Financing Healthcare
Introduction
There exists a close relationship between renumeration in healthcare and quality of care and as a result, there is a need to focus on how healthcare service compensation shapes the delivery of care in clinical settings. Healthcare service compensation also directly reflects on the policies within the healthcare system and how such policies are changed to ensure operational efficiency within healthcare. Medical practitioners receiving better compensations are linked to healthcare facilities that provide quality care and as a result, this has resulted in payment reforms and policy changes to ensure better policies within the healthcare and one such reform is the pay-for-performance. Pay-for-performance has become popular among healthcare policymakers and has been widely been adopted into health insurance markets to promote patient-centered outcomes.
History of managed care and private insurance
Private health insurance has had a tremendous effect on shaping medical care and as such it is only prudent to reflect upon the history of the private health insurance industry and manage care and how this industry has evolved into the current healthcare industry. Health insurance may be defined as an insurance coverage that caters for the surgical cost and the medical bill of the insured. There are different types of medical insurance coverages or packages and cater for different medical procedures or services and will vary based on cost, the insurance provider, and the choice of insurance cover selected by the insurer.
In the United States, private health insurance was developed in an effort to help medical practitioners and hospitals to deal with the economic challenges caused by the Great Depression (Morrisey, 2013). Managed care and conventional insurance also developed during this period. Managed care and conventional insurance discouraged patient price discrimination by medical physicians and as a result, both managed care and conventional insurance received a lot of challenges at the time. In the mid-20th century, tax exemptions on organizational-sponsored health insurance greatly promoted the growth of health insurance. The private health insurance later introduced low prices tailored towards individuals with potentially low risks of claims and this greatly promoted the growth of private health insurance and with the introduction of Medicare, Medicaid, and the growth of insurance cover offering a highly deductible insurance plan for a more consumer-driven healthcare as well as the subsequent introduction of Patient Protection and Affordable Care Act (Morrisey, 2013).
Federal regulations
Most federal laws affecting the healthcare system are also applicable to the private health insurance (PHI) market. Such federal laws impose legal requirements and act as an enforcement tool on sponsors of the medical insurance coverage. Federal laws on medical insurance are designed to offer protection to persons benefiting from private insurance.
Federal regulations on who sell insurance offer protection to persons insured through ensuring that such institutions have the required financial competence; both human and technical resources that are aimed at ensuring an optimum service provision to beneficiaries of the insurance cover (Motaze et al., 2015)
The national governments may also implement risk adjustment mechanisms to ensure that both individuals with a low -risk and a high-risk enjoy the same insurance coverage at the same price (Motaze et al., 2015). Such regulations protect individuals at a high risk of a certain medical condition from being overly charged by private insurance companies compared to individuals at low risk of suffering from similar medical conditions. Insurance companies are also likely to discourage sick individuals from procuring private medical insurance covers and through the risk equalization regulation such individuals are protected from healthcare inequalities.
Private health insurers are also required to provide a minimum health package to the general public to ensure the provision of medical services based on social needs and not on an individual’s financial competence. This regulation, therefore, protects consumers against unrestrained exclusion and as a result reducing inequalities by improving equity and access to medical services (Motaze et al., 2015).
The federal government also provides interventions through regulating how private insurance companies price insurance packages as well as provider payment procedures (Motaze et al., 2015). Through regulating insurance products, the government ensures equity, consumer adverse selection, and promote affordability of health services through affordable insurance packages. Regulating provider payment procedures helps in addressing issues arising from fee-for-service payments in incidences involving consumer increased demand for certain healthcare services which may prompt insurers to encourage unnecessary use of healthcare services.
Consumer-driven healthcare
The insurance industry operates on the basic principle of “a pool of risks”. The pooled resources, therefore, bring about the concept of collective decision making as the individual benefiting from the insurance cover is benefiting from the pool of resources. Consumer-driven healthcare is on the other hand aimed towards the reassertion of a person’s decision over a joint decision making
A consumer-driven healthcare or consumer health-driven plan is therefore designed to ensure consumer satisfaction through influencing the healthcare system to offer products and services tailored towards the needs of the consumer. In the healthcare industry, consumer-driven healthcare is often used interchangeably with patient-centered care. Consumer-driven healthcare, therefore, strives to empower patients to express their needs and wants and towards a weak role for the medical practitioners, insurers, and medical regulators.
Consumer-driven healthcare can, therefore, be referred to as a form of a health insurance allowing insurance product consumers to use their out-of-pocket payments or medical payment accounts such as the health reimbursement arrangement (HRAs) and the health saving accounts (HSAs) to cover the low-cost predictable medical expenses such as routine medical check-ups. The consumer-driven health plan is a product of the Affordable Care Act aimed at ensuring that routine health claims are catered for with no co-insurance sharing to ensure a low cost of the insurance policy compared to the traditional insurance plans.
Consumer-driven healthcare also empowers healthcare consumers through the use of a consumer-controlled account. The consumer-controlled account gives the patient control over their health budget unlike fixed health insurance and as a result, patients experience the freedom to choose a type of care. A health care system that is consumer-driven also ensures transparency, efficiency, and promotes ethics within the health system, and as result beneficiaries of consumer-driven healthcare are more likely to be more satisfied.
Private Insurance Market and Nursing Opportunities
The healthcare system is continuously advancing towards an improved quality care approach while reducing the cost of medical expenses. Nurses are particularly strategically positioned towards the realization of these transformative changes as we move from the health practitioners- based reimbursement-for service care to a more patient-centered, team-based care aimed at providing quality and affordable care to patients.
Consumer-driven healthcare insurance covers offer patients an opportunity to make decisions affecting their health. Nurses are perfectly positioned to offer patients patient-centered care that is holistic and focused on empowering patients to assume control over their care through a well-informed disease management system. The Consumer-driven healthcare insurance covers will, therefore, increase patient’s preference towards nurses as the primary caregivers both in outpatient and inpatient services and as a result creating more employment opportunities for nurse practitioners (NPs). With the help of government regulations, private insurance covers are now more accessible to members of the general public and as a result, more patients are more able to access medical services.
The demand, affordability, and easy access to medical services is likely to result in the need for more medical practitioners. Considering nurses are the primary caregivers in most medical settings this is also likely to result in an increased employment opportunity for nurse practitioners as well as a potential reimbursement increment (Salmond & Echevarria, 2017). Further, nurses have the opportunity to participate in the private insurance market as valuers and administrators since they are able to review common codes used in the treatment and billing of patients at the point of discharge.
Conclusion
In conclusion, the primary role of the health insurance is providing easy and convenient access to medical care with monetary risk protection. Private health insurance is voluntarily procured and paid for privately by organizations on behalf of their personnel or by individuals and such insurance providers are usually not state-owned. Proper compensation plans and regulations ensure that healthcare institutions receive the funds they require in a timely manner to enhance their ability to deliver patient-centered care. This enhances opportunities for professional nurses as they are able to provide their services in the billing and reimbursement process.
References
Morrisey M. (2013). Health Insurance (2nd Ed.) Chapter 1: History of Health Insurance in the United States. Health Administration Press.
Motaze, N.., Chi, P., Ongolo-Zogo., Ndongo, S., & Wiysonge, C. S. (2015). Government regulation of private health insurance. The Cochrane Database of Systematic Reviews, (4).
Salmond, S. W., & Echevarria, M. (2017). Healthcare transformation and changing roles for nursing. Orthopedic nursing, 36(1), 12.
