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HEALTH POLICY Crisis and Reform in the U.S. Health Care Delivery System Fifth Edition HEALTH POLICY HEALTH POLICY Crisis and Reform in the U.S. Health Care Delivery System FIFTH EDITION Edited by CHARLENE HARRINGTON, PhD, RN Professor of Sociology and Nursing CARROLL L. ESTES, PhD Professor of Sociology Department of Social and Behavioral Sciences School of Nursing University of California, San Francisco With assistance from BROOKE HOLLISTER HEALTH POLICY World Headquarters Jones and Bartlett Publishers 40 Tall Pine Drive Sudbury, MA 01776 978-443-5000 firstname.lastname@example.org www.jbpub.com Jones and Bartlett Publishers Canada 2406 Nikanna Road Mississauga, ON L5C 2W6 CANADA Jones and Bartlett Publishers International Barb House, Barb Mews London W6 7PA UK Copyright © 2007 by Jones and Bartlett Publishers, Inc. Cover Image © Corbis Images/PictureQuest All rights reserved. No part of the material protected by this copyright notice may be reproduced or utilized in any form, electronic or mechanical, including photocopying, recording, or any information storage or retrieval system, without written permission from the copyright owner. Library of Congress Cataloging-in-Publication Data Health policy: crisis and reform in the U.S. health care delivery system/edited by Charlene Harrington and Carroll L. Estes.¿4th ed. p.; cm. Includes bibliographical references and index. ISBN 0-7637-0753-8 1. Medical policy¿United States. 2. Health care reform¿United States. 3. Medical care¿United States. 4. Medical care¿United States¿Finance. [DNLM: 1. Delivery of Health Care¿economics¿United States. 2. Delivery of Health Care¿trends¿United States. 3. Health Policy¿United States. 4. Nursing¿United States. W 84 AA1 H43478 RA395.A3H42554 2004 362.1'0973¿dc22 2003021413 Production Credits Acquisitions Editor: Kevin Sullivan Production Manager: Amy Rose Associate Production Editor: Renée Sekerak Editorial Assistant: Amy Sibley Marketing Manager: Joy Stark-Vancs Manufacturing Buyer: Amy Bacus Composition and Art Creation: Shepherd Incorporated Cover Design: Kristin E. Ohlin Printing and Binding: Malloy, Inc. Cover Printing: Malloy, Inc. Printed in the United States of America 08 07 06 05 04 10 9 8 7 6 5 4 3 2 1 CONTENTS FOREWORD XI INTRODUCTION xiii ACKNOWLEDGMENTS xvii PART I HEALTH POLICY 1 CHAPTER 1 HEALTH POLITICS AND POLITICAL ACTION 3 HEALTH POLICY: WHAT IT IS AND HOW IT WORKS 4 Lester E. Block PLAY TO WIN: KNOW THE RULES 18 Catherine J. Dodd PRIMER ON POLICY: THE LEGISLATIVE PROCESS AT THE FEDERAL LEVEL 15 Sara Hart and Nadine Jackson IT¿S THE INSTITUTIONS STUPID 15 Sven Steinmo and Jan Watts PART II HEALTH STATUS AND ACCESS TO CARE 41 CHAPTER 2 HEALTH STATUS OF THE POPULATION AND VULNERABLE GROUPS 45 WHY NOT THE BEST? RESULTS FROM A NATIONAL SCORECARD ON U.S. HEALTH SYSTEM PERFORMANCE 46 The Commonwealth Fund Commission on a High Performance Health System HEALTH DISPARITIES BASED ON SOCIOECONOMIC INEQUALITIES: IMPLICATIONS FOR URBAN HEALTH CARE 51 Kevin Fiscella and David Williams MORTALITY OF WHITE AMERICANS, AFRICAN AMERICANS AND CANADIANS: THE CAUSES AD CONSEQUENCES FOR HEALTH OF WELFARE STATE INSTITUTIONS AND POLICIES 67 Stephen J. Kunitz and Irena Pesis-Katz THE GENDER GAP: NEW CHALLENGES IN WOMEN¿S HEALTH 59 Gloria E. Sarto CHILD POVERTY IN RICH COUNTRIES 78 United Nations International Childrens Emergency Fund CHAPTER 3 ACCESS TO CARE 83 INCOME, EARNINGS, AND POVERTY: DATA FROM THE 2005 AMERICAN COMMUNITY SURVEY 88 U.S. Census Bureau WHO ARE THE UNINSURED? 