Evolutions in Health Care Delivery Systems

The Health care delivery systems in the United States of America have a long period of evolution. The health care system which was once a minor venture has now developed into an ever-growing major enterprise. This paper examines the evolution of health care delivery systems and their influences on health care services. A historic overview of the evolution of delivery systems and their influences on health care services are discussed and various models of health care delivery systems are presented. A brief account of Managed Care system and its models is also provided.

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Introduction

The health care delivery systems in the United States of America have a long period of evolution. The health care system which was once a minor venture has now developed into an ever-growing major enterprise. “The prevention, diagnosis, and treatment of disease and injury, and the rehabilitation and maintenance of individuals challenged by the residual effects of those conditions, have generated an enormously complex $1.5 trillion industry.” (Sultz, & Young, 2005, p.xiii). The United States has a unique system of health care delivery. Unlike other countries which provide equal health care delivery systems to all people, the US has different types of health care delivery systems. The post-industrial era in the late nineteenth century provided more advancement in medical knowledge and technology. New medicines and methods of health care were introduced. This increased the reliability of health centers and medical practitioners in the country. The health care delivery systems started becoming a major concern for the government and hence hospitals, nursing homes, medical institutions, and colleges of pharmacy were set up and funded by the government. The period saw the introduction of private and government-funded health insurance. By the mid-’90s, the health care delivery system flourished as more programs were initiated by the government. Programs like Medicare and Medicaid were created to deliver health care for the elderly and the poor respectively. With the advancement in technology, the health care delivery system started becoming more easy, popular, and expensive.

Evolution of Health Care Delivery systems

Health care systems before the 20th century were simple and comprised of traditional treatments. During the years of the world wars, the quality of medical and health care improved. The outbreaks of epidemics reduced and they were brought under control. The nutrition level of the public improved. Paid health care delivery services came into being. Health services were delivered by the doctors and the fee for the service was paid by the patient.

“Delivery system, self-pay policy Understanding the US Health Service System” (Barton, 2007, p.325).

Fee–for–service systems influenced hospitals to provide better inpatient and outpatient care. “The US health care delivery system evolved in response to concerns about cost, access, and quality. The system has been unable to universally provide a basic package of health care at an affordable cost.” (Shi, & Singh, 2009, p.2).

With the advancement of technology, health care delivery became expensive and more complex. The government started controlling the health care delivery systems. Commercial health insurance and the Blue Cross/Blue Shield was developed to meet the growing health care costs. Health care delivery systems included the patient, the medical service provider, the insurance company, and the government.

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“Health care Delivery system participants – an individual with group insurance.

Understanding the US Health Service System.” (Barton, 2007, p.324).

Medicaid and Medicare programs were created under the Social Security Act in 1965 to deliver health care at low cost to the poor and elderly respectively.

Medicaid services are provided to the poor, disabled, and the blind and to single parents with dependent children. The state receives federal funding on a cost-sharing basis for medical services including inpatient and outpatient care, laboratory and radiology services, and nursing facilities.

“Delivery system, Medicaid Program Understanding the US Health Service System.” (Barton, 2007, p.326).

Medicare programs provide health care to all citizens above the age of sixty-five in services like inpatient and outpatient care, home health care, nursing facilities, and a health insurance premium.

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Delivery System, Medicare Program

Understanding the US Health Service System (Barton, 2007, p.324).

With the introduction of Medicare and Medicaid programs, health care services became accessible for more people, especially those belonging to the backward classes. Health Maintenance Organizations (HMO) Act introduced by President Richard Nixon in 1975 played a key role in reducing health care delivery costs. The Act also stimulated the development and growth of HMOs, Managed care, and Preferred Provider Organizations.

There are two subsystems in US health care

The private health care system

The rich, employed middle-class Americans have the freedom of choice of doctors and health care services through the private health care systems. Health care services are given by private medical practitioners or through managed care setups. Private health insurance plans are the major sources that pay for such health care services.

The Public Health care system

The government provides public health care services in the forms of Military Medical Care, Indian Health Services, Community Health Centers (CHCs), and Local – Government Health care.

The Military Medical Care provides health care facilities free of cost for Army, Navy, and Air Force personnel. These are highly sophisticated health care services with cutting-edge technologies. The Public Health Service under the US Department of Health and Human Services manages the Indian Health services to provide health care for American Indian Tribes.

The Community Health Centers and the local government Health care deliver low-cost health care services to the uninsured and unemployed low–class American citizens.

