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45 Cards in this Set
- Front
- Back
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What is the health care system?
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A network of producers, providers, insurers, payers, and users that interact for the purpose of supplying and demanding health care.
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Rugged Individualism
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Pockets of providers, self-pay system:providers able to set the price.
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Managed Care
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A more structured network of providers that is formed to offer cost-effective services.
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HMO
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Prepaid health plan in which enrollees pay a fixed fee often with co-payment for designated health services.
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PPO
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Contracted network of physicians, hospitals, and other providers organized by an insurance carrier to provide health care. Offers more choice of providers than an HMO.
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PBM
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Carve out the pharmacy benefit from primary health insurance plans.
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OBRA
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Mandated pharmacists to offer to counsel Medicaid patients on outpatient prescription drugs. Also required pharamcists to document patient counseling and offer DUR activities.
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Premium
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The monthly fee the employer group must pay to purchase the health insurance benefits.
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Underwriting
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The process of projecting financial risk.
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Capitation
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Provider receives a fixed monthly fee for providing covered services based upon the number of enrolled memebers that are assigned to a provider. Receive the same monthly fee no matter how many times the members see the providers. Provider shares risk, more likely to use generics/formulary drugs.
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Gatekeeper physician
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HMO memeber must select a primary care physician that has the responsibility of coordinating all care for that patient.
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Discounted fee for service reimbursement
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Provider receives payment when a provide a service. Reduce cost per service and the reamining amount is in a reserve to be paid out if objectives are met.
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Trends in national health care spending
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Private payers played a greater role in slowing spending than public. Drug spending grew more slowly for all payers. Medicaid=largest spender. Growth in use of generics, increased OTC use, mail order dispensing, decrease in generic copays
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Perfectly Competitive Market
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Many buyers and sellers, freedom of entry and exit, homogenous goods, full/free info. No single buyer/seller has control over the price.
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Monopoly
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Exist one seller in the market. Competition from other products depends on the extent to which other products are substitutes.
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Monopolistic Competition
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Most firms face relatively close substitutes and the commoditites are not completely homogeneous. Product differentiation exists. Demand/cost curves are the same for all firms in the group.
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Oligopoly
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Small number of firms, great deal of interedependence. Each firm formulates his policies with an eye to the effect on rivals. Any change in the firm's price/output influences the sales/profits of competitors. Can be differentiated.
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Monopsony
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Situation in which there is a single buyer.
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Assumptions surrounding an agency relationship
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1.both players are motivated by self-interest, Effort. 2.functions in conditions of incomplete info. 3. differ in amt. of risk willing to assume. 4.assumes that outcomes of agents actions are influenced by enviro. factors.
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Hidden information problems or problems of adverse selection
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Principle doesnt know if the agent is capable. (get certification).
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Hidden action problems, moral hazard problems
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agent may not perform actions the principal desires becuase of conflicting goals, differences in risk preference. develop a relationship with agent to help.
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Solutions to agency problems
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invest in monitoring activities, reward agents if a certain outcome is achieved
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Group Rating
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Actuary estimates amt. of risk and can adjust reates for a specific subset of insured individuals, usually an employer group, based on the group's experience the previous year.
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Community Rating
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Actuaries adjust estimates based on the insurance companies overall expenses for a specific geographic area during the previous year.
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Self-funded insurance.
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Company decides to put a large sum of money into a restricted account that can be used to pay for health insurance. rare-very risky.
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Elimination Period
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avoid adverse selection by not covering pre-existing health problems until after the policy holder has been covered for a certain amt. of time.
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Trends in Employer Sponsored Health
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decrease in coverage among employees, increase in employer premiums, increase in employee contribution
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Indemnity Insurance
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health insurers initially reimbursed subscribers not proviers for a portion of their medical expenses. Premiums of these plans rapidly increased due to the cost of processing claims.
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Service Benefit
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health care providers are paid directly by the insurance plan.
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Federally Mandated Eligibility for Medicaid
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Categorically needy:AFDC aid to poor families with dependent children, supplemental security income (SSI):poor and aged, blind, disabled. Qualified Medicare beneficiaries (QMBs) people who are eligible for medicare and have incomes below the FPL.
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Skimming
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Innovative drugs, start at high price, graduallyl raise the price.
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Penetration
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Initially at a low price to gain market share and then price is raised over time. Drugs w/limited therapeutic gain. Undercut competitors. Raise the price once brand loyalty is established.
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"Me too" drugs
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diff. in side-effect profiles, convenience, efficiency, efficacy makes them more attractive, worth more.
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Trends in utilization of drugs
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Increased utilization due to increasing age of the population, insurance coverage, availability of drugs.
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Trends in retail prices of Rx's
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41.6% increase from 1999-2005. Price growth consists of inflation and product mix.
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Assignment
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Pharmacy agrees to the assigned price and cannot seek additional reimbursement from the patient.
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Sliding Mark-Up Scale
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Uses variable mark-up percentages or fees to calculate prescription prices. As cost increases, mark up decreases.
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Usual and Customary Charge
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the normal charge to self-pay patients.
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Prospective Payment
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Set rate in advance for certian diagnosis, diagnosis related groups.
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Shared Savings
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Proportional share of expected savings, if the patients costs are less than the fee.
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RVU
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relative value units, assign relative numeric values to health care services based on the complexity of the services and the amt. of time/resources it requires in comparison w/a standard reference.
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RBRVs
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resource based relative value scale. each service is evaluated in comparison to other services for the amt. and quality of the providers' resources required to provide the service.
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Per Diem
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fee per day paid for care, fixed rate.
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Incentive payment
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pharmacist's fee is based on a percent of the savings which the pharmacist generates for the payer.
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DUR
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ongoing study of the frequency of use and cost of drugs, from which patterns of prescribing, dispensing and patient use can be determined.
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