Health Care Policy in a Health Care Policy in a NutshellNutshell

Health Care Policy in a Health Care Policy in a NutshellNutshell

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Welcome!Welcome!Welcome!Welcome!

Our one-hour session today will cover Health Care Policy, including:

Background and History of Health Policy

Cost, Access, and Quality

Proposed Solutions2

Background and History of Background and History of Health PolicyHealth PolicyBackground and History of Background and History of Health PolicyHealth Policy

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History of Health System and History of Health System and PolicyPolicyHistory of Health System and History of Health System and PolicyPolicy

Transformation of hospitals and the role of physicians

The role of government

• Presidents Teddy Roosevelt, Truman, Clinton and Obama

• Medicare and Medicaid

• HMO Act of 1973 - Nixon

• 1997-SCHIP

• 2010 Health Care Reform4

History of Health System and History of Health System and PolicyPolicyHistory of Health System and History of Health System and PolicyPolicy

Employers

World War II

Health Insurers

1847-First comprehensive group policy offered by Massachusetts Health Insurance of Boston.

1929 First Blue Cross Plan

Managed Care – Mid-1990’s

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Who are the Stakeholders?Who are the Stakeholders?Who are the Stakeholders?Who are the Stakeholders?

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Who Pays What?Who Pays What?Who Pays What?Who Pays What?

Hospital Payment/Cost Ratios

Private Payers - 110% to 130%

Medicare – 92% - 102%

Medicaid – 80% - 95%

Private payers pay higher reimbursement rates to physiciansSource: Feldstein

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Health Care System DynamicsHealth Care System DynamicsHealth Care System DynamicsHealth Care System Dynamics

DRG payment system

Managed Care

• Provider Response• Consumer Response

Accountable Care Organizations, Shared Savings and Patient Centered Medical Homes

• Provider Response• Payer Response

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The Iron Triangle of Health Care The Iron Triangle of Health Care PolicyPolicyThe Iron Triangle of Health Care The Iron Triangle of Health Care PolicyPolicy

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Health Care CostHealth Care CostHealth Care CostHealth Care Cost10

2012 National 2012 National Health Care Expenditure DataHealth Care Expenditure Data2012 National 2012 National Health Care Expenditure DataHealth Care Expenditure Data

Total Health Care Expenditures $2.823 Trillion

Hospital Care $873.1 Billion (31%)

Physician $542.9 Billion (19.2%)

Prescription Drugs $290.2 Billion (10.3%)

Source: CMS https://www.cms.gov/NationalHealthExpendData/downloads/tables.pdf 11

Total Health Expenditure per Total Health Expenditure per Capita, Capita, U.S. and Selected CountriesU.S. and Selected Countries

Total Health Expenditure per Total Health Expenditure per Capita, Capita, U.S. and Selected CountriesU.S. and Selected Countries

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What are the cost drivers?What are the cost drivers?What are the cost drivers?What are the cost drivers?

Medical Technology

Payment structure (fee for service)

Fraud, waste and abuse

Tax incentives

Tort liability

Lifestyle13

Health Care Costs and FloridaHealth Care Costs and FloridaHealth Care Costs and FloridaHealth Care Costs and Florida

• $132 billion in state health expenditures in 2009

• $23 billion on Medicaid (including federal share)

• Medicaid Reform

• Medicaid Expansion

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Medical Treatment vs. Medical Treatment vs. PreventionPreventionMedical Treatment vs. Medical Treatment vs. PreventionPrevention

Intervention Number of Lives Saved per 1,000 Additional

Participants

Cost per Life Saved

NICU’s 2.8 $4,778Prenatal Care 4.5 $39

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Health Care AccessHealth Care AccessHealth Care AccessHealth Care Access16

Two Major FactorsTwo Major FactorsTwo Major FactorsTwo Major Factors

Ability to pay

Labor supply versus demand

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Ability to PayAbility to PayAbility to PayAbility to Pay

Approximately 16.3% of Americans are uninsured.

Approximately 21% of Floridians are uninsured.

Education, jobs and health insurance

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Expanding Coverage Through the Expanding Coverage Through the ACA?ACA?Expanding Coverage Through the Expanding Coverage Through the ACA?ACA?

