Unit 8
Business of Caring
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Chapter 22
Controlling Health Care Costs
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Paying for Health Care
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Rising costs
Need to control costs
Fee-for-service
Premiums
New ways of paying for health care
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Managed Care
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Specific built-in cost controls
Profit
Prepaid plans
Negotiated fees
Limitation of access
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Question
• True or False:
– Health care costs are evenly distributed among
all patients.
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duplicated, or posted to a publicly accessible website, in whole or in part.
Answer
• False
• About 10 percent of patients incur 80
percent of costs
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duplicated, or posted to a publicly accessible website, in whole or in part.
Managed Care Systems
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Health maintenance organization (HMO)
Exclusive provider organization (EPO)
Preferred provider organization (PPO)
Point-of-service plan (POS)
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Restriction of Usage
• Primary care providers (PCP)
• Gatekeepers
• Preauthorization
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Question
• Which of the following managed care
systems allows patients to receive services
from participating or nonparticipating
providers?
A. POS
B. PPO
C. HMO
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duplicated, or posted to a publicly accessible website, in whole or in part.
Answer
• A. POS
• POS plan allows patients to receive
services from participating or
nonparticipating providers
• PPOs and HMOs do not allow this flexibility
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duplicated, or posted to a publicly accessible website, in whole or in part.
Government Programs
• Medicare
– Part A
– Part B
– Part C
– Part D
• Deductible
• Coinsurance
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Government Programs
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Medicaid
Diagnostic related groups (DRGs)
Reimbursement
Minimum standards of care
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Question
• Which part of Medicare coverage would
pay for hospitalizations?
A. Part A
B. Part B
C. Part D
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duplicated, or posted to a publicly accessible website, in whole or in part.
Answer
• A. Part A
• Medicare Part A
– Helps pay for inpatient care
• Medicare Part B
– Helps pay for outpatient services
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duplicated, or posted to a publicly accessible website, in whole or in part.
Answer
• A. Part A
• Medicare Part D
– Helps pay for medications prescribed for
treatment
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Controlling Organizational Costs
• Resources required:
– Financing
– Technology and supplies
– Facilities
– Personnel
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Resources Required
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Costs
• Account receivable
• Account payable
• Cost of money
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duplicated, or posted to a publicly accessible website, in whole or in part.
Question
• What would it be called when a hospital
owes money to a supplier?
A. Accounts receivable
B. Accounts payable
C. Cost of money
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duplicated, or posted to a publicly accessible website, in whole or in part.
Answer
• B. Accounts payable
• Account payable
– When money owed to others for services,
supplies, or equipment received
• Account receivable
– When services have been given and payment
not received
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duplicated, or posted to a publicly accessible website, in whole or in part.
Answer
• B. Accounts payable
• Cost of money
– Amount that could be earned on money owed if
invested
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Impacting Costs
• Ask:
– How can I help reduce unnecessary costs?
• Strive for personal efficiency
• Focus on job
• Be careful with use of supplies and
equipment
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Impacting Costs
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Bill and code correctly
Maintain inventory
Educate patients
Be willing to cross-train
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Personal Efficiency
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Use problem-solving process
Assume responsibility
Avoid just letting life pass you by
Avoid becoming sidetracked
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Personal Efficiency
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Expect setbacks
Eliminate unimportant time wasters
Communicate clearly and honestly
Look at your life as a whole
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Question
• True or False:
– The individual health care professional has an
impact on the efficiency of the health care
facility.
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duplicated, or posted to a publicly accessible website, in whole or in part.
Answer
• True
• Each health care professional impacts
efficiency of health care facility
– Can be negative or positive
• Depends on personal efficiency of person
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Acting with Thought
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What are the facts?
What is the best course of action?
What is the right thing to do?
What is the probable impact of my actions?
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