J
James R. Knickman
Brian Elbel
Editors
Jonas & Kovner’s
Health Care
Delivery in the
United States
12th Edition
Knickman
h
on
H U
Copyright 2019. Springer Publishing Company.
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BRIEF CONTENTS
PART I HEALTH POLICY
CHAPTER 1 The Challenge of Health Care Delivery and Health Policy 3
CHAPTER 2 Organization of Care 15
CHAPTER 3 The Politics of Health Care in the United States 51
CHAPTER 4 Comparative Health Systems 73
PART II KEEPING AMERICANS HEALTHY
CHAPTER 5 Population Health 101
CHAPTER 6 Public Health: A Transformation in the 21st Century 123
CHAPTER 7 Health and Behavior 151
CHAPTER 8 Vulnerable Populations: Meeting the Health Needs of Populations
Facing Health Inequities 183

CHAPTER 9 The Health Workforce 231
CHAPTER 10 Health Care Financing 257
CHAPTER 11 Health Care Costs and Value 277
CHAPTER 12 High-Quality Health Care 311
CHAPTER 13 Health Care Management 343
CHAPTER 14 Health Information Technology 357
PART IV FUTURE OF U.S. HEALTH CARE

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Jonas & Kovner’s
HEALTH CARE DELIVERY
IN THE UNITED STATES
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James R. Knickman, PhD, is the Robert Derzon Chair in Public and Health A!airs
at New York University with joint appointments at the NYU Wagner School of
Public Service and at NYU Langone Medical School’s Department of Population
Health. He has spent four decades splitting his time between academe and the
philanthropic sector. His work focuses on health policy and he has played many
roles both as a researcher and a leader in philanthropy to advance the use of public policy to improve the American health care system. He was a Vice President
at the Robert Wood Johnson Foundation and President of the New York State
Health Foundation. He has a PhD in Public Policy Analysis from the University of
Pennsylvania and did his undergraduate work at Fordham University. He serves
on the Board of Directors at three non-pro”t organizations, including chairing
the National Council on Aging.
Brian Elbel, PhD, MPH, is an associate professor of Population Health and Health
Policy at the New York University School of Medicine, where he heads the Section
on Health Choice, Policy and Evaluation within the Department of Population
Health, and at the NYU Wagner Graduate School of Public Service. He is the
Assistant Dean for Strategic Initiatives in the O#ce of Science and Research of
NYU Langone Health and the Director of the NYU Langone Comprehensive
Program on Obesity. He studies how individuals make decisions that in$uence
their health, with a particular emphasis on evaluation, obesity, and food choice.
His work uses behavioral economics to understand health decision-making
among vulnerable groups, and the role and in$uence of public policy on these
decisions. His research has been funded by the National Institutes of Health,
Centers for Disease Control and Prevention, the National Science Foundation
and the Robert Wood Johnson Foundation and has been featured in national television, radio, and print media. Dr. Elbel earned his bachelor’s degree from %e
University of Texas at Austin and his master’s and doctorate in Health Policy/
Health Economics from Yale University.
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Jonas & Kovner’s
HEALTH CARE DELIVERY
IN THE UNITED STATES
12th Edition
EDITORS
JAMES R. KNICKMAN, PhD
BRIAN ELBEL, PhD, MPH
FOUNDING EDITOR
STEVEN JONAS, MD, MPH, MS, FNYAS
Copyright 2019. Springer Publishing Company.
All rights reserved. May not be reproduced in any form without permission from the publisher, except fair uses permitted under U.S. or applicable copyright law.
