The Nature of Federal Policy

1. The Nature of Federal Policy • The course of action taken by the federal government • Embodies principles derived from the federal Constitution • Defines practices and programs, consonant with those principles, that are viewed as appropriate to ensure those principles are realized • Principles and practices are defined in • Legislation • Regulation • Judicial opinions

2. Health Policy • Should every individual in the United States have access to “quality” “affordable” health care? What does “quality” and “affordable” mean • How should such access be ensured? • What role should the federal government play?

3. The Patient Protection and Affordable Care Act March 23, 2010 (P.L. 111-148) • The Patient Protection and Affordable Care Act(Opencongress.org) • Expand health care coverage to 31 million currently uninsured Americans through a combination of cost controls, subsidies and mandates • Estimated to cost $848 billion over a 10 year period, but would be fully offset by new taxes and revenues and would actually reduce the deficit by $131 billion over the same period • Democratic Policy Committee has posted a summary and more information about the bill • The Republicans have posted their own summary here

4. Health Care and Education Affordability Reconciliation Act of 2010 March 30, 2010 (P.L. 111-152) • Made changes to The Patient Protection and Affordable Care Act enacted • H.R.4872 - Health Care and Education Affordability Reconciliation Act of 2010 (Opencongress.org) • Health Care and Education Reconciliation Act (Wikipedia) • Full text (Radioviceonline.com)

5. Affordable Health Care for America: Reconciliation Bill (House Committee on Education and Labor) • What’s in the Health Care bill? (White House blog, March 23, 2010) • Health Care Reform bill (CBS News, March 21, 2010) • President signs the Health Care and Education Reconciliation Act (White House blog) • Health care reform (Deloitte) • Researching Health Policy Legislation (Columbia University Libraries)

6. Social Security • Refers to a variety of programs stemming from the original Social Security Act enacted in 1935 • Social Security statutes (Social Security Administration) • Federal Old-Age, Survivors, and Disability Insurance (Pensions) • Unemployment benefits • Temporary Assistance for Needy Families • Health Insurance for Aged and Disabled (Medicare) • Grants to States for Medical Assistance Programs (Medicaid) • State Children's Health Insurance Program (SCHIP) • Supplemental Security Income (SSI)

7. A Short History of Health Care (Slate.com) • Historical Highlights of Federal Involvement (Department of Health and Human Services) • History of health Insurance (Neurosurgical.com) • Health care provided by many separate legal entities • Facilities owned and operated by the private sector • Health insurance is primarily provided and financed the private sector, • Programs such as Medicare, Medicaid, TRICARE, the Children's Health Insurance Program public finance • Veterans Health Administration – public programs and public finance

8. Typology of Health Care?Role of government? • Role of government? • as provider • as guarantor of funds to provider

9. At least 15.3% of the population is completely uninsured • Perhaps 35% is “underinsured”- not able to cover the costs of their medical needs • More money per person is spent on health care in the United States than in any other nation in the world • Greater percentage of total income in the nation is spent on health care in the U.S. than in any United Nations member state except for East Timor • Despite the fact that not all citizens are covered, the United States has the third highest public healthcare expenditure per capita • A 2001 study in five states found that medical debt contributed to 62% of all personal bankruptcies • Since then, health costs and the numbers of uninsured and underinsured have increased

10. The US pays twice as much yet lags behind other wealthy nations in such measures as infant mortality and life expectancy • Currently, the U.S. has a higher infant mortality rate than most of the world's industrialized nations • The United States life expectancy 42nd in the world • Debate about health care reform in the United States concerned the questions of • a right to health care • access • fairness • efficiency • cost • quality

11. USAspending.gov The Federal Funding Accountability and Transparency Act of 2006 (Transparency Act) requires a single searchable website, accessible by the public for free that includes details about each Federal award • Catalog of Domestic Federal Assistance • Grants.gov HHS and other federal agencies provide grants, benefit programs for individuals and families, loans, and contracting opportunities. • HHS grants

12. Government spending on health care • Direct assistance • Aid to individuals for care • Agencies providing care • Research and development – loans and grants to nonprofit sector • Regulatory control over safety of facilities and health care providers • Regulatory control over safety and efficacy of products and practices – drugs and medical devices • Regulatory control over insurance industry

