prevention

Early diagnosis and prompt treatment: e.g.

case finding measures (individual and
mass); screening surveys; selective
examinations
To cure or prevent disease progression and
prevent complications
To prevent spread of communicable diseases
To shorten the period of disability

Most preventive health care is currently

focused on this level

Period of Pathogenesis:
Tertiary Prevention
Disability limitation: e.g. Treatment to arrest
disease process and prevent further
complications; facilities (interventions) to
limit disability and prevent death
Rehabilitation: e.g. Hospitals/other facilities
for retraining to maximize use of remaining
capacities; employer education about
disabled; selective placement in group
facilities

Figure 1.0.F02: Levels of Application of Preventative

Measures.
Reprinted with permission from H. R. Leavell and E. G. Clark,
Preventive Medicine for the Doctor in His Community: An
Epidemiologic Approach, 3rd edition, p. 21, 1965, The
McGraw Hill Companies, Inc.

Utility of Natural History

Matrix
Focus on the value of prevention versus
after the fact interventions
Planning for community services: Identifies
critical intervention points and suggests
appropriate strategies to maintain optimum
population health status

Major Health Care Stakeholders

Major stakeholder groups support or oppose
reform proposals or other system changes:
American public through consumer groups,
e.g. AARP and disease-specific advocates
(cancers, heart , mental health, etc.)
Employer groups (purchasers)
Provider groups e.g. AMA, ANA, other
professional organizations

Major Health Care Stakeholders

Hospitals, health care facilities, e.g. AHA,
NHPCO, AHCA (nursing homes), etc.
Federal and state governments
Voluntary (not-for-profit) organizations;
Health professions training and education
institutions
Health related industries (pharmaceutical,
device and equipment)

Major Health Care Stakeholders

Complementary and alternative medicine
practitioners
Health insurance industries
Research communities

Rural Health Networks

Federal and state programs recognize

challenges of rural health delivery systems
with support for not-for-profit networks.
Networks:
Cooperate on joint community outreach and
service initiatives
Advocate at local and state levels for rural issues
Negotiate with insurance companies on behalf of
local residents

Rural Hospitals

Challenges: declining populations,

increasing operational costs
Initiatives: links with larger institutions; shifts from
inpatient to outpatient and/or long-term care
services
Federal support since 1991 for limited-service
and critical access hospitals with relaxed
regulations for staffing, bed certification and
reimbursement for telemedicine.

Tyranny of Technology
As technology advanced, more people
denied of its benefits due to costs
Historical emphasis on sophisticated
curative medicine over highly cost-effective
preventive services
Technology assessment questions: Patient
benefit?; Worth the cost?; New better than
previous methods with improved outcomes?

Social Choices of Health

Care

Health care system has failed to lead

prevention

Difficult intervention for behavioral

issues, e.g. tobacco, other
substances; risky sexual behaviors
Health professionals training
emphasizes illness detection and
treatment; poorly prepared (and
compensated) for counseling on
health behaviors

Emerging and Continuing Issues

and Challenges
Aging population
Access to health care
Quality of care
Conflicts of interest

1. Aging Population

By 2030, ~ 20% U.S population 65+; by

2050, ~ 21% 85+
Increased longevity, immigration, culturally
diverse aged
Major gaps in traditional system for care of older,
culturally diverse Americans
Financial gaps in Medicare and Medicaid payment
for older adult basic needs; state burden of
nursing home care

Figure 1.0.F05: Distribution of the Older Population by Age: 2010 to 2050.

Reproduced from U.S. Census Bureau, The Next Four Decades:
The Older Population in the United States: 2010 to 2050.

Figure 1.0.F06: Percent Hispanic for the Older Population by Selected Age Groups for the
United States: 2010 to 2050.

Reproduced from U.S. Census Bureau, The Next Four Decades:

The Older Population in the United States: 2010 to 2050.

ACA Provisions for Aging and

Dependent Populations
Medicaid Money Follows the Person
Community First Choice Option in
Medicaid
State Balancing Incentive Program

Federally funded state

demonstration projects: Medicaid
matching funds for community
services and home-care assistance.

2. Access to Health Care

Polar

public and policymaker

viewpoints on entitlement to basic
health care: ensure access without
government interference with
private practice or consumer choice

Physicians as professionals obligated to

provide free care; versus
Medical care is neither a right nor a
privilege; it is a service available to
those wishing to purchase it.

ACA Provisions for Access

Address prior practice of shifting costs of uninsured to

paying patients

ACA mandate requires most Americans to

obtain insurance coverage with premium
subsidies for low income individuals and families
Extends Medicaid eligibility income limitations
On June 12, 2012, the Supreme Court ruled to
uphold the Affordable Care Act. The final Ruling
had a few implications ranging from ACA being
defined as a tax and not a mandate and a choice
for States to Opt-Out of Medicaid Expansion.

