The US health care system consists of a multitude of subsystems with significant variation between states. There is no universal health care coverage, and a significant number of individuals do not have health insurance. Health insurance can be funded by the state (e.g., Medicare), employers, individuals, or a combination thereof.
Government-funded health insurance
- Subdivided into 4 parts: Which parts individuals qualify for determines the extent of coverage.
- Part A: hospital care, for terminal patients, skilled nursing facility care (if services are needed daily after a minimum 3-day stay in a hospital)
- Part B: doctor’s fees; , emergency department visits, diagnostic tests, rehabilitation
- Part C: all services covered by parts A and B, including preventive care
- Part D: prescription drugs
- Jointly funded by the state and federal governments
- Eligibility: individuals with low income
- Coverage: hospital care, laboratory tests, diagnostic tests (such as x-rays), doctors' visits, skilled nursing care, vaccinations, home health care
Eligibility: uninsured children of families with low income, but not low enough to qualify for Medicaid
- Used by more than half of the American population
- It can be employer-sponsored (most common) , college-sponsored, or purchased individually.
- Health care providers are compensated for each individual service provided (e.g., individual laboratory tests, imaging studies, and procedures).
- Incentivizes health care providers to overtreat patients because compensation is based on the quantity of services provided
- Associated with high overall health care costs
- A fixed payment schedule with discounted prices can be negotiated between health care providers and payers (i.e., discounted fee-for-service).
- A health care organization is compensated a fixed amount for all services provided for a clinically-defined episode of care (e.g., , ). Payment is then distributed to the health care providers.
- Incentivizes health care providers to deliver efficient care (e.g., health care providers avoid unnecessary procedures)
- Carries the risk that patients will be undertreated because compensation does not rely on the quantity or quality of services provided for each clinically-defined episode of care
- Health care providers are compensated a fixed amount per patient during each payment period, regardless of the actual amount of health care utilized by the patient.
- Incentivizes health care providers to deliver efficient care (e.g., cost-effective preventive health care to avoid larger downstream costs)
- Carries the risk that patients will be undertreated because compensation is not based on the quantity or quality of services provided
Per diem payment
- A health care organization is compensated a fixed amount per patient per day for a specific care service provided, regardless of the actual costs involved in providing services for any particular patient.
- Often used for reimbursement of inpatient services
|Common health insurance plans||Health care delivered through||Coverage||Specialist care||Member costs|
|Health maintenance organization (HMO)|| || || || |
|Preferred provider organization (PPO)|| || || || |
|Point-of-service (POS)|| || || || |
|Exclusive provider organization|| || || || |