84 Kaiser Commission on Medicaid and the Uninsured ACCESS TO CARE AND UTILIZATION AMONG CHILDREN: ESTIMATING THE EFFECTS OF PUBLIC AND PRIVATE COVERAGE 100 Thomas M. Selden and Julie L. Hudson THE EFFECTS OF STATE PARITY LAWS ON THE USE OF MENTAL HEALTH CARE 94 Catherine M. Harris, Christopher Carpenter, and Yuhua Bao CHAPTER 4 AGING AND LONG-TERM CARE 113 OLDER PEOPLE 138 Carroll Estes and Steven P. Wallace MEDICARE AND CHRONIC CARE AT THE BEGINNING OF THE 21ST CENTURY: IMPROVING BUT A LONG WAY TO GO 123 Marty Lynch, Carroll Estes, and Mauro Hernandez UNMET NEED FOR PERSONAL ASSISTANCE SERVICES: ESTIMATING THE SHORTFALL IN HOURS OF HELP AN D ADVERSE CONSEQUENCES Mitchell P. LaPlante, Stephen H. Kaye, Taewoon Kang, and Charlene Harrington WOMEN¿S HEALTH AND ECONOMIC SECURITY 138 Brooke Hollister and Carroll Estes SOCIAL SECURITY PRIVATIZATION AND OLDER WOMEN: A FEMINIST POLITICAL ECONOMY PERSPECTIVE 138 Carroll Estes INFORMALIZATION OF LONG-TERM CAREGIVING: A GENDER LENS 147 Carroll L. Estes and Donna M. Zulman PART III HEALTH CARE DELIVERY SYSTEM ISSUES 157 CHAPTER 5 ORGANIZATIONAL CHANGE 161 EXPLODING THE MERGER MYTH IN U.S. HEALTH CARE 162 Martin Kitchener THE TRANSITION FROM EXCESS CAPACITY TO STRAINED CAPACITY IN U.S. HOSPITALS 174 Gloria J. Bazzoli, Linda R. Brewster, Jessica H. May, and Sylvia Kuo HEALTH INDUSTRY PRACTICES THAT CREATE CONFLICTS OF INTEREST 184 Troyen A. Brennan, David J. Rothman, Linda Blank, David Blumenthal, Susan C. Chimonas, Jordan J. Cohen, Janlori Goldman, Jerome P. Kassirer, Harry Kimball, James Naughton, and Neil Smelser THE U.S. LONG-TERM CARE FIELD: A DIALECTICAL ANALYSIS OF INSTITUTIONAL DYNAMICS 188 Martin Kitchener and Charlene Harrington PRIMARY CARE, RACE, AND MORTALITY IN U.S. STATES 188 Leiyu Shi, James Macinko, Barbara Starfield, Robert Politzer, and Jiahong Xu CHAPTER 6 LABOR ISSUES 195 FROM THE DOCTOR¿S WORKSHOP TO THE IRON CAGE? EVOLVING MODES OF PHYSICIAN CONTROL IN US HEALTH SYSTEMS 201 Martin Kitchener, Carol A. Caronna, and Stephen M. Shortell PROJECTIONS AND TRENDS IN RN SUPPLY: WHAT DO THEY TELL USE ABOUT THE NURSING SHORTAGE 201 Lynn Y. Unruh and Myron D. Fottler COSTS OF OCCUPATIONAL INJURY AND ILLNESS WITHIN THE HEALTH SERVICES SECTOR 216 Geetha Waehrer, J. Paul Leigh, and Ted R. Miller CHAPTER 7 QUALITY OF CARE 223 THE NATIONAL HEALTHCARE QUALITY AND DISPARITIES REPORTS: AN OVERVIEW 224 Ed Kelley, Ernest Moy, Daniel Stryer, Helen Burstin, and Carolyn Clancy QUALITY OF CARE IN FOR-PROFIT AND NOT-FOR-PROFIT HEALTH PLANS ENROLLING MEDICARE BENEFICIARIES 227 Eric C. Schneider, Alan M. Zaslavsky, and Arnold M. Epstein IMPROVING NURSE-TO-PATIENT STAFFING RATIOS AS A COST-EFFECTIVE SAFETY INTERVENTION 236 Michael B. Rothberg, Ivo Abraham, Peter K. Lindenauer, and David N. Rose. STATE NURSING HOME ENFORCEMENT SYSTEMS 233 Charlene Harrington, Joseph T. Mullan, and Helen Carrillo RELATIONSHIP OF NURSING HOME STAFFING TO QUALITY OF CARE 236 John F. Schnelle, Sandra F. Simmons, Charlene Harrington, Mary Cadogan, Emily Garcia, and Barbara M. Bates-Jensen INITIAL HOME HEALTH OUTCOMES UNDER PROSPECTIVE PAYMENT 236 Robert E. Schlenker, Martha C. Powell, and Glenn K. Goodrich PART IV THE ECONOMICS OF HEALTH CARE 243 CHAPTER 8 FINANCING HEALTH CARE 249 ECONOMIC ANALYSIS IN HEALTH CARE 260 Wendy Max HIGH AND RISING HEALTH CARE COSTS. PART 1: SEEKING AN EXPLANATION 271 Thomas Bodenheimer HIGH AND RISING HEALTH CARE COSTS. PART 3: THE ROLE OF HEALTH CARE PROVIDERS 271 Thomas Bodenheimer EMPLOYER HEALTH BENEFITS 277 The Kaiser Family Foundation SQUEEZED: WHY RISING EXPOSURE TO HEALTH CARE COSTS THREATENS THE HEALTH AND FINANCIAL WELL-BEING OF AMERICAN FAMILIES 324 Sara R. Collins, Jennifer L. Kriss, Karen Davis, Michelle M. Doty, and Alyssa L. Holmgren, The Commonwealth Fund CHAPTER 9 PUBLIC FINANCING 281 MEDICAID AT FORTY 282 Diane Rowland HOW WELL DOES MEDICAID WORK IN IMPROVING ACCESS TO CARE? 287 Sharon K. Long, Teresa Coughlin, and Jennifer King MEDICARE AT A GLANCE 293 The Kaiser Family Foundation ARE WOMEN BETTER OFF BECAUSE OF THE NEW MEDICARE DRUG LEGISLATION? MARILYN MOON MEDICARE AND MEDICAID: TRENDS AND ISSUES AFFECTING ACCESS TO CARE FOR LOW-INCOME ELDERS AND PEOPLE WITH DISABILITIES 29 Ellen O¿Brien PRIVATIZATION OF MEDICARE: TOWARD DISENTITLEMENT AND BETRAYAL OF A SOCIAL CONTRACT 