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CONTENTS
List of Features xiii
Foreword by Anthony R. Kovner, PhD xvii
Acknowledgments xix
Organization of This Book xxi
Contributors xxiii
PART I HEALTH POLICY
Chapter 1 The Challenge of Health Care Delivery and Health Policy 3
Brian Elbel and James R. Knickman
Introduction 4
!e Importance of Good Health to American Life 5
De”ning Characteristics of the U.S. Health System 6
Major Issues and Concerns 8
Key Stakeholders In#uencing the Health System 9
Organization of !is Book 12
Conclusion 13
Case Exercise—Health Care Delivery Plan 13
Discussion Questions 13
Reference 14
Chapter 2 Organization of Care 15
Amy Yarbrough Landry and Cathleen O. Erwin
Introduction 17
Description of the Current Care Delivery System 17
!e Future of the Delivery System 39
Best Practices 45
Conclusion 46
Case Exercise—Innovative Ideas 47
Discussion Questions 47
References 48
Chapter 3 The Politics of Health Care in the United States 51
Rogan Kersh and James Morone
Introduction 52
Health Care Infrastructure and Spending: Many Dollars, to What E$ect? 53
Who Pays? !e Politics of Medicare, Medicaid, and Much More 60
!e Politics of Providing Equitable Health Services 65
How Personal Health Decisions Become Public: !e Case of Obesity 67
Conclusion: Better National Health Ahead? 69
Case Exercise—Insurance Plans 70
Discussion Questions 70
References 70
Share Jonas & Kovner’s: Health Care Delivery in the United States, 12th Edition
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viii Contents
Chapter 4 Comparative Health Systems 73
Michael K. Gusmano and Victor G. Rodwin
Introduction 74
Health System Models 75
NHS and NHI Systems Compared With the United States 78
!e Health Systems in England, Canada, France, and China 79
Lessons 93
Case Exercise—European Lessons Learned 94
Discussion Questions 94
References 95
PART II KEEPING AMERICANS HEALTHY
Chapter 5 Population Health 101
Pamela G. Russo and Marc N. Gourevitch
Introduction 102
!e Population Health Model 103
!e Medical Model 104
Comparing the Medical and Population Health Models 106
!e In”uence of Social Determinants on Health Behavior and Outcomes 108
Leading Determinants of Health: Weighting the Di#erent Domains 112
Health Policy and Returns on Investment 115
Conclusion 118
Case Exercise—Sodium and its E#ects on Our Health 120
Discussion Questions 120
References 121
Chapter 6 Public Health: A Transformation in the 21st Century 123
Laura C. Leviton, Paul L. Kuehnert, and Kathryn E. Wehr
Overview of a Complex Infrastructure 124
Public Health Requires a Collective Response from Society 128
Public Health is Di#erent from Individual Health Care 130
!e Core Functions of Public Health De$ne Essential Public Health Activities 132
Governmental Agencies Have Legal Authority for the Core Functions 135
Social, Economic, and Political Forces are Transforming Public Health 140
Conclusion 146
Case Exercise—Cure For Birth Defects Policy Options 146
Discussion Questions 146
References 147
Chapter 7 Health and Behavior 151
Brian Elbel, Elaine F. Cassidy, Matthew D. Trujillo, and C. Tracy Orleans
Introduction 152
Behavioral Risk Factors: Overview and National Goals 153
Changing Health Behavior: Closing the Gap Between Recommended and Actual Health
Lifestyle Practices 159
!e Role and Impact of Primary Care Interventions 163
Multilevel Models For Population-Based Health Behavior Change 166
Changing Provider Behavior: Closing the Gap Between Best Practice and Usual Care 171
Conclusion 177
Case Exercise—Comprehensive Plan for Addressing Risk Factors 178
Discussion Questions 178
References 179
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Contents ix
Chapter 8 Vulnerable Populations: Meeting the Health Needs of Populations Facing
Health Inequities 183
Monique J. Vasquez, Jacqueline Martinez Garcel, Elizabeth A. Ward, and
Lourdes J. Rodríguez
Introduction 184
Understanding Factors and Systems that Impact People Disproportionately A!ected by
Health Inequities 186
“e Growing Number of Health Inequities 192
Uneven Footing After the Great Recession and a Strained Social Service Sector 198
Organization and Financing of Health Care, Population/Public Health/Prevention, and
Other Services for Populations Experiencing Health Inequities 199
Rural Health Clinics and Rural Health Networks 201
Social Service Needs 203
Federal and State Financing of Care for Vulnerable Populations 206
Challenges for Service Delivery and Payment 208
Emerging and Tested Ideas for Better Health Delivery 210
Case Exercise 8.1—Patient Engagement: Bronx-Lebanon Hospital Department of Family
Medicine’s Patient-Centered Medical Home 213
Case Exercise 8.2—Integrated Care: Camden Coalition of Health Care Providers 213
Opportunities in the ACA to Meet Health Care Needs of Vulnerable Populations 214
Conclusion 219
Case Exercise 8.3—Plan for Refugees 220
Discussion Questions 220
References 221

Chapter 9 The Health Workforce 231
Joanne Spetz and Susan A. Chapman
Introduction 232
Who Is Part of the Health Workforce? 232
Traditional Approaches to Health Workforce Planning 234
Health Workforce Education 235
Critical Issues for the Health Workforce 240
Conclusion: Building the Future Health Care Workforce 248
Case Exercise—Workforce Recruitment Plan 248
Discussion Questions 248
References 249
Chapter 10 Health Care Financing 257
James R. Knickman
Introduction 258
General Overview of Health Care Financing 259
What the Money Buys and Where It Comes From 262
How Health Insurance Works 262
How Providers are Paid for the Health Services “ey Deliver 267
Specialized Payment Approaches Used by Payers 269
Conclusion 273
Case Exercise—Becoming an Accountable Care Organization Versus Not Becoming an
Accountable Care Organization 274
