Managed Care & Health Care Reform

Cost of Health Care

$1.03 trillion in 1997

15% of GNP

4%-5% annual increase in health care spending

Division of Health Care Costs

Hospital care 34%

Physician care 20%– Together make up 54% of health care costs

Home Health care 3%

Public Health 3%

Research 3%

The Uninsured

43.6 million in 2002

15.2% of population

1 in 7 uninsured

Characteristics of the Uninsured

Born in America 12.8%

Naturalized citizen 17.5%

Not a citizen 43.3%

Blacks 16.9%

Hispanic 23.4%

White 54.3%

Other 5.4%

Household Income for Uninsured

Under $25,000 23.5%

$25,000 - $49,000 19.3 %

$50,000 – 74,999 11.8%

$75,000 & over 8.2%

Education of Uninsured

No high school 28.0%

High school graduate 18.8%

Some college, no degree 15.0%

Associate degree 12.1%

Bachelor’s degree & higher 8.4%

Employment

Private sector 60.2%

Self-employed 12.7%

Public sector 5.5%

Unemployed 21.6%

Health of Uninsured

No use of preventive health care

Seek treatment when illness more advanced

Receive inadequate care

Higher morbidity and mortality rates

Response of US Government to Health Care Crisis

Retrospective payment system

Reimbursement per unit of service

Prospective payment system

Reimbursement based on average value of service

Managed Care Plans

Characteristics

Prepaid health insurance plans

Health care providers accept lower payments

Gatekeepers to health care services

Positive Influence of Managed Care Plans

Expanded role for nurses

Increased emphasis on health promotion & disease prevention

Negative Influences of Managed Care Plans

Built incentive to limit referrals to specialists

Physicians leaving medicine

Most are for profit organizations

Limited ability to sue managed care organizations

Employment Retirement Income Security Act (ERISA) 1974

Protects employer-sponsored pensions from litigation (HMO’S)

Racketeering Influence and Corrupt Organizations Act

Health Insurance Accountability Act

Ensures can change jobs without losing health insurance coverage

Guarantees coverage for small companies & self-employed individuals

Provides new benefits for self-employed

Consolidated Omnibus Budget Reconciliation Act (COBRA) 1986

Provides insurance when unemployed

Event Beneficiary CoverageTermination or Employee, 18 monthsReduced hrs.Spouse, child

Divorce or Spouse, child36 monthsseparation

Health Care Options

Maintain current Managed Care Plan option

  Create National Health Insurance Plan (one-payer system or Universal Health Care)

Managed Competition