Health Reform Strategies Flashcards
(20 cards)
Supply Side Controls (definition)
Aim to constrain provider behavior in supplying health care services.
-Physicians order and perform health care services, driving demand. Physician-induced demand leads to overutilization of health care services, which drives up costs at the expense of quality and access.
Supply Side Control Examples
- Provider networks
- Utilization Review
- PCP Management
- Capitation
- Value-based purchasing (pay for performance)
Provider Networks (supply side control)
Virtually all Managed Care Organizations (MCOs) either:
- Limit their members to a particular network of providers, or;
- Impose financial disincentives to discourage their members from “going out of network”.
Utilization review (supply side control)
A process that evaluates the necessity, appropriateness, and efficiency of medical treatments, procedures, and services
-Evidence-based clinical guidelines: provide significant guidance as to whether a particular treatment is appropriate.
PCP management (supply side control)
Some forms of utilization review relies on primary care physicians (PCPs) to act as case managers and gatekeepers for access to specialists, insurance coverage, and more intensive medical services.
Capitation (supply side control)
A payment model that pays providers a lump sum for caring for MCO-enrolled patients over the course of a set period of time. Typically, payments are made per member per month.
-Providers assume financial risk from the MCO; if the costs of care for the members exceed the capitation payment, then the providers make money.
Demand Side Controls:
-Aim to reduce the demand for health care services by changing the incentives for health care consumers (i.e. patients).
Seeks to curb costs at the point of purchase of health care products and services by increasing the amount the patient must pay out-of-pocket.
-Gives patients “skin in the game”, sensitizes patients to their health care costs.
Demand Side Controls Examples
- Cost sharing
- High deductible health plans with a savings option (HDHP/SOs)
- Shared decision making:
Cost Sharing (demand side control)
Deductibles, coinsurance, and copayments.
HDHP/SOs (demand side control)
-Pair a high deductible health plan with a Health Savings Account (HSA) or a Health Reimbursement Arrangement (HRA).
-HSAs/HRAs carry over funds from year to year, as opposed to “flexible spending accounts (FSAs)” which have a “use it or lose it” at the end of the year policy.
-Aim to limit health care demand by making patients more responsible for their health care spending.
Shared decision making (demand side control)
-Physician shares w/ patient all relevant risk and benefit info on all treatment alternatives, and patient shares w/ physician all relevant personal information that might make one treatment more or less tolerable than another. Physician and patient then use this info to come to a joint treatment decision.
-Very different demand side control than the others, because this seeks to limit demand side controls through information sharing and quality, rather than through financial incentives/disincentives.
Guaranteed issue:
A “guaranteed issue clause” requires insurance companies to offer health insurance to all individuals regardless of their pre-existing conditions.
-While guaranteed issue only requires an insurance company to offer coverage to an individual, it does not limit how much the insurer can charge for coverage.
Community rating:
-Requires an insurance company to charge all members of a community the same premium within a plan.
-A method by which insurance companies set premiums and subscribers pay all the same premium.
Experience rating:
A different type of rating; a method by which insurance companies use the past experience of the group to be insured to determine the premium.
Insurance enrollment mandates:
Requiring all people to maintain health insurance coverage, either through an individual mandate or an employer mandate.
Tax benefits:
Offering tax credits/income tax exclusions for enrolled individuals.
Public insurance:
-Medicaid/Medicare expansion, or offering new public insurance programs.
-Affordable Care Act (ACA): states can expand Medicaid to cover people at 138% of poverty line.
Government efforts to improve access Examples
- Guaranteed Issue
- Community Rating (experience rating too)
- Individual enrollment mandates
- Tax benefits
- Public insurance
Price Regulation & other measures examples
- Price transparency
- Price caps
- Rate settings
- Prohibitions on nondisclosure (gag) clauses & most favorite nation clauses
Most Favored Nations Clauses (MFNs)
-In contracts between health care providers and insurers. It guarantees that the provider organization will not offer any other insurer a better rate for health care services.
-Leads to higher premiums for the plans of the contracting insurance company, but also all other plans in the contract with that “must have provider”.
