Health Care Delivery in the United States

Chapter 13

Health Care Delivery in the United States

Chapter Objectives (1 of 3)

After studying this chapter, you will be able to:

Define the term healthcare system.

Trace the history of healthcare delivery in the United States from colonial times to the present.

Discuss and explain the concept of the spectrum of healthcare delivery.

Distinguish between the different kinds of health care, including population-based public health practice, medical practice, long-term practice, and end-of-life practice.

List and describe the different levels of medical practice.

List and characterize the various groups of healthcare providers.

Explain the differences among allopathic, osteopathic, and nonallopathic providers.

Define complementary and alternative medicine.

Explain why there is a need for healthcare providers.

Prepare a list of the different types of facilities in which health care is delivered.

Chapter Objectives (2 of 3)

Explain the differences among private, public, and voluntary hospitals.

Explain the difference between inpatient and outpatient care facilities.

Briefly discuss the options for long-term care.

Explain what the Joint Commission does.

Identify the major concerns with the healthcare system in the United States.

Explain the various means of reimbursing healthcare providers.

Briefly describe the purpose and concept of insurance.

Define the term insurance policy.

Explain the insurance policy terms deductible, co-insurance, copayment, fixed indemnity, exclusion, and pre-existing condition.

Explain what is meant when a company or business is said to be self-insured.

Chapter Objectives (3 of 3)

List the different types of medical care usually covered in a health insurance policy.

Briefly describe Medicare, Medicaid, and Medigap insurance.

Briefly describe the Children’s Health Insurance Program (CHIP).

Briefly explain long-term care health insurance.

Define managed care.

Define the terms health maintenance organization (HMO), preferred provider organization (PPO), and point-of-service option.

Identify the advantages and disadvantages of managed care.

Define consumer-directed health plans and give several examples.

Provide a brief overview of the Affordable Care Act passed in 2010.

Summarize the three cases that have been heard by the U.S. Supreme Court that have had an impact on the Affordable Care Act.


Healthcare delivery in U.S. is unlike other developed countries

Delivered by an array of providers in a variety of settings

Paid for in a variety of ways

Is U.S. health care a “system?”

History of Healthcare Delivery in the U.S. (1 of 2)

Self-care has been a category of health care throughout history and today

From colonial times through late 1800s, anyone trained or untrained could practice medicine

Past medical education not as rigorous as today

Early medical education not grounded in science; experience-based only, prior to 1870

History of Healthcare Delivery in the U.S. (2 of 2)

Most care was provided in patients’ homes

Hospitals only in large cities and seaports

Functioned more in a social welfare manner

Not clean; unhygienic practice



Healthcare Delivery in the Late 1800s – Early 1900s (1 of 2)

Care moved from patient’s home to physician’s office and hospital

Building and staffing better; designed for patient care; trained people; medical supplies

Reduced travel time

Science had bigger role in medical education

Mortality decline due to improved public health measures

Healthcare Delivery in the Late 1800s – Early 1900s (2 of 2)

Early 1920s: chronic diseases passed communicable as leading causes of death

New procedures: X-ray, specialized surgery, chemotherapy, ECG

Training: doctors and nurses more specialized

1929 – 3.9% GDP on health care

Two-party system – patients and physicians

Physicians collected own bills, set and adjusted prices based on ability to pay

Healthcare Delivery – 1940s and 1950s

WWII impact

Due to wage restrictions, employers used health insurance to lure workers

Huge technical strides in 1940s and 1950s

Hill-Burton Act

Improved procedures, equipment, facilities meant rise in cost of health care

Concept of health care as basic right vs. privilege

Healthcare Delivery – 1960s

Late 1950s had overall shortage of quality care and maldistribution of healthcare services

Increased interest in health insurance

Third-party payment system became standard method of payment

Cost of health care rose

Increased access, little expense for those with insurance; those without unable to afford care

