09.27.11.Big_Picture - The Big Picture: Payers, Health...

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The Big Picture: Payers, Health Insurers, Providers, and Suppliers And An Introduction to Health Insurance HCMG 101 Daniel Polsky September 27, 2011
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Recap from Thursday Cutler’s Conclusion: Benefits of Medical Advances > Costs Cardiovascular disease 4:1 Low-birth-weight infants 5:1 Depression 7:1 All medical care combined >1:1 Benefit:Cost Ratio Medical care costs a lot, but it’s worth it: most people would prefer today’s medical care at today’s prices to yesterday’s medical care at yesterday’s prices.
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Today’s Objectives Big picture of how money flows in health care Health insurance http://www.polleverywhere.com/multiple_choice_polls/MjEzNjc0NTU0Mw The basics Big issue #1: Adverse selection Underwriting and rate setting Discuss why most people in the U.S. receive health insurance from their employer
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Payers: consumers, taxpayers, Determine how much to spend on health care and businesses, government what types of benefits to include in health plans or national health insurance. $$$ Insurers General contractors: negotiate with providers regarding how and how much they will be paid. “Manage” patients’ use of medical care. Providers: MDs Sub-contractors: combine medical inputs (e.g., drugs, and hospitals medical devices, and labor) to provide medical care. Suppliers Supply medical inputs (e.g., drugs, devices) to providers. Health Care System $$ $
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Sources and Uses of Health Care, 2006 Payers (sources) Insurers Providers (uses) Suppliers (uses) Private Health Insurance Plans Medicare 16% Medicaid 16% Physicians Hospitals Nursing Homes Dental Other 23% 33% 6% 5% 22% Labor Prescription drugs Medical supplies and devices taxes Other 9% Source: Catlin, 2008. Businesses/Employees Patients Government Other 43% 13% 40% 4% Insurance premiums Deductibles, co-pays, and uninsured services 11%
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It is not like buying a sandwich ABP Houston Hall Cosi Truck Greek Lady Bread guy Veggie guy Meat guy Hungry person Cash Payers (sources) Insurers? Providers (uses) Suppliers (uses)
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Private health insurance companies Consumers/ Employers Government (public insurance) Providers - physicians - hospitals - nursing homes - home care Health Insurers Act as “Intermediaries” Pay premiums before receive medical care Deliver medical care to produce health Pay co-insurance, co-pay, deductible Insurance for poor, elderly, and disabled Taxes - reimburse providers - set patient cost sharing amounts - “manage” delivery of medical care - reimburse providers - license physicians - approve/reject drugs - award drug patents - fund medical research - subsidize medical education Insurance
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Today’s Objectives Big picture of how money flows in health care Health insurance The basics Big issue #1: Adverse selection Underwriting and rate setting
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Types of Insurance Car Insurance: When an accident occurs, the insurance company pays the claim -- to cover the financial
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This note was uploaded on 10/26/2011 for the course ASDF 2342 taught by Professor 2adga during the Spring '11 term at Mansfield University of Pennsylvania.

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09.27.11.Big_Picture - The Big Picture: Payers, Health...

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