29 John P. Geyman CHAPTER 10 PRIVATE INSURANCE AND MANAGED CARE 317 NATIONAL ESTIMATES OF THE EFFECTS OF MANDATORY MEDICAID MANAGED CARE PROGRAMS ON HEALTH CARE ACCESS AND USE, 1997-1999 318 Bowen Garrett and Stephen Zuckerman MEDICARE BENEFICIARY OUT-OF-POCKET COSTS: ARE MEDICARE ADVANTAGE PLANS A BETTER DEAL? 324 Brian Biles, Laura H. Nicholas, and Stuart Guterman, The Commonwealth Fund THE RISE AND FALL OF MANAGED CARE 332 David Mechanic COMPETITION AND HEALTH PLAN PERFORMANCE: EVIDENCE FROM HEALTH MAINTENANCE ORGANIZATION INSURANCE MARKETS 336 Dennis Scanlon, Shailender Swaminathan, Michael Chernew, James E. Bost, and John Shevock THE EFFECTS OF RECENT EMPLOYMENT CHANGES AND PREMIUM INCREASES ON ADULTS¿ INSURANCE COVERAGE 336 Jack Hadley HEALTH SAVINGS ACCOUNTS AND HIGH-DEDUCTIBLE HEALTH PLANS: WHY THEY WON¿T CURE WHAT AILS U.S. HEALTH CARE 336 Sara Collins, The Commonwealth Fund PART V REFORMING THE U.S. HEALTH CARE SYSTEM 339 CHAPTER 11 INTERNATIONAL HEALTH SYSTEMS 343 THE WORLD HEALTH SITUATION 372 Vincente Navarro HEALTH, POVERTY AND MILLENNIUM DEVELOPMENT GOALS 344 World Health Organization RISING HEALTH CARE COSTS PUT PRESSURE ON PUBLIC FINANCES 344 Organisation for Economic Co-operation and Development ACCESS TO CARE, HEALTH STATUS, AND HEALTH DISPARITIES IN THE UNITED STATES AND CANADA: RESULTS OF A CROSS-NATIONAL POPULATION-BASED SURVEY 344 Karen E. Lasser, David U. Himmelstein, and Steffie Woolhandler NHS PLC: THE PRIVATISATION OF OUR HEALTH CARE 344 Allyson M. Pollok with Colin Leys, David Price, David Rowland, and Shamini Gnani MULTINATIONAL CORPORATIONS AND HEALTH CARE IN THE UNITED STATES AND LATIN AMERICA: STRATEGIES, ACTIONS, AND EFFECTS 344 Rebeca Jasso-Aguilar, Howard Witzkin, and Angela Landwehr COMPARED TO OTHER COUNTRIES: HOW EXCEPTIONAL ARE THE HEALTH AND INCOME SECURITY ARRANGEMENTS OF THE UNITED STATES? 344 Joseph White CHAPTER 12 HEALTH REFORM FOR THE FUTURE 381 MYTHS AS BARRIERS TO HEALTH CARE REFORM IN THE UNITED STATES 29 John P. Geyman WHY CONGRESS DID NOT ENACT HEALTH CARE REFORM 36 Vincente Navarro WHY THE U.S. HAS NO NATIONAL HEALTH INSURANCE: STAKEHOLDER MOBILIZATION AGAINST THE WELFARE STATE 36 Jill Quandagno CROWD-OUT AND THE POLITICS OF HEALTH REFORM 36 Judy Feder IMPROVING MEDICAL PRACTICE AND THE ECONOMY THROUGH UNIVERSAL HEALTH CARE 36 Donald Light CONCLUSIONS 409 GLOSSARY 411 INDEX 417 FOREWORD The issues discussed in this fifth edition of Health Policy are truly the issues of the millennium, though many of them have remained the same over the years since the first edition was published. That they seem so intractable should not surprise us because views of universality, the poor, access to care and organization of care are difficult for all of the countries in the world, whether industrialized or developing. However, American¿s idiosyncratic views about money and justice, among other things, lead to ambivalence and changeability with regard to political solutions on local and national levels. There appears to be little question that the public has great concern about the current state of health care, and the flaws in current approaches. In fact, as this edition is being published there are polls that place concerns about health care at the top of American¿s priorities and there are various political approaches anticipated to quell these concerns. It is unfortunate that some of these approaches seem beneficial to much of the public but have potentially negative outcomes for costs of pharmaceuticals and for the continuing power of the private for-profit sector in dominating health care delivery. There has not been a strong national coalition behind the development of a public movement for a universal health care system. As a result of the inability to mobilize the political force of the nation at this time, there are a number of state efforts to get the question of universal care on the agenda. The value placed on quality