3. Quality of Care

Variations in quality and appropriateness

that impact costs recognized for decades
IOM reports and other leading studies

Medical errors are a leading cause of

preventable deaths
System complexity, diverse ownership,
opacity of quality measures and other
issues confound attempts at resolution

4. Conflicts of Interest

Entrepreneurship through physician

ownership/investment in clinical,
laboratory, imaging, rehabilitation and
other services creates potential for referral
bias.
Federal, state, AMA studies confirm bias with
physician-owned laboratories: more tests, higher
costs

MD relationships with pharmaceutical,

biologics and medical device companies
for product endorsements also viewed as
conflicts.

ACA Provisions on
Conflicts

Sunshine provisions require reports of all

financial transactions and transfers of value
between pharmaceutical/biologic products or
medical devices and physicians , hospitals
and other covered recipients reimbursed by
the federal government with up to $ 1M per
year company fines for non-compliance.
CMS posts information pertinent to
transactions in a searchable, downloadable
data base

Ethical Dilemmas
Issues arise from treatment options,
domains of law, politics, journalism,
administration, public, providers.
Issues expand with genetic advances, organ
transplantation, life-prolonging
technologies, genomic mapping.
Pluralistic, Judeo-Christian societal values
confound decision-making.

Continuing Challenges

ACA experiments with new models that test

strategies for:

Reducing costs, improving quality,

increasing access

Numerous issues persist for reform:

Improving health behaviors to attenuate risks
Involving consumers more effectively in health
care decisions
Balancing responsibility for policy changes
between government and the private sector

Affordable Care Act

What is the Affordable Care

Act?

The Patient Protection and Affordable Care

Act (PPACA) 2010 HR3590, or Affordable Care
Act (ACA) for short, is health care reform law
in America and is often called Obamacare.

The Patient Protection and Affordable Care

Act is
the Affordable Health Care for America Act,
the Patient Protection Act, and
the health care related sections of the Health Care
and Education Reconciliation Act and the Student
Aid and Fiscal Responsibility Act.

What is the Affordable Care Act

Do?
The Affordable Care Act attempts to reform the
healthcare system by:
providing more Americans with Affordable Quality
Health Insurance
by curbing the growth in healthcare spending in the
U.S..
Reforms include:
new benefits, rights and protections,
rules for Insurance Companies, taxes, tax breaks,
funding, spending,
the creation of committees, education, and new job
creation

5 ACA updates
you should know about from
the Public Health Newswire

1. The U.S. uninsured rate continues to fall

according to the latest Gallup poll, dropping to
13.4 percent in June. This constitutes the lowest
rate of uninsured Americans since the poll began
the tracking in 2008. The lowest rate previously
recorded was also in 2008, at 14.4 percent.
The rate has dropped 3.7 percentage points since
the end of 2013, and according to Gallup has
decreased sharply since the Affordable Care Acts
requirement for most Americans to have health
insurance went into effect at the beginning of
2014.

5 ACA updates
you should know about from
the Public Health Newswire

2. In 24 states that chose not to participate

in the ACAs Medicaid expansion 6.7
million residents will remain uninsured in
2016, according to the Robert Wood Johnson
Foundation.
The foundation also estimates that hospitals
in those states will lose a $167.8 billion boost
in Medicaid funding that was originally
intended to offset major cuts to their
Medicare and Medicaid reimbursement.

5 ACA updates
you should know about from
the Public Health Newswire
3. Health care plans offered through ACA
marketplaces, or exchanges, will see
premiums rise by an average of 7.5 percent
by 2015, according to a report by
PricewaterhouseCoopers.
The report also noted that insurers are likely
to raise their rates if their beneficiaries are
comprised of more sicker and elderly
Americans, while insurers with healthier
Americans are likely to lower their rates.

5 ACA updates
you should know about from
the Public Health Newswire

4. On July 1 the U.S. Supreme Court ruled in

Burwell v. Hobby Lobby Stores Inc. that
certain corporations can limit employee
access to key womens contraceptive
coverage.

5 ACA updates
you should know about from
the Public Health Newswire

5. On July 22 the U.S. Court of Appeals for the D.C.

Circuit ruled to weaken federal funding mandated
by the ACA, raising costs for millions of Americans
who have gained health insurance since October
1, 2013. Hours later, the Fourth Circuit Court of
Appeals, in Richmond, Virginia, ruled the opposite.
The rulings will not immediately affect 4.7 million
Americans who gained coverage through the
federal marketplace, housed online at
Healthcare.gov, but the conflicting opinions will
likely be settled in the Supreme Court.

To be continued.
Because of the many different initiatives
included in the ACA, there will continue to
be changes in the implementation of these
activities.
Health Reform Quiz

Because it is a whole new world!