1965: Medicare and Medicaid

Healthcare Delivery – 1970s

Health Maintenance Organization Act of 1973

National Health Planning and Resources Development Act of 1974

Health Systems Agencies in place to cut costs and prevent building unnecessary facilities and purchasing unnecessary equipment

Healthcare Delivery – 1980s

Deregulation of healthcare delivery

Role of competition

Competitive market approach of questionable value in lowering healthcare costs

Proliferation of new medical technology

Elaborate health insurance programs

Healthcare Delivery – 1990s

American Health Security Act of 1993

Managed care

Achieve efficiency

Control utilization

Determine prices and payment

Mid-1990s – percentage of GDP and dollars spent on health care continued to increase


Healthcare Delivery in the 21st Century

Medicare Prescription Drug, Improvement, and Modernization Act of 2003

The World Health Report 2000 – Health Systems: Improving Performance

U.S. ranked 37 out of 191 countries

CHIP Reauthorization Act of 2009

Affordable Care Act of 2010

Healthcare System: Structure

Spectrum of healthcare delivery

Various types of care

Types of healthcare providers

Healthcare facilities in which health care is delivered

Spectrum of Healthcare Delivery

Population-based public health practice

Medical practice

Long-term practice

End-of-life practice

Public Health Practice

Interventions aimed at disease prevention and health promotion, specific protection, and case findings

Health education

Empowerment and motivation

Much takes place in governmental health agencies

Also occurs in a variety of other settings

Medical Practice

Primary medical care

Clinical preventive services; first-contact treatment; ongoing care for common conditions

Secondary medical care

Specialized attention and ongoing management

Tertiary medical care

Highly specialized and technologically sophisticated medical and surgical care

For unusual and complex conditions

Long-Term Practice

Restorative care

Provided after surgery or other treatment

Rehab care, therapy, home care

Inpatient and outpatient units, nursing homes, other settings

Long-term care

Help with chronic illnesses and disabilities

Time-intensive skilled care to basic daily tasks

Nursing homes and various settings

End-of-Life Practice

Services provided shortly before death

Hospice care

Terminal diagnosis

Variety of services and settings

Types of Healthcare Providers

12.4 million workers in U.S. (8.2% of pop.)

39% in hospitals; 26% in outpatient settings; 20% in nursing/residential facilities; 8% each in home health, laboratory, and other ambulatory care services

Over 200 types of careers in the industry

Independent providers

Limited care providers


Physician Assistants

Allied healthcare professionals

Public health professionals

Independent Providers

Specialized education and legal authority to treat any health problem or disease

Allopathic and osteopathic providers

Nonallopathic providers

Allopathic and Osteopathic Providers

Allopathic providers

Produce effects different from those of diseases

Doctors of Medicine (MDs)

Osteopathic providers

Relationship between body structure & function

Doctors of Osteopathic Medicine (DOs)

Similar education and training

Most DOs work in primary care

Nonallopathic Providers

Nontraditional means of health care

Complementary and Alternative Medicine (CAM)

Used together with conventional medicine, therapy is considered “complementary”; in place of considered “alternative”

Chiropractors, acupuncturists, naturopaths, etc.

Natural products, mind-body medicine, manipulation, etc.

Limited (or Restricted) Care Providers

Advanced training in a healthcare specialty

Provide care for a specific part of the body

Dentists, optometrists, podiatrists, audiologists, psychologists, etc.


Over 4 million working in nursing profession

Training and education of nurses

Licensed Practical Nurses (LPNs)

Registered Nurses (RNs)

Advanced Practice Registered Nurses (those with master or doctoral degrees)

Physician Assistants

Practice in many areas similar to physicians, but do not have MD or DO degrees

Training beyond RN, less than physician

Allied Healthcare Professionals

Assist, facilitate, and complement work of physicians and other healthcare specialists


Laboratory technologist/technicians

Therapeutic science practitioners

Behavioral scientists

Support services

Education and training varies

Public Health Professionals

Work in public health organizations

Usually financed by tax dollars

Available to everyone; primarily serve economically disadvantaged

Public health physicians, environmental health workers, epidemiologists, health educators, public health nurses, research scientists, clinic workers, biostatisticians, etc.