13. Department of Health and Human Services • Federal government's principal agency for protecting the health of all Americans and providing essential human services, especially for those who are least able to help themselves • ACF – Administration for Children & Families • AoA – Administration on Aging • AHRQ – Agency for Healthcare Research & Quality • ATSDR – Agency for Toxic Substances & Disease • CDC – Centers for Disease Control & Prevention • CMS – Centers for Medicare & Medicaid Services • FDA – Food & Drug Administration • HRSA – Health Resources & Services Administration • IHS – Indian Health Service • NIH – National Institutes of Health • OIG – Office of Inspector General • SAMHSA – Substance Abuse & Mental Health Services Administration

14. Regulations • Regulations implement statutes and provides guidance to industry, state and local governments, and other organizations • Health Information Privacy (HIPAA) The Privacy Rule provides federal protections for personal health information held by covered entities and gives patients an array of rights with respect to that information – balances the need for disclosing personal health information needed for patient care with the right to privacy • Human Research Protections – Office for Human Research Protections • Health Information Technology Standards – electronic health records

15. Office of Rural Health Policy (Department of Health and Human Services) • Coordinates activities related to rural health care within the U.S. Department of Health and Human Services • Part of the Health Resources and Services Administration (HRSA), ORHP has department-wide responsibility for analyzing the possible effects of policy on 62 million residents of rural communities  • Created by Section 711 of the Social Security Act, ORHP advises the Secretary on health issues within these communities, including • the effects of Medicare and Medicaid on rural citizens’ access to care • the viability of rural hospitals • the availability of physicians and other health professionals

16. Financing Health Care • five primary methods of funding health care systems • direct or out-of-pocket payments • general taxation to the state, county, or municipality • social health insurance • voluntary or private health insurance • donations or community health insurance

17. Health Insurance Major federal laws regulating the insurance industry include COBRA and HIPAA

18. Doctors and hospitals are generally funded either by payments from patients and insurance plans in return for services rendered • 84.7% of citizens have some form of health insurance • 59.3% through their employer or the employer of their spouse or parent • 8.9% purchased individually • 27.8% provided by government programs with restricted eligibility • Americans without health insurance coverage at some time during 2007 totaled about 15.3% of the population, or 45.7 million people • Insurance for dental and vision care (except for visits to ophthalmologists, which are covered by regular health insurance) is usually sold separately. • Prescription drugs are often handled differently than medical services, including by the government programs.

19. Employer Paid Health Care • 65% of the non-elderly population and over 90% of the privately insured non-elderly population receives health insurance at the workplace • Employer-sponsored health benefits are exempt from federal income and payroll taxes – employees pay no taxes on them • The value of the lost tax revenue from a benefits in kind tax is an estimated $150 billion a year • Those buying insurance in the individual market must pay from income received after tax • Such tax benefits are an attractive way for employers to increase the compensation of employees • Tax shelter increases individual demand for health insurance, leading some to claim that it is largely responsible for the rise in health care spending • In addition the government allows full tax shelter at the highest marginal rate to investors in Health Savings Accounts

20. Facilities • Non-profit hospitals which are organized as non-profit corporations, many based on their charitable purpose and most often affiliated with a religious denomination – about 62% of the national capacity • (Privately owned for-profit) Investor-owned hospitals – Hospital Corporation of America • Government hospitals. • Department of Defense operates field hospitals as well as permanent hospitals (the Military Health System), to provide military-funded care to active military personnel • Veterans Health Administration operates VA hospitals open only to veterans • Indian Health Service operates facilities open only to Native Americans from recognized tribes

21. Hospitals provide some outpatient care in their emergency rooms and specialty clinics, but primarily exist to provide inpatient care • Hospital emergency departments and urgent care centers are sources of sporadic problem-focused care • "Surgicenters" are examples of specialty clinics • Hospice services for the terminally ill who are expected to live six months or less are most commonly subsidized by charities and government • Prenatal, family planning, and "dysplasia" clinics are government-funded obstetric and gynecologic specialty clinics respectively, and are usually staffed by nurse practitioners