of care and access to care by the American public has to be revealed in the voting booths. If that value is high, change is inevitable; however, if the American public is fearful of the consequences of an inclusive health care policy, decades will pass with millions of people unserved, underserved, and receiving care of questionable quality. The fifth edition of Health Policy has a few articles from the previous edition. These articles are classic in that they provide a frame of reference and backdrop for understanding the problems in the U.S. health care system and the basic health policy issues. Most articles in the volume are new, and are vital to permit us to keep up with the constantly changing issues in health policy issues at the leading edge of current discussions. Part I begins with a review of what health policy is and how the political system operates. Focusing on issues of health status of the population and vulnerable groups, Part II details issues of race, gender, and income disparities as well as discrimination. Some of the issues at the core of access are the uninsured, social inequality, mental health, aging, long term care, and end-of-life care policies. In discussing health care delivery system issues, articles in Part III deal with organizational change, labor issues, and quality of care. Mergers and restructuring, primary care, staffing issues in hospitals and nursing homes, shortages in the workforce, errors in health care, and public reporting of quality indicators are invaluable reading for health professionals on first reading and as references for repeated readings and use. Part IV of the book discusses the economics of health care with articles on public and private financing and insurance and managed care, while Part V deals with reform of the health care system in the United States. The outstanding analysts of health care systems discuss trends and systems in Canada, the United Kingdom, and other industrialized countries. In addition, definitions of health policy, failures in policy, crises in nursing caused by misapplied policy and public inaction, and finally solutions through two discussions of health reform for the future are presented. The fifth edition of Health Policy is designed for all health professionals and anyone interested in or involved in the health care field. The authors are experts in their subject matter. As a composite, the most challenging issues facing the nation are explicated. The content provides information to enrich one¿s own understanding of the specifics and generalities of the problems we Americans face in health care, it¿s present and future. It also provides the impetus for individual and collective action. Claire M. Fagin, Ph.D., FAAN INTRODUCTION This edited volume is designed for health professionals and for students of health policy and economics. Health policy and economics are constantly changing and the literature in the area is growing at an alarming pace. This makes it difficult for those learning about the area to identify the most important topics for study and the changing issues and trends. This volume attempts to identify the key issues and trends that we use in our policy courses in the Department of Social and Behavioral Sciences at the University of California, San Francisco. We have selected our favorite articles about health status and access, delivery systems, costs and economics, politics and health reform. Health policy is a new arena for many health professionals, and many realize that they must become knowledgeable in this area in order to improve health care for their patients and for the public. Health professionals working in organizations, public health, primary and specialty care, private practice, and management positions are all directly affected by the organization and financing of the health care system including the policies and politics that shape the system. Health