Healthcare Facilities and Their Accreditation

Physical settings where health care is provided

Inpatient care facilities

Patient stays overnight

Outpatient care facilities

Patient receives care and does not stay overnight

Inpatient Care Facilities

Hospitals, nursing homes, assisted-living

Hospitals often categorized by ownership

Private – profit making; specialty hospitals

Public – supported and managed by government jurisdictions

Voluntary – not-for-profit; ~½ of U.S. hospitals

Teaching and nonteaching hospitals

Full-service or limited-service hospitals

Outpatient Care Facilities

One where a patient receives ambulatory care

Variety of settings

healthcare practitioners’ offices, clinics, primary care centers, ambulatory surgery centers, urgent care centers, services offered in retail stores, dialysis centers, imaging centers

Group practices versus solo practices



Two or more physicians practicing as a group

Do not have inpatient beds

For-profit and not-for-profit

Some tax funded – created to meet needs of medically indigent

Federally Qualified Health Centers (FQHCs)

Other Types of Outpatient Facilities

Retail clinics at pharmacies

Urgent care centers

Ambulatory surgery centers

Non-hospital-based, specialty facilities

Rehabilitation Centers

Work to restore function

May be part of a clinic or hospital, or freestanding facilities

May be inpatient or outpatient

Long-Term Care Options

Nursing homes, group homes, transitional care, day care, home health care

Home health care

Growing due to restructuring of healthcare system, technological advances, and cost containment

Accreditation of Healthcare Facilities

Assists in determining quality of healthcare facilities

Process by which an agency or organization evaluates and recognizes an institution as meeting certain predetermined standards

The Joint Commission

Predominant accrediting organization

Healthcare System: Function

U.S. “system” unique compared to other countries

Affordable Care Act of 2010

Extends coverage

Curbs health insurance abuses

Initiates improvements in quality of care

Structure of the Healthcare System

U.S. structure – complex, expensive, many stakeholders, intertwined policies, politics

Major issues:

Cost containment, access, quality

All equally important; expansion of one compromises other two

Kissick, W.L. (1994). Medicine’s Dilemmas: Infinite Needs versus Finite Resources. Yale University Press. © 1994Reprinted by permission of Yale University Press

Access to Health Care (1 of 2)

Insurance coverage and generosity of coverage are major determinants of access to health care

2015 – 28.8 million uninsured (9.1%)

6.0 million fewer than in 2013 and 17.5 million fewer than in 2011

Likelihood of being uninsured greater for those: young, less education, low income, nonwhite, male

Greatest reason for lack of insurance: cost; followed by lost job or change in employment

Access to Health Care (2 of 2)

Lack of access to primary care

Factors that limit access are lack of health insurance, inadequate insurance, and poverty

Major component of Affordable Care Act is increasing the number of Americans with health insurance

Health insurance marketplaces – organizations established to create more organized and competitive markets for purchasing health insurance

Quality of Health Care (1 of 2)

Quality health care should be:




Patient centered



Groups that measure quality: AHRQ, NCQA

Quality of Health Care (2 of 2)

National Quality Strategy (NQS)

Mandated by ACA

Guided by three aims: better care, healthy people/healthy communities, affordable care

Accountable Care Organizations

Patient-Centered Medical Homes

The Cost of and Paying for Health Care (1 of 2)

In 2014, health expenditures: $3 trillion

U.S. biggest spender on health care in the world by total spent

Payments come from four sources:

Direct or out-of-pocket payments

Third-party payments from private insurance, governmental insurance programs, and other third-party payers

The Cost of and Paying for Health Care (2 of 2)



Packaged pricing

Resource-based relative value scale


Prospective reimbursement


Centers for Medicare & Medicaid Services (2014). National Health Expenditure Data. Available at

Health Insurance

A risk and cost-spreading process, like other insurance