In the United States,Medicaid is a government program that provides health insurance for adults and children with limited income and resources. The program is partially funded and primarily managed by state governments,which also have wide latitude in determining eligibility and benefits,but the federal government sets baseline standards for state Medicaid programs and provides a significant portion of their funding.
Medicare is a federal health insurance program in the United States for people age 65 or older and younger people with disabilities,including those with end stage renal disease and amyotrophic lateral sclerosis. It was begun in 1965 under the Social Security Administration and is now administered by the Centers for Medicare and Medicaid Services (CMS).
Diagnosis-related group (DRG) is a system to classify hospital cases into one of originally 467 groups,with the last group being "Ungroupable". This system of classification was developed as a collaborative project by Robert B Fetter,PhD,of the Yale School of Management,and John D. Thompson,MPH,of the Yale School of Public Health. The system is also referred to as "the DRGs",and its intent was to identify the "products" that a hospital provides. One example of a "product" is an appendectomy. The system was developed in anticipation of convincing Congress to use it for reimbursement,to replace "cost based" reimbursement that had been used up to that point. DRGs are assigned by a "grouper" program based on ICD diagnoses,procedures,age,sex,discharge status,and the presence of complications or comorbidities. DRGs have been used in the US since 1982 to determine how much Medicare pays the hospital for each "product",since patients within each category are clinically similar and are expected to use the same level of hospital resources. DRGs may be further grouped into Major Diagnostic Categories (MDCs). DRGs are also standard practice for establishing reimbursements for other Medicare related reimbursements such as to home healthcare providers.
Prescription drug list prices in the United States continually are among the highest in the world. The high cost of prescription drugs became a major topic of discussion in the 21st century,leading up to the American health care reform debate of 2009,and received renewed attention in 2015. One major reason for high prescription drug prices in the United States relative to other countries is the inability of government-granted monopolies in the American health care sector to use their bargaining power to negotiate lower prices,and the American payer ends up subsidizing the world's R&D spending on drugs.
Medicare Part D,also called the Medicare prescription drug benefit,is an optional United States federal-government program to help Medicare beneficiaries pay for self-administered prescription drugs. Part D was enacted as part of the Medicare Modernization Act of 2003 and went into effect on January 1,2006. Under the program,drug benefits are provided by private insurance plans that receive premiums from both enrollees and the government. Part D plans typically pay most of the cost for prescriptions filled by their enrollees. However,plans are later reimbursed for much of this cost through rebates paid by manufacturers and pharmacies.
In the healthcare industry,pay for performance (P4P),also known as "value-based purchasing",is a payment model that offers financial incentives to physicians,hospitals,medical groups,and other healthcare providers for meeting certain performance measures. Clinical outcomes,such as longer survival,are difficult to measure,so pay for performance systems usually evaluate process quality and efficiency,such as measuring blood pressure,lowering blood pressure,or counseling patients to stop smoking. This model also penalizes health care providers for poor outcomes,medical errors,or increased costs. Integrated delivery systems where insurers and providers share in the cost are intended to help align incentives for value-based care.
The United States government provides funding to hospitals that treat indigent patients through the Disproportionate Share Hospital (DSH) programs,under which facilities are able to receive at least partial compensation.
Pharmaceutical policy is a branch of health policy that deals with the development,provision and use of medications within a health care system. It embraces drugs,biologics,vaccines and natural health products.
Medicare Advantage is a type of health plan offered by Medicare-approved private companies that must follow rules set by Medicare. Most Medicare Advantage Plans include drug coverage. Under Part C,Medicare pays a sponsor a fixed payment. The sponsor then pays for the health care expenses of enrollees. Sponsors are allowed to vary the benefits from those provided by Medicare's Parts A and B as long as they provide the actuarial equivalent of those programs. The sponsors vary from primarily integrated health delivery systems to unions to other types of non profit charities to insurance companies.
Healthcare reform in the United States has had a long history. Reforms have often been proposed but have rarely been accomplished. In 2010,landmark reform was passed through two federal statutes:the Patient Protection and Affordable Care Act (PPACA),signed March 23,2010,and the Health Care and Education Reconciliation Act of 2010,which amended the PPACA and became law on March 30,2010.