policy does not come naturally to many health professionals who have had long and arduous clinical training focusing on caring for individuals and families. The organizational, systemic, and political issues sometimes seem too overwhelming to comprehend. Health professionals must move beyond their basic training to become more politically aware and active in shaping policy and advocating for their own interests and those of their patients. They also must move beyond clinical research into policy-relevant research, addressing the larger issues impacting their patients and the health professions. A research and policy focus on organizations, financing, and systems of care can have more impact than clinical studies. This book is designed to focus on the big picture issues and to present the viewpoints of sociologists, economists, political scientists, and health experts. The language these experts use is different and sometimes difficult, but understanding the language is essential to be able to communicate with public policy makers and health services and policy researchers. Health professionals come to the policy arena with many strengths and liabilities. Their greatest strength is that they are viewed positively by the public and the policy makers as caring providers with a real commitment to patients and the health of the public. Consequently, the public and the policy makers are willing to listen to their viewpoints on health issues. They are knowledgeable about the day-to-day problems of their patients and families and are able to present these problems in a way that the public and policy makers can understand. Moreover, health professional organizations can use their size and energy to have a major influence on policy making. In the past, health professionals have had relatively little political impact and power because they have not exercised their potential influence. Many health professionals have had little education about policy and system issues. In addition to having a wide range of political views from liberal to conservative, and affiliations from Republican, Demo¬crat, to Independent, health professionals are divided into many specialty groups and organizations with only a small percentage participating in their national organizations. They are frequently reluctant to pay membership dues and to volunteer their time and energy to do organizational work. This is understandable because health professionals are often managing jobs, families, caring for sick parents and children, and going to school, among many other day-to-day responsibilities, leaving little time for political action. As the overall job market competition intensifies, professional work pressures and stress may further reduce health professionals¿ participation in professional and political organizations. This book is designed to persuade health professionals that they need to add political work to their lives. The strength to influence health policy can only come when health professionals are better informed about policy, economics, and politics and by uniting behind some common goals. In order to be effective, political and professional actions should be undertaken through organizations rather than as individual health professionals. Enthusiasm for specialty organizations should not divert health professionals from participation in the local, state, and national organizations that address the broader issues of the health profession. This book focuses on the important policy issues of our times. It attempts to arm health professionals with facts about the system and the names of key policy shapers. Because health care statistics are updated frequently, it is important not to memorize facts but to learn the most important sources for information so that current information can be retrieved when needed. We also attempt to show trends that tend to move forward until public policy changes or