Improving Health Insurance Market from Nursing Perspective - Term Paper Example

Improving Health Insurance Market from Nursing Perspective Introduction The health care system in America has been an area of serious concern for society and the administrators. There are two challenges that the healthcare system in America faces. The first is the rising health care costs and the second is expanding access of quality healthcare to all the citizens of America. Health insurance plays an important role in the delivery and access to quality healthcare, for it is the predominant manner in which health care costs are met. Any attempt to meet the challenge of rising health care costs and access to quality health care ultimately reverts back to the health insurance markets and the issues that relate to their contribute to these issues. There are three main areas of concern when the health insurance market in America is evaluated. These three main areas of concern associated with the health care insurance market are cost, quality, and availability of healthcare. There is growing acceptance to the contention that the market structure of the health insurance and hospital sectors has had a strong influence on the rise in health care costs and in the limited access that Americans have to affordable health insurance and health care (Austin & Hungerford, 2009). On March 23, 2010 the Congress passed the Affordable Care Act (ACA) with the objective of expanding access, improving quality, and with the hope that it would make health care more affordable through control on costs (Wiley, 2010). The ACA will have its impact on the health insurance market, but the public opinion remains strongly divided on ACA. An opinion poll conducted by the Kaiser Family Foundation shows that 21% of the public are in favor of expanding the health reform law, while 19% are satisfied in its present form, and 24% want the entire law repealed (Gardener, 2010). The Health Insurance Market The market structure of the current American health insurance industry reflects its origins and the subsequent developments, as also the nature of health care received by the citizens. The origins of the healthcare insurance industry go back to the 1930s. It was not that there was an absence of health insurance prior to this. From the latter half of the nineteenth century onwards private insurers did provide accident, burial, and sickness policies, while some of the railroad, mining, and timber companies provided workplace health benefits. However, health insurance in its complete form and in an organized manner took root from the 1930s onwards. Against a backdrop of skepticism prior to World War II of a greater proportion of commercial insurers that hospital and medical costs were an insurable risk, health insurers did offer accident, burial and in America became a reality through the efforts of Blue Cross in the mid 1930s. The success that Blue cross achieved in its health insurance offerings brought competitors into play to share in the health insurance pie in America. This rising potent competition resulted in the erosion of market share of Blue Cross and changed the competitive scenario of the health insurance market. The health insurance market now consisted of the non-profit organizations of Blue Cross or Blue Shield and the for-profit commercial health insurers (Austin & Hungerford, 2009). Towards the end of the 1950s health insurance had become a standard component of the compensation offered by most of the large employers in America. The Federal Employees Health Benefits Plan (FEHBP) which was created by Congress made available to federal workers across the country Blue Cross and Blue Shield health insurance benefits. However, this was the period of time when for the first time a sharp increase in health care costs were experienced. Fuelling this were several reasons that included emergence of new hospitals; growing capital intensity for providing inpatient care; the change from, flat-rate per diem reimbursement for hospitals to full cost payment; and the widening of health insurance benefits that enhanced the ability of patients to pay more for health care. These cost increases for health care resulted in Blue Cross and its affiliates raising insurance premiums substantially, resulting in rising public concern and resistance to these increased premiums (Austin & Hungerford, 2009). One of the consequent measures was witnessed during the Johnson Administration during 1965, when Medicare and Medicaid was created, despite the fears that it would work against the for profit insurance companies. Medicaid consisted of a compulsory hospital insurance program and a voluntary physician service plan. Medicaid consisted of the means-tested program that received federal and state fund support. Blue Cross was appointed as the fiscal intermediary for Medicare. The non-profit Blue Cross organizations enjoyed tax exemption benefits since their inception in the 1930s (Austin & Hungerford, 2009). However, this benefit enjoyed by Blue Cross over the for profit private insurers was mostly taken away in 1986. The rising health care costs coupled with practices within the health care insurance sector led to the demise of some of the Blue Cross affiliates. To offset this Blue Cross affiliates were allowed to convert into for profit organizations. Consequently some of the Blue Cross affiliates were acquired by the private insurance companies, while in other places the Blue Cross affiliates acquired other insurers, merged, and restructured to consolidate their market positions. The consequence of these actions was that the health care insurance market now consisted of a few for profit insurance companies in strong entrenched positions spread across America, which reflects the current status of the health care insurance market in the country (Austin & Hungerford, 2009). The features of the current health insurance market contribute to hindrance of the market, concentration of the market, and result in inefficient outcomes. In addition, the health insurance market is closely connected to the other components of the health care sector. This feature arises from health insurers being the intermediaries in transactions involved in the provision of health care between the patients and the health care providers; reimbursing the health care providers for services provided to the patients; carrying some control provisions on the quantum and type of services received by the patients; and negotiating contracts with the health care service providers that cover the costs for the provision of health care services. This means that any policy decisions taken by the administration on health insurance will have its influence on other segments of the heath care sector. Evidence points to the health insurance markets being highly concentrated in several local areas. Quite a few of the large companies that provide health insurance benefits for their employees are self-insured that adds to the competitive pressure experienced by the health insurance companies, though without the benefits of competition accruing to the consumers. The normal consequence of market power by firms in concentrated markets is higher prices and lower output, which translates into higher premiums and lower access to health insurance yielding higher profits to the health insurance companies. The higher costs and limited access associated with the health insurance sector is not limited to this factor, but is also the result of several other contributory factors of the health insurance market. Rising health care costs is a key aspect in this regard. The rise in health care costs is the result of the complex interaction between the health insurance sector, the