Final Review - FINAL 50 questions: multiple choice,...

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1 Copyright 20 rights reserv FINAL POWERPOINTS Final Exam is August 1, 2011 5:30 -8pm p.m. in LRC 215/219 08 Health Administration Press. Al ed. 1 FINAL 50 questions: multiple choice, true/false, and calculations (case study 4 and 5) 10 questions from each unit (6-9) 5 questions related to case study 4 5 questions related to case study 5 2 UNIT 6 3 CHAPTER 8—EPIDEMIOLOGY AND FINANCIAL MANAGEMENT 4 5 DEFINITIONS Health insurance: a mechanism by which an individual or organization can pay monthly premiums to an insurance carrier in return for which certain “covered” services will be paid for by the carrier 6 Managed care: an organization that combines the financing (insurance) and delivery of healthcare services Capitation: a process of managed care by which providers (e.g., hospitals, physicians) are paid a monthly rate (capitation payment) for each member for whom they are responsible, regardless of whether that member uses healthcare services
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2 MANAGERIAL EPIDEMIOLOGY AND THE FINANCE FUNCTION o Effects of capitation on financing, patterns of delivery, access, quality, outcomes 7 o Driven by changes in incentives, per-member-per- month (PMPM), rather than fee-for-service (FFS) o How to conserve resources? o Process of care efficiencies o Selection of risks ENROLLMENT CHOICES IN CAPITATION PLANS o Consumers choose a plan among a menu of plans o Capitated plans choose members 8 o Both can lead to selection bias o Active selection—“cream skimming” o Passive selection—attract low risk, repel high risk HOW TO ATTRACT LOW/HIGH RISK? o Adverse versus favorable selection o Copayments and premiums o Focused or comprehensive services 9 o Preexisting condition clauses o Provider networks o Location of facilities WHAT IS ADVERSE SELECTION? o High-risk patient selectively choose/are chosen by plans o Moral hazard and adverse selection 10 o Why “hazard,” and is it “moral”? o Information asymmetry and adverse selection o Patient knows more than plan regarding future use HISTORICAL CONTEXT: COMMUNITY VERSUS EXPERIENCE RATING o Community—single premium for same benefit package o Low risk cross-subsidizes high risk (income transfer) 11 o Premium price to low risks marginal costs of benefits o Experience—premiums based on expected use o Equitable if low income are high risks o Issue is “actuarial fairness” should premium = f(expected use) HOW TO NEGOTIATE CAPITATED RISK CONTRACTS? o Depends on assumptions: actuarial fairness or equity o If experience rating adjust premiums on the basis of expected use o Retrospectively (historical patterns) 12 o Concurrently—morbidity profiles o Prospectively—risk factors of disease (e.g., high blood pressure) o If community rating have same premiums o Subsidize high-risk patients within plans (higher rates to low risk) or across plans (using a high-risk pool)
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3 CAPITATION BASICS o Relationship between cost and quality is far from simple o Population risk = f(enrollment/disenrollment strategies) 13 HOW TO MANAGE POPULATION RISK?
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This note was uploaded on 08/21/2011 for the course AHS 375 taught by Professor Elder during the Summer '11 term at University of Alabama at Birmingham.

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Final Review - FINAL 50 questions: multiple choice,...

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