A rural health clinic (RHC) is a clinic located in a rural,medically under-served area in the United States that has a separate reimbursement structure from the standard medical office under the Medicare and Medicaid programs. RHCs were established by the Rural Health Clinic Services Act of 1977,. The RHC program increases access to health care in rural areas by
- creating special reimbursement mechanisms that allow clinicians to practice in rural,under-served areas
- increasing utilization of physician assistants (PA) and nurse practitioners (NP)
A long-term acute care hospital (LTACH),also known as a long-term care hospital (LTCH),is a hospital specializing in treating patients requiring extended hospitalization. Hospitals specializing in long-term care have existed for decades in the form of sanatoriums for patients with tuberculosis and other chronic diseases. The modern hospital known as an LTACH came into existence as a result of the Medicare,Medicaid,and SCHIP Balanced Budget Refinement Act of 1999. The Act defines an LTACH as “a hospital which has an average inpatient length of stay of greater than 25 days.”Traditionally,LTACHs provide care for patients receiving prolonged mechanical ventilation.
Bundled payment is the reimbursement of health care providers "on the basis of expected costs for clinically-defined episodes of care." It has been described as "a middle ground" between fee-for-service reimbursement and capitation,given that risk is shared between payer and provider. Bundled payments have been proposed in the health care reform debate in the United States as a strategy for reducing health care costs,especially during the Obama administration (2009–2016). Commercial payers have shown interest in bundled payments in order to reduce costs. In 2012,it was estimated that approximately one-third of the United States healthcare reimbursement used bundled methodology.
An accountable care organization (ACO) is a healthcare organization that ties provider reimbursements to quality metrics and reductions in the cost of care. ACOs in the United States are formed from a group of coordinated health-care practitioners. They use alternative payment models,normally,capitation. The organization is accountable to patients and third-party payers for the quality,appropriateness and efficiency of the health care provided. According to the Centers for Medicare and Medicaid Services,an ACO is "an organization of health care practitioners that agrees to be accountable for the quality,cost,and overall care of Medicare beneficiaries who are enrolled in the traditional fee-for-service program who are assigned to it".
A prospective payment system (PPS) is a term used to refer to several payment methodologies for which means of determining insurance reimbursement is based on a predetermined payment regardless of the intensity of the actual service provided.
The 340B Drug Pricing Program is a US federal government program created in 1992 that requires drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at significantly reduced prices. The intent of the program is to allow covered entities to "stretch scarce federal resources as far as possible,reaching more eligible patients and providing more comprehensive services." Maintaining services and lowering medication costs for patients is consistent with the purpose of the program,which is named for the section authorizing it in the Public Health Service Act (PHSA) It was enacted by Congress as part of a larger bill signed into law by President George H. W. Bush.
Specialty drugs or specialty pharmaceuticals are a recent designation of pharmaceuticals classified as high-cost,high complexity and/or high touch. Specialty drugs are often biologics—"drugs derived from living cells" that are injectable or infused. They are used to treat complex or rare chronic conditions such as cancer,rheumatoid arthritis,hemophilia,H.I.V. psoriasis,inflammatory bowel disease and hepatitis C. In 1990 there were 10 specialty drugs on the market,around five years later nearly 30,by 2008 200,and by 2015 300.
A safety net hospital is a type of medical center in the United States that by legal obligation or mission provides healthcare for individuals regardless of their insurance status or ability to pay. This legal mandate forces safety net hospitals (SNHs) to serve all populations. Such hospitals typically serve a proportionately higher number of uninsured,Medicaid,Medicare,Children's Health Insurance Program (CHiP),low-income,and other vulnerable individuals than their "non-safety net hospital" counterpart. Safety net hospitals are not defined by their ownership terms;they can be either publicly or privately owned. The mission of safety net hospitals is rather to provide the best possible care for those who are barred from health care due to the various possible adverse circumstances. These circumstances mostly revolve around problems with financial payments,insurance plans,or health conditions. Safety net hospitals are known for maintaining an open-door policy for their services.
Health care efficiency is a comparison of delivery system outputs,such as physician visits,relative value units,or health outcomes,with inputs like cost,time,or material. Efficiency can be reported then as a ratio of outputs to inputs or a comparison to optimal productivity using stochastic frontier analysis or data envelopment analysis. An alternative approach is to look at latency times and delay times between a care order and completion of work,and stated accomplishment in relation to estimated effort.
Yuting Zhang is a professor of health economics at the University of Melbourne,and an expert on economic evaluations of health policy and healthcare reforms. She is a journal editor,award recipient,and has written numerous articles in influential journals in her field.