health care service providers sector, employers, pharmaceutical industrial sector, tax policies and the medical technology sector. Restraining the growth in health care costs calls for policies that affect these interactions. However, while policies may contribute partially to providing results towards this objective, but by themselves are incapable of being the solution for solving the twin problems of high costs and limited access to health care (Austin & Hungerford, 2009). Improving the Health Insurance Market, from a Nursing Economics Perspective There are two key deficiencies in the health insurance market, consisting of high costs and poor accessibility. Improving the health insurance market means targeting these lacunae in the health insurance market. Administrative policies though a significant factor cannot work in isolation. This aspect brings the role that the health care professionals can play in contributing to the health insurance market, with particular emphasis on reducing costs to their patients. It may appear that nursing with a limited role in the administration of health care institutions and health care insurance providers cannot do much. Appearances are deceptive here, for through their close association with patients in their provision of nursing care, nursing professionals can contribute to reducing costs of health care that their patients receive. Irrespective of the health care institution, nursing plays an important role in quality of the health care provided and the costs involved in the provision of health acre, thereby having the potential in addressing the high cost outcomes issues. Demand and supply are the economic factors that influence price. Nursing is in a position to influence the demand and supply of health care services, with particular emphasis on high cost and unnecessary treatment strategies or investigation modalities and lengthy stays in the hospital environment (Hartmann, 2009). The key contributions of nursing in improving the health insurance market include increasing the access that patients have to health care; educating patients on their actual health care needs; cost-effectiveness of the health care provided; adherence to treatment strategies; reducing the need for hospital admission; decreasing the length of hospital stay, when hospital admission is unavoidable; reducing the possibility of readmission to hospital care; reducing the requirement for costly emergency room visits all of which contribute to the meeting the objective of lowering health care costs towards improving the health insurance market (Mick, 2008). The American Nursing Association (ANA) highlight the key professional services and skills rendered by nursing that have a strong influence in reducing the costs of health care to the patients. These key professional services and skills consist of prevention and screening for diseases and conditions; providing health education; cultural competency in a country steeped in cultural diversity; efficient management of chronic diseases; coordination of the provision of care needs and addressing the community-based primary care needs in the country. However, quite often it is nursing that is targeted in plans to reduce health care costs through the reduction in nursing positions and the facilities made available to nursing in expressing their professional services and skills (American Nurses Association). Medicaid benefits are now available to low income populations that were never under its cover before, while Medicare has expanded the categories of individuals that benefit from it. The combination of these factors along with role of nursing in improving the health care market will result in the community settings having a much larger responsibility in meeting health care needs of the people of America. The quicker discharge as a result of nursing contribution to better quality of health care services provided in hospital settings will contribute to reduced hospital stays. At the same time this will mean that more nursing services will be required at home settings and community settings. The cost of health care service in hospital settings is much higher than the cost of health care services in home or community settings. This will contribute to lowering of cost of health care services provided to patients. With the increase in the proportion of the older population and its increasing growth, chronic illnesses will see a rise in prevalence. This will expand the health care insurance market in community setting reducing the concentration of health care insurance in urban areas. Lowering the costs of health care would mean seeking ways that reduce the costs in the provision of health c are services, particularly with increasing needs for health care services in the community settings. This search for lower costs in the labor for providing these services will translate into nursing services taking up additional responsibilities in the providing of health care services ay least in the community settings. Though not all medical professionals agree to the taking up additional responsibilities by nursing services in the provision of health care services, nevertheless there is enough evidence to show that there is no deficiency in the quality of health care services provided by nursing services in nursing independent care settings. Reducing costs of health care and providing more access to health as the means to improving the health care insurance market will require a greater role for nursing services and quite likely as independent services in the community settings (Maurer & Smith, 2005). Conclusion Health insurance started in America in the 1930s under skepticism on its success. Since that time health insurance has become the way by which people meet the costs of health care needs. However, this growth has come at the cost of high costs of health care and the poor accessibility to health care. Factors intrinsic and extrinsic to the health insurance industry have led to this situation in the health care industry, which has led to the need of the hour being improvements in the health care insurance market, with particular emphasis on lowering health care costs and enhancing access. Nursing services can and will play an important role in the efforts to improve the health insurance market. This enhanced role will in all likelihood also include more responsibility for nursing services in the form of independent settings in the communities. . . Literary References American Nurses Association. (2009). ANA on Reducing Health Care Costs. Retrieved March 29, 2011, from http://www.nursingworld.org/MainMenuCategories/HealthcareandPolicyIssues/HealthSystemReform/What-ANA-is-Doing/ANA-on-Reducing-Health-Care-Costs.aspx Austin, D. A. & Hungerford, T. L. (2009). The Market Structure of the Health Insurance Industry. Congressional Research Service. Retrieved March 29, 2011, from http://www.fas.org/sgp/crs/misc/R40834.pdf Gardener, D. (2010). For Health Care Reform to Survive we Must Stick to the Facts. Nursing Economics, 28(6), 401-402. Hartmann, S. (2009). Economics of Health Care. In Karen Saucier Lundy & Sharyn Janes (Eds.), Community Health Nursing: Caring for Public Health Second Edition (pp.156-184). Sudbury, MA: Jones and Bartlett Publishers. Maurer, F. A. & Smith, C. M. (2005). Community/Public Health Nursing Practice: Health for Families and Populations. Third Edition. St. Louis, MO: Elsevier Saunders. Mick, J. (2008). Factors affecting the evolution of oncology nursing care. Oncology Nursing, 12(2), 207-213. Wiley, E. (2010). Health Care Reform at Six Months - Feat or Failure? Retrieved March 29, 2011, from http://boards.medscape.com/forums?128@836.boCTa5BEPEJ@.2a030e99!comment=1 Read More