private system changes are made. Public policies are the public actions that can be taken by policy makers at the federal, state, and local levels. These actions can include budgetary changes, legislative changes, regulatory changes, and often judicial rulings. Before health professionals can advocate for public policy changes, they need a clear understanding of the current federal policies that are impacting the health system and how the system operates, including the financial incentives that influence health providers and organizations. Part I of the book begins with the understanding health policy and the political process. The vested interests in and politics of the failure of President Clinton¿s health plan are examined, as well as the potential role of health professionals in changing the health system. Part II examines the health status of the U.S. population, examining health disparities and discrimination among different population groups, including issues of access to care, aging, disability, and long-term care. The overall poor health status of the U.S. population is, in part, the result of limited access to services, especially for the poor, uninsured, and vulnerable populations. Part III discusses dramatic changes occurring in the health care delivery system and in organizations, including labor issues and quality of care. Part IV focuses on how economics drives the entire health system in the United States and impacts the day-to-day operations of health care organizations and professionals. Trends in financing health care services and the health industry are described, including the growth in public financing of Medicare and Medicaid and private financing. Private insurance and managed care are emphasized because of the rapid shift to managed care. Part V, the final section of the book, is dedicated to health care reform. Articles examine health systems in other countries, particularly in Canada, as potential models for the United States. Finally, a vision for the future of health-care reform is presented. This book is not designed to represent a broad spectrum of political ideas but rather the perspectives of expert health services researchers as well as policy leaders who are consumer-oriented and advocates for health reform. Most articles are critical of the existing health care system and hold the underlying assumption that changes in the system are needed. The status quo of millions of individuals in the United States continuing without access to health insurance, and millions of women and children with unacceptably poor health status must be corrected. To this end, reform is needed, and yet a consensus has not emerged among health professionals and the public about how such reform should be accomplished. We show the urgent need for reform and urge health professionals to become politically active using their political power and influence. Although the political problems of our health care system seem overwhelming, the system can be changed if we develop an understanding of the underlying problems and can unite behind reform strategies. The failed efforts of health reform in the early 1990s can be corrected in the coming decade. ACKNOWLEDGMENTS We would like to thank Brooke Hollister, doctoral student in Sociology at the University of California, San Francisco, for her extensive work in identifying and collecting the articles, editing the articles, and obtaining the permissions for this edition. We would also like to thank ---- for their editorial assistance.
Library of Congress Subject Headings for this publication:
Medical policy -- United States.
Health care reform -- United States.
Medical care -- United States -- Finance.
Delivery of Health Care -- economics -- United States.
Delivery of Health Care -- trends -- United States.
Health Care Reform -- United States.
Health Policy -- United States.
Health Services Accessibility -- United States.