Over the past decade many governmental entities and private organizations have tried to quantify the quality of healthcare in America. The bottom line is that there is wide variance in the quality and cost of healthcare through the United States. It is hoped that by tracking the results of the various studies that are being conducted around the country, that the quality of healthcare can be improved while the increase in the cost of care can be restrained.
The California Healthcare Foundation has sponsored a comparative study which compares the quality of California Healthcare to that in the rest of the Nation. If the state of California were in school it would receive a ‘C’ for the performance of its healthcare system, compared to the rest of the nation.
California outperforms the National average in:
- Maternity and child healthcare
- Hospital care of patients with heart problems and pneumonia
- Cancer rates and cancer mortality rates
California underperforms the National average in:
- Care for geriatric patients
- Nursing home quality of care
- Diabetes diagnosis and treatment
California has about average care in:
- Hospital re-admission rates
- Improvement in hospital treatment of Pneumonia and Heart disease
- Home healthcare providers
In the years covered by the study (2001 – 2005), the average annual increase in healthcare costs was 6.5 %, while the increase in quality of healthcare grew only 1.4%. This suggests that there is room for improvement in the cost effectiveness of healthcare throughout the Nation.
The most interesting result of the study is that California outperforms the National average in the care of the younger portion of the population. California scored high in care of expectant mothers, infants, and children. California performed well on measures related to pre-natal care, low birth weight, and low infant mortality rates. California ranked high in birth-related traumas, immunization levels for children, and reduction in admission rates of certain pediatric conditions.
Treatment for cancer and heart related conditions are at the national level of care, or slightly above the national average. Measures of standard of care in surgical treatment in hospitals and outpatient care are inline with the national averages.
At the other end of the population age scale the State under performed in most categories of geriatric care. The number of seniors receiving vaccinations is below the national average. End of life care is measured as falling below the National standard of care, and the quality of nursing home care falls short of the national average.
It is important to note the California improved in its treatment of Pneumonia, cancer, and heart related cases faster than the national average. This may indicate that the standard of care in California is improving at a faster rate than the nation as a whole. However, there were still total of 1031 preventable adverse events in California hospitals in 2007. Since 2007 a total of 57 hospitals were fined $25,000 for each licensure violation.
ANALYSIS OF THE DATA
The data from this study would seem to indicate that the California healthcare system does a good job in treating the younger segment of the population. It does an average job in treating health conditions of the general population. But it does a poor job in the treatment of the older segment of the population. This may be because the population of California is younger than the average population throughout the rest of the nation. Perhaps more emphasis is placed on the younger patients, or California attracts better qualified doctors because of the younger population. In any case, the state of California may want to reallocate its healthcare resources to provide better healthcare for the geriatric portion of its population. This will become even more important as the population ages.
The complete study can be found in the California Health Care Almanac: Quality of Care facts and figures, August 2009
The current debate regarding health insurance and health care is really a discussion over two distinct issues. Health insurance is a risk management product sold by insurance companies, while health care involves medical services provided by hospitals and doctors. This distinction is very important when discussing the reforms proposed by lawmakers, and an examination of the issues surrounding each is important to reform.
Health Insurance
Health insurance is a product sold to those who cannot afford to pay for the service of doctors and hospitals out of their own pocket, and this includes most Americans. While there are various types of health insurance programs, they are all designed to accomplish one important task; to provide the funding necessary to pay for expensive medical treatments that the policyholder would otherwise not be able to afford. The economics of health insurance companies is based on a general insurance concept known as the “law of large numbers”. This means that many people together will pay money to an insurer. Some of them will need to use some of that money at some point, but not everyone will. The insurance company takes a chance that enough people will not need to use the coverage so that they will have enough money from premiums collected from everyone to pay for the medical bills of those who do need to use the insurance. In other words, everyone pools their money so that the sick and injured can get their bills paid. Insurance companies primarily make money from the investment income derived from the premiums. If there is money left over at the end of a year in premiums not used to pay claims, insurers will have what is called an underwriting profit. Insurance companies do not often realize an underwriting profit, especially during down economic times.