Medicaid and Subsidies

Polarized political climate

State and federal budget concerns

Lingering legal issue regarding federal exchanges

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Supply of Primary Care Supply of Primary Care PhysiciansPhysiciansSupply of Primary Care Supply of Primary Care PhysiciansPhysicians

2007 survey showed that only 7% of medical students planned to go into primary care.

In Florida, 37% of non-federal physicians practice primary care, compared to 39% throughout the United States.

15.1% of Floridians are underserved compared to 11.4% nationwide.

Source: Kaiser Family Foundation 20

Outlook for Physician DemandOutlook for Physician DemandOutlook for Physician DemandOutlook for Physician Demand

Population growth

Aging population

Per capita income increasing, so use of physicians are increasing

More technology

Increased use of lab tests and imaging services

Calls for more medical schools 21

Outlook for Physician SupplyOutlook for Physician SupplyOutlook for Physician SupplyOutlook for Physician Supply

Decreased work effort expected

Advanced Non-Physician Practitioners

Aging physicians: 61% are 45 or older

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QUALITYQUALITYQUALITYQUALITY

Health Care QualityHealth Care QualityHealth Care QualityHealth Care Quality

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Definition of QualityDefinition of QualityDefinition of QualityDefinition of Quality

“The degree to which health services for individuals and populations increase the likelihood of desired health outcomes and are consistent with current professional knowledge.”

Source: IOM

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Quality: Quality: Who measures it and Who measures it and how?how?Quality: Quality: Who measures it and Who measures it and how?how?

Service quality

Clinical quality

• Process

• Outcomes25

OpportunitiesOpportunitiesOpportunitiesOpportunities

Americans receive evidence based care 55% of the time

Medical errors cost the health care system $17.1 billion nationally

Death rates from cancer, heart disease and stroke are higher among ethnic minorities in Florida

Defensive medicine

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Health Care ProposalsHealth Care ProposalsHealth Care ProposalsHealth Care Proposals27

ThemesThemesThemesThemes

Cover the uninsured

Improve quality while increasing efficiency within the delivery system

Wellness and prevention

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High Level ACA IssuesHigh Level ACA IssuesHigh Level ACA IssuesHigh Level ACA Issues

Expansion of coverage through Medicaid and subsidies

Health insurance market reforms and exchanges

Quality demonstration projects

Public health initiatives

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ProposalsProposalsProposalsProposals

Universal coverage (various varieties)

Aggressive outreach to those that are currently eligible for public programs but are not enrolled

Sustainable public programs

Bolster primary care workforce 30

ProposalsProposalsProposalsProposals

Robust health information network

Comparative effectiveness research

Collaboration among patients, providers and payers

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ProposalsProposalsProposalsProposals

Allow for creative and iteratively innovative approaches to the coordination and delivery of services that focuses on the patient and increases quality and efficiency

Efforts to address health care disparities and health literacy

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ProposalsProposalsProposalsProposals

Maintaining healthy competition within the delivery system

Maximize efforts to reduce fraud, waste and abuse in the health care system

• Tort reform

• Greater investment in law enforcement

• Use HIT to eliminate duplication and other waste

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ProposalsProposalsProposalsProposals

Adequately fund safety net programs to expand coverage to vulnerable populations, that is fiscally sustainable

Encourage worksite wellness programs

Strategically craft public health initiatives that will have the largest impact

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Grow, Pay or Cut? Economic Grow, Pay or Cut? Economic ConstraintsConstraintsGrow, Pay or Cut? Economic Grow, Pay or Cut? Economic ConstraintsConstraints

Medicare

Gross Domestic Product

Federal Taxes

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Unauthorized EntitiesUnauthorized EntitiesUnauthorized EntitiesUnauthorized Entities

An entity that is required to be licensed or registered with the Florida Office of Insurance Regulation but is operating without the proper authorization is identified as an unauthorized insurer.  All persons have the responsibility of conducting reasonable research to ensure they are not writing policies or placing business with an unauthorized insurer. 

Any person who, directly or indirectly, aids or represents an unauthorized insurer can lose their licenses or face other disciplinary sanctions. Please see section 626.901, Florida Statutes, to read the laws.  Lack of careful screening can result in significant financial loss to Florida consumers due to unpaid claims and/or theft of premiums.  Under Florida law, a person can be charged with a third-degree felony and also held liable for any unpaid claims and refund of premiums when representing an unauthorized insurer.  It is the person’s responsibility to give fair and accurate information regarding the companies they represent.

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