22. Medical Products – Drugs • Production of pharmaceuticals - chemicals intended to diagnose, cure, treat, or prevent disease - carried out by private companies • Classification (Wikipedia) • Food and Drug Administration • Generic drugs (Wikipedia) • U.S. Patent Office

23. Medical Products – Medical devices • Products used to diagnose an illness, in surgery, to provide therapy • According to the U.S. Food and Drug Administration a medical device is an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including a component part, or accessory • recognized in the official National Formulary, or the United States Pharmacopoeia, or any supplement to them • intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in human or other animals, or • intended to affect the structure or any function of the body of man or other animals, and which does not achieve any of its primary intended purposes through chemical action within or on the body of man or other animals and which is not dependent upon being metabolized for the achievement of any of its primary intended purposes. • Defined by the Federal Food, Drug, and Cosmetic Act, 21 United States Code [321] (h) • Medical devices are regulated by the FDA Center for Devices and Radiological Health

24. The research and development of medical devices and pharmaceuticals is supported by both public and private sources of funding • In 2003, research and development expenditures were approximately $95 billion with $40 billion coming from public sources and $55 billion coming from private sources • These investments into medical research have made the United States the leader in medical innovation, measured either in terms of revenue or the number of new drugs and devices introduced • In 2006, the United States accounted for three quarters of the world’s biotechnology revenues and 82% of world R&D spending in biotechnology • According to multiple international pharmaceutical trade groups, the high profits resulting from patented drug sales in the U.S. have encouraged substantial reinvestment in such research and development.

25. Emergency Care • The Emergency Medical Treatment and Active Labor Act requires virtually all hospitals to accept all patients, regardless of the ability to pay, for emergency room care • The act does not provide access to non-emergency room care for patients who cannot afford to pay for health care, nor does it provide the benefit of preventive care and the continuity of a primary care physician • Emergency health care is generally more expensive than an urgent care clinic or a doctor's office visit, especially if a condition has worsened due to putting off needed care • Emergency rooms are typically at, near, or over capacity • Long wait times have become a problem nationally, and in urban areas some ERs are put on "diversion" on a regular basis, meaning that ambulances are directed to bring patients elsewhere

26. Public • Public spending 45% - 56.1% of U.S. health care spending • Government programs cover 27.8% of the population (83 million) • Medicare, generally covering citizens and long-term residents 65 years and older and the disabled, provided health care coverage for 41.4 million elderly and disabled Americans 2007 -expected to reach 77 million by 2031, when the baby boom generation is fully enrolled • number of physicians accepting Medicaid has decreased in recent years due to relatively high administrative costs and low reimbursements • Medicaid, generally covering low income people in certain categories, including children, pregnant women, and the disabled. (Administered by the states.) provided health care coverage for 39.6 million low-income Americans 2007 • State Children's Health Insurance Program, which provides health insurance for low-income children who do not qualify for Medicaid. (Administered by the states, with matching state funds.) • The Veterans Administration, which provides care to veterans, their families, and survivors through medical centers and clinics • TRICARE for military personnel (for use in civilian facilities)

27. There are also various state and local programs for the poor. • In 1997, the federal government also created the State Children's Health Insurance Program (SCHIP), a joint federal-state program to insure children in families that earn too much to qualify for Medicaid but cannot afford health insurance.[79] SCHIP covered 6.6 million children in 2006,[80] but the program is already facing funding shortfalls in many states.[81] The government has also mandated access to emergency care regardless of insurance status and ability to pay through the Emergency Medical Treatment and Labor Act (EMTALA), passed in 1986,[82] but EMTALA is an unfunded mandate.[83]

28. Massachusetts has adopted a universal health care system through the Massachusetts 2006 Health Reform Statute • mandates that all residents who can afford to do so purchase health insurance and provides subsidized insurance plans so that nearly everyone can afford health insurance • provides a "Health Safety Net Fund" to pay for necessary treatment for those who cannot find affordable health insurance or are not eligible

29. What do we want the federal government to do? • How do we want to pay for what we want the federal government to do?