Insurance companies use people called actuaries to make a best guess as to what type of customer is more likely to need to use the insurance and health insurance rates are determined from this data. In some cases, those more likely to use the coverage are charged more, and sometimes the costs are spread around to everyone.
Health Care
The cost of medical care in the United States has risen at a rate higher than the growth rate of GDP since 1970, and the trend is expected to continue. There are many causes for this growth including technological advances in medicine, more frequent need for health care as baby-boomers age, and widespread fraud and waste. Many also argue that the high cost of malpractice lawsuits make medical care expensive.
When insurers pay more for health care, it follows that they will charge higher premiums to avoid an underwriting loss.
Reform
The current reform debate involves proposals that will change the way health insurance works, but may also change the way that health care is administered. This has become a very contentious issue as people consider the possibility that government administrators may have control over decisions that their doctors will make. It should be recognized that health insurance companies currently have a significant role in deciding what treatments are covered. With the current system of health insurance however, an appeal process exists that may not be available under a government run program.
Health care is simply too expensive, and that is why health insurance was developed. The problem now is that health insurance is also becoming too expensive for many Americans and that is why lawmakers are working hard on a reform bill to address this issue.
There is plenty of discussion about healthcare reform throughout the country these days. The bills currently under discussion in Washington thee days are over 2000 pages of ‘reforms’. In reality, the main emphasis these ‘reforms’ is who will pay the bill. There are some true reforms around the edges of the bills, but very little of real substance.
Rather than impose a government run healthcare plan on everyone, which many opponents claim will actually increase demand for healthcare (after all it’s ‘free’, right) and subsequently the cost; true reform would emphasize personal responsibility which would reduce demand and cost throughout the healthcare system. The current system which has developed over the years has no responsibility anywhere in the system. The three main players in the healthcare system:
The payer (usually the employer)
The provider (usually a doctor or hospital)
The patient (you)
all have different and opposing interests. Very rarely do all three parties get together in the same room and talk. The payer wants to pay as little as possible, the provider wants to get paid as much as possible for as little as possible, and the patient wants as much care as possible. These interests are diametrically opposed, so there is not much communication between the three factions.
No matter what happens in Washington concerning healthcare, you need to provide for your family’s healthcare One way to make sure that you are able to get the healthcare that you and your family need is through a Health Savings Account (HSA) also known as a Medical Saving Account (MSA) coupled with a high deductible, catastrophic healthcare insurance policy. There are many advantages to having an HSA in your own name:
• You have personal responsibility of your own health
• You can control your healthcare costs
• There is a true incentive to live a healthy lifestyle
• You can visit the providers that you want to visit
• The account is funded through tax advantaged dollars
• Your employer can contribute to the account
Here’s an example of how an HSA works:
You set-up an HSA through a ‘qualified’ trustee/custodian. These are banks, credit unions, or other entities set-up to handle an HSA. You must purchase a High Deductible Health Plan (HDHP) in conjunction with the HSA. Generally, these plans are much less costly than traditional insurance plans. The money you save on premiums may be enough to fund the HSA portion of the plan, which should be in the amount of the deductible of the HDHP. Routine medical costs are paid for through the funds in the HSA. Normal doctor’s visits, prescription drugs, chiropractic visits, licensed acupuncture treatments, massage therapy, and nutritional supplements can all be paid for through an HSA. If the deductible of the HDHP is met, (and the funds in the HSA are exhausted) the insurance portion kicks in to pay for medical expenses. If there is money remaining in the HSA account, that money can be rolled over into the next year, to help fund the next year’s HSA.
There is a true emphasis on preventative healthcare through the availability of alternative car and nutritional supplements paid for with pre-tax dollars. The incentive to staying healthy is real because you are spending to own money on healthcare. Personal responsibility is also emphasized, because you are spending your own money. Any money not spent from the HSA is carried over, and grows tax-free, similar to a self directed IRA. If executed correctly, an HSA can save money and actually provide you with better overall health and the peace of mind that you are covered in the event that you require extensive medical treatment.