Discussion Questions 274
References 274
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x Contents
Chapter 11 Health Care Costs and Value 277
David C. Radley and John Marchica
Introduction 278
Spending Levels and Cost Growth 278
De!ning and Measuring Value in Health Care 284
Cost Drivers and Barriers to Value 286
Initiatives to Address Expenditure/Value Tradeo”s 294
Delivery System Reform 298
State-Driven Value-Based Initiatives 303
Conclusion 304
Case Exercise—Monitoring of Value 305
Discussion Questions 305
References 306
Chapter 12 High-Quality Health Care 311
Carolyn M. Clancy and Irene Fraser
Introduction 312
De!ning Quality 312
How are We Doing? 313
How Do We Improve Quality? 314
How Do We Incentivize Quality Care? 322
What are Major Recent Developments A”ecting Quality? 332
Core Competencies for Health Administrators 336
Conclusion 338
Case Exercise—Using Data to Support Sustainability 338
Discussion Questions 339
References 340
Chapter 13 Health Care Management 343
Anthony R. Kovner and Christy Harris Lemak
Introduction 344
Governance, Performance and Accountability 344
#e Complex Tasks of Leadership and Management 348
Evidence-Based Management 351
Challenges Managers Face 352
Conclusion 354
Case Exercise—Strategic Plan Report 355
Discussion Questions 355
References 355
Chapter 14 Health Information Technology 357
Karen B. DeSalvo and Y. Claire Wang
Introduction 358
Health Data Needs and IT Use Cases 359
Case Exercise 14.1—NYC Macroscope 364
HIT Interoperability 365
Standards 367
Driving Forces Shaping the Use of Data and HIT 367
Case Exercise 14.2—Avera Health 370
Challenges to More E”ective Use of Information and Data 370
Privacy and Security 371
Current Marketplace and Emerging Opportunities 372
Conclusion 374
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Contents xi
Case Exercise 14.3—Electronic Health Records 374
Discussion Questions 374
References 375
PART IV FUTURE OF U.S. HEALTH CARE
Chapter 15 The Future of Health Care Delivery and Health Policy 381
James R. Knickman and Brian Elbel
Introduction 382
Forces Shaping Change in the Health System 383
Key Challenges that Will Receive Attention in Upcoming Years 388
Future Prospects for Di!erent Stakeholders in the Health Enterprise 391
Conclusion 393
Case Exercise—Payments and Budget Caps in Medicare 394
Discussion Questions 394
References 394
Appendix U.S. Government Public Health Agencies 397
Glossary 403
Index 423
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1
The Challenge of
Health Care Delivery
and Health Policy
Brian Elbel and James R. Knickman
LEARNING OBJECTIVES
▶ Understand the importance of health and health care to American life
▶ Describe defining characteristics of U.S. health care delivery
▶ Discuss major issues and concerns
▶ Identify key interest groups (stakeholders)
▶ Explain the importance of engaging a new generation of health leaders
KEY TERMS
▶ access to health care
▶ consumers
▶ customer friendly
▶ fee-for-service system
▶ health care delivery
▶ health maintenance
▶ health system
▶ Patient Protection and Affordable Care Act
▶ population health
▶ stakeholder
▶ value
▶ workforce
© Springer Publishing Company DOI: 10.1891/9780826172730.0001
Copyright 2019. Springer Publishing Company.
All rights reserved. May not be reproduced in any form without permission from the publisher, except fair uses permitted under U.S. or applicable copyright law.
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4 Part I. Health Policy
TOPICAL OUTLINE
▶ Why health is so important to Americans
▶ Defining characteristics of the U.S. health care delivery system
▶ Factors that shape the structure of the delivery system
▶ Seven key challenges facing the health system
▶ Stakeholders who shape and are affected by how the health system is
organized and how it functions
▶ The organization of the book
INTRODUCTION
Our goal in editing this book is to provide a vibrant introduction to the U.S. health
care system in a way that helps new students understand the wonders of health
and health care. !e book lays out the complexities of organizing a large sector of our economy
to keep Americans healthy and to help people
get better when they become ill. In addition,
the book provides a framework to help professors engage students, with room for each
professor to bring his or her perspective to
the materials covered.
To introduce students to the many parts of
the health system in the United States, we have
engaged some of the leading thinkers and “doers” in the health sector to explain the
parts of the system in which they are expert. Each author brings a di”erent perspective, and it is not our aim to present one voice on this topic. Rather, we have asked
each author to lay out the facts about a given topic and to o”er ideas about what he
or she thinks must happen to improve a speci#c aspect of the health system.
In many ways, the text lays out a serious “to do” list facing our health system and o”ers individuals beginning a health-related career a guide to the types
of challenges that could engage them. !e authors explain how the health system works, its challenge, and how individuals can contribute to the process of
strengthening our system to ensure it works e$ciently and e”ectively at the task
of keeping all of us healthy.
In this #rst chapter, we explain the importance of the health system, provide
an overview of how the system is organized, sketch out some of the challenges
facing the overall system addressed in the book, and discuss the roles of #ve types
of key stakeholders involved in the health enterprise. We also provide the logic
behind the topics the book addresses and explain the book’s organization.
Most of us are consumers
