Health Economics, Healthcare Finance, and Health Policy: What Every Student Needs to Know About the

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Health Economics, Healthcare Finance, and Health
Policy What Every Student Needs to Know About
the Health Care Field Before Entering It!
Howard P. Forman Department of Diagnostic
Radiology, Yale School of Medicine Yale School of
Management Yale School of Public
Health Department of Economics, Yale
College Howard.Forman_at_Yale.edu
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Agenda

• Why is this important?
• Key Issues in US Healthcare today
• Key Crises, Globally
• What is the current political healthcare agenda?
• What key facts should students be familiar with?
• Questions and Discussion

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Why is this important?

• Interviewers will ask questions for a host of
  reasons
• Uninformed, or unsophisticated, answers are
  increasingly hard to defend
• Need to have some substantive understanding of
  the healthcare climate and basic economics
• Making a decision to practice medicine without
  understanding some of the basics of health
  services and health economics is dangerous!

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Key Domestic Issues

• 46 million people are uninsured and another 30
  million are under-insured
• As healthcare gets more expensive, more people
  are left behind
• Medicare Under-funded and getting more costly
• Medicaid and SCHIP reliant on States Budgets
• New Healthcare Threats
• Managing epidemics particularly a true flu
  pandemic
• Our country has become much more efficient in
  delivering healthcare, but one of the costs is
  capacity
• Globally global warming may mean worsening
  malaria, etc.
• Moral/Ethical Issues Cloning, Stem Cells
• Torts Malpractice Costs

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Health Care Spending (NHE) 2006Highlights

• 2.1 Trillion up by 6.7 from prior year. 7,026
  per capita up by 5.7
• GDP (nominal) growth 6.1
• 16 of GDP (highest ever, grew by 0.1 this
  year) Healthcare, as percent of GDP, has been
  growing since 1997, after a slight decline during
  the mid 1990s
• Private spending grew at a 5.4 rate and public
  spending at 8.2 (46.1 of NHE are PUBLIC up
  from 43.9 in 1999)
• Public Expenditures (per capita)
• Overall 3238
• Federal 2358
• State and Local 888
• Total U.K. (Public and Private) 3000 (2003
  data was 2317)

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Medicare (Total) Highlights TR 2008

• 44.1 million people (36.9 M aged 7.2 M disabled)
  
• Total Benefits - 425 Billion
• Total Expenditures - 432 Billion
• Total Income - 462 Billion
• Total Assets - 369 Billion

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HI-Medicare Part A

• Hospice care (since 1982)
• Inpatient Hospital services
• Skilled nursing facility care (after a 3 day
  hospital stay)
• Why?
• Who (what?) pays for the majority of SNF bed-days
  in this country?
• 22 of beneficiaries actually received HI
  services in 2002 (slight increase from 1993, when
  figure was 20)
• Average expenditure per enrollee 4573 (2007)

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TR, 2008
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Medicare Part B - Supplemental Medical Insurance

• Physician services
• Home Healthcare
• Durable medical equipment (DME)
• Outpatient medical services
• Clinical lab tests Imaging
• PT/OT
• Emergency Room service
• Ambulance
• Hep B, Flu, Pneumococcal vaccines
• Screening Pap smear, mammography, colon
  cholesterol Diabetes Glaucoma Prostate cancer
• Prescription drugs which can not be
  self-administered including certain anti-cancer
  drugs

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TR, 2008
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TR, 2008
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Key Global Crises

• HIV (and other infectious diseases) in Lesser
  Developed Nations
• Global warming and malaria
• Infrastructure
• Starvation and Diarrheal Diseases in Children
• Affording healthcare/prescription drugs

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http//www.gapminder.org/world
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Current Domestic Healthcare Agenda

• Medicare reform Constant What does it mean?
• Medicare Prescription Drug Benefit
• Uninsured Problem Immigration issues
• SCHIP reauthorization - top issue for next year
  ties in with uninsured
• Presidential election highlights problems with
  market-based healthcare delivery
• Mental healthcare parity improving prospects

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Key Issues to be aware of

• What is Medicare, Medicaid, SCHIP?
• Bonus points for Medicare parts A, B, C, and D
• Bonus points for understanding funding of any of
  this..
• How much does our nation spend on healthcare? How
  much is too much? How does this compare to other
  nations?
• What is Universal Health Coverage (Insurance)?
  (Why should you not discuss this topic without
  very very serious thought, in advance)?
• Disparities in healthcare, health services, and
  health
• Ethnic, racial, economic

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Questions?