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Managed Care

“In Managed care, both patient utilization and provider practices are managed by an entity that has a fiduciary interest in the interactions between them. Thus, it serves as an umbrella for a range of organizational reimbursement mechanisms in the US health care delivery system.” (Barton, 2007, p.439, chap.19). Managed Care focuses on the prevention of diseases and maintenance of the health of a population, by providing incentives for under-service. In the fee–for–service reimbursement system and in other health insurance systems, duplicative services ordered by the health care provider can lead to misuse of services and resources. This can increase health services costs and cause losses for the insurer. In Medicaid and Medicare systems, the patients are entitled to unlimited health care services which lead to unlimited expenditures. Hence, an efficient health care delivery system had to be developed which could utilize the resources effectively and ensure the delivery of better health care services. This led to the evolution of various models of Managed Care systems.

“Delivery system: Managed Care, self-insured employer. Understanding the US Health Service System” (Barton, 2007, p.328).

The Prepaid Group Practice

One of the early models of Managed Care is the Prepaid Group Practices (PGP) and is an efficient health care delivery system. In this, a predetermined range of services is provided for a particular population for a predetermined price by a single group of physicians.

The Health Maintenance Organizations (HMOs):

“An HMO assumes a contractual responsibility to provide or assure the delivery of a stated range of health services, including at least ambulatory and inpatient care.” Understanding the US Health Service System.” (Barton, 2007, p.449). The HMOs are further divided into several models on delivery of services and financing – Group model HMO, Staff model HMO, Independent Practice Association, and the Network model HMO.

Preferred Provider Organization (PPO)

The Preferred Provider Organizations act as an interface between the patient and the health care service provider. The plans of the PPOs made up the majority of the US health plan market in 2001.

“Managed care transformed the health insurance industry. Companies that were most successful in offering managed care products, especially HMOs, were those that had started up as local or regional HMOs.” (Ginsburg, 2005, Insurance industry, para.3). Managed care led to the arrival of many hospitals in the insurance business. Physicians started specializing in a particular area of health care services. In spite of the various models present, the managed care health delivery systems remain as one of the most efficient health care delivery methods in the US.

The formation of Integrated Delivery systems is the hallmark of the present health care services in the US. “An IDS can be defined as a network of organizations that provides or arranges to provide a coordinated continuum of services to a defined population that is willing to be held clinically and fiscally accountable for the outcomes and health status of the population.” (Shi, & Singh, 2005, p.7).

The US health care system is expensive, unequal in access, and does not have a high outcome. Still, with the evolution of health care delivery systems, the US has been able to maintain a healthier population by giving the latest in health care systems. The quality of services has improved over the years.

Future changes in health care delivery systems are needed in accessing medical health care services, the costs and financing, and the quality of health care services.

Conclusion

Various health care delivery systems and models have been studied and presented in this paper. The evolution of an effective health care delivery system over the years has made the US one of the best and most sought-after countries in health care services. From the period in which only the patient and doctor were the only participants in health care delivery, the country has grown immensely to the present delivery system consisting of health insurances, Managed Care, Medicare, Medicaid, and HMOs. This has, in turn, led to the growth of an efficient medical health care system.

References

Barton, P L. (2007). Understanding the U.S. health services system: How health services are delivered. 3rd edition. 324.

Barton, P L. (2007). Understanding the U.S. health services system: The health services delivery system: managed care: Definitions of managed care. 3rd edition. 439.

Barton, P L. (2007). Understanding the U.S. health services system: The health services delivery system: managed care: Definitions of managed care. 3rd edition. 439.

Barton, P L. (2007). Understanding the U.S. health services system: The health services delivery system: managed care: Health maintenance organizations(HMOs).. 3rd edition. 439.

Ginsburg, P B. (2005). Competition in health care: its evolution over the past decade: Insurance industry. Health Affairs: The Policy Journal of the Health Sphere, 24 (6), 1512-1522. doi: 10.1377/hlthaff.24.6.1512

Shi, L., & Singh, D A. (2009). Essential of the U.S. health care system: Chapter 1- major characteristics of U.S. health care delivery. 2nd ed. Jones & Bartlett Publishers. 2.

Shi, L., & Singh, D A. (2005). Essential of the U.S. health care system: Subsystems of US health care delivery. Jones & Bartlett Publishers. 7.

Sultz, H A., & Young, K M. (2005). Health care USA: understanding its organization and delivery: Introduction. 5th ed. Jones & Bartlett Publishers. Xiii.

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