Healthcare Ecosystems Task 2

Topics: Health care, Health insurance, Medicare Pages: 8 (1622 words) Published: December 7, 2014

Healthcare Ecosystems Influence by Government Regulations, Legislation, And Accreditation Standards
Iona R. Heffley
Western Governors University




Healthcare Ecosystems Influence by Government Regulations, Legislation, And Accreditation Standards
Medicare is a national government-sponsored insurance program in the United States. Created by Congress in 1965, under President Lyndon B. Johnson, Medicare guarantees access to health insurance for Americans that are aged 65 and over and younger people with disabilities. It was the primary payer for an estimated 15.3 million inpatient stays in 2011, representing 47.2 percent ($182.7 billion) of total aggregate inpatient hospital costs in the United States (Torio & Andrews, 2013). Medicare is a single-payer health care program, meaning that a segment of the population has its resources pooled into a fund that pays medical fees.

The continuing efforts of government payers to contain hospital costs has been a concern to hospitals that serving publicly insured patients may affect their ability to manage their revenue cycle successfully (Rauscher & Wheeler, 2010). This paper analyzes the impact of Medicare on the economics of healthcare.

Medicare’s Impact on Today’s Healthcare Ecosystem
Medicare has four parts: Part A is Hospital Insurance, covering inpatient hospital stays, hospice, home health care and skilled nursing facilities. There is no premium, but there are some copayments and a yearly deductible. Part B is Medical Insurance, covering doctor services, outpatient care and some preventive services, among others. This is optional and there is a monthly premium and an annual deductible. Part C refers to two types of health plans. One is branded as “Medicare Advantage”, where participants can choose to receive Medicare Parts A and B through an approved private insurance company under Part C. The other health plan is “Medigap”, a type of supplement to Medicare, which may help pay copayments, deductibles and services not covered by Medicare. Part D is an optional prescription drug plan. It is offered through insurance companies and other private companies. There is



a monthly premium, a yearly deductible, and a co-payment. All Medicare benefits are subject to medical necessity.
Licensure, Certification, and Accreditation Standard of Medicare Centers for Medicare & Medicaid Services (CMS) developed Conditions of Participation (CoPs) that health care organizations must meet in order to begin and continue participating in the Medicare and Medicaid programs. CMS ensures that the standards of accrediting organizations they recognize meet or exceed the Medicare standards set forth in the CoPs. Currently there are seven national accreditation organizations (AOs) that offer accreditation programs that are recognized by CMS for purposes of certifying the compliance of almost 7,000 hospitals, critical access hospitals, ambulatory surgical centers, home health agencies, and hospices with Medicare health and safety standards (CMS, 2008). CMS (2012) revised the requirements that hospitals and critical access hospitals (CAHs) must meet to participate in the Medicare and Medicaid programs. This final rule is an effort to reduce procedural burdens on providers. These changes were established as an effort to comply with the general principles of the President’s Executive Order 13563, released January 18, 2011, entitled “Improving Regulation and Regulatory Review.” (as cited in CMS, 2012). The President directed each executive agency to reduce outmoded or unnecessarily burdensome rules to increase the ability of hospitals and CAHs to devote resources to providing high quality patient care (CMS, 2012). Medicare Influence on Clinical Quality

CMS (2013) has a Physician Quality Reporting System (PQRS) in place to encourage eligible health care professionals (EPs) to...

References: Budget of the United States Government. (2009). Updated Summary Tables, May, 2009, Budget of the
United States Government, Fiscal Year 2010
Burning Glass Technologies. (2012). A Growing Jobs Sector: Health Informatics. Boston: Jobs for the
hospital and critial access hospital conditions of participation. Final rule. Federal Register,
77(95), 29034-76.
Centers for Medicare & Medicaid Services (CMS). (2013, November 27). Changes for Calendar Year
2014 Physician Quality Programs and the Value Based Payment Modifier Retrieved 8 17, 2014, from
Rauscher, S., & Wheeler, J. R. (2010). Hospital Revenue Cycle Management and Payer Mix: Do
Medicare and Medicaid Undermine Hospitals ' Ability to Generate and Collect Patient Care
Torio, C. M., & Andrews, R. M. (2013, August). National Inpatient Hospital Costs: The Most Expensive
Conditions by Payer, 2011
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