Assessment Context- Health Care Economics: An Industry Overview
Providers and consumers of health care services have experienced significant changes following the enactment of the Patient Protection and Affordable Care Act of 2010 (Affordable Care Act). New terminology, concepts, methods of valuation, reimbursement, and decisions accompanied this landmark legislative change. Health care leaders are responsible for maintaining the financial viability of their organizations, aligning with both the organizational mission statement and directional strategy, and allocating finite resources. This task has become increasingly complex due in part to changes associated with the Affordable Care Act.
Conditions of participation in state- and federally-funded health care programs have generated new requirements, and some represent major challenges with respect to implementation and compliance. An example of this can be seen with the electronic medical records initiative, which has been an ongoing challenge. Leaders must grapple with questions such as:
• What is the actual cost to the organization?
• Are there funding shortfalls for full implementation?
• Are there unexpected additional costs that result from existing software incompatibilities?
• Are there additional security measures to ensure HIPAA compliance, such as staff training?
• What about patient satisfaction scores and how these can affect reimbursement?
The role of the health care executive in exercising sound economic decision making has become increasingly challenging, especially when one considers the potential adverse financial and operational consequences, or civil and criminal penalties, that can result from oversights or errors. Health care executives serve in a fiduciary role within their organizations and communities. To this end, it is helpful for leaders to understand applicable laws that drive economic decision making and its accepted tools from authoritative sources, industry standards, and risk management.
The Provider Organization
How have recent changes in health care affected your current or future desired role within the industry? Do you recognize new concepts and terminology emerging with our changing health care system? To illustrate this point, consider your familiarity with the following economic concepts and their associated implications for providers: accountable care organizations, Readmissions Reduction Program, HCAHPS scores, HAC Reduction Program, never events, value based purchasing, open payments public data, cost shifting, risk sharing, and medical capital equipment (lease versus purchase). These are just a few examples of facets that involve financial, and thus economic, decision making.
It is important to maintain the environmental, larger perspective and to understand what resources are available from the government for economic problem solving and decision making. It is also important to maintain "bifocal vision" as you consider demand, supply, and finite human and financial organizational resources.
As a health care leader you will be challenged to maintain organizational financial viability and to participate in team-based decision making. A few examples of critical economic decision-making topics are the acquisition of necessary capital medical equipment, adjustment of clinical staffing ratios, funding unexpected implementation and maintenance costs of electronic medical records (EMRs), and funding under- and uninsured patient care.
Health Care Supply and Demand
Economics in health care can vary from the typical dynamics of other industries. The rules of supply and demand are influenced in unique ways. Examples of this can be seen in the fact that physicians can both supply services as well as control demand for health care services. Additionally, consumers of health care services can have a need or demand for services, but may not be able to access supply or available care due to geography or financial constraints (such as a high insurance deductible).
Suppliers or providers of care can deliver a service and not be reimbursed for the service by the consumer if various quality and satisfaction standards are not met. Government regulations can also impact reimbursement. An example of this can be observed in a problematic readmission within 30 days of a patient's discharge from a hospital. If the readmission meets criteria for being preventable, the provider may not be reimbursed for services, nor may the provider bill the patient for services already consumed
Guiding Questions
Executive Brief: Proposal of New Economic Opportunity
This document is designed to give you questions to consider and additional guidance to help you successfully complete the Executive Brief: Proposal of a New Economic Opportunity assignment. You may find it useful to use this document as a pre-writing exercise or as a final check to ensure that you have sufficiently addressed all the grading criteria for this assignment. This document is a resource to help you complete the assignment. Do not turn in this document as your assignment submission.
Propose an economic initiative that presents an opportunity for your care setting at both the micro (departmental, neighborhood) and macro (organizational, community) levels, and that you believe will provide ethical and culturally equitable improvements to the quality of care.
Note: While your proposal should seek to affect the economics of your care setting at both a micro and a macro level, it will likely only be maintained at one level once it is implemented. For example, adding a new advanced imaging service may add economic benefit for the unit that houses it and the overall revenue of the organization. However, the actual imaging unit will be maintained at the micro, or departmental, level.
• Did you describe the service line or economic initiative that you are proposing?
• Did you explain why your proposal presents an economic opportunity at the micro level (such as the departmental level)?
• Did you explain why your proposal presents an economic opportunity at the macro level (such as the organizational or community level)?
• Did you explain how your proposed initiative is ethical and culturally equitable?
• Did you explain how or why this economic initiative will result in improvements in the quality of care?
Analyze the supply and demand for your proposed economic initiative within contexts relevant to your care setting.
• What do the economic and demographic data suggest is supply for your proposed initiative in the surrounding environment?
• What do the economic and demographic data suggest is the demand for your proposed initiative in the surrounding environment?
Explain relevant economic and environmental data that support your proposal and analysis.
• How does the relevant economic data (sector growth, supply versus demand, cost versus reimbursement, et cetera) illustrate a potential opportunity for your care setting related to your proposal?
• How does this data illustrate the potential economic viability of your proposed initiative?
Communicate your economic proposal in a logically structured and concise manner, writing content clearly with correct use of grammar, punctuation, and spelling.
• Is your executive summary logically structured?
• Is your executive summary 2-4 double-spaced pages?
• Is your writing clear and free from errors?
Effectively support your proposal with relevant economic data and scholarly sources, correctly formatting citations and references using current APA style.
• Did you cite 3-5 sources that provided economic, environmental, or scholarly support of your proposal and analysis?
o Did you use a combination of quantitative and qualitative evidence?
• Did you format your citations according to current APA style?
Attachment:- Overview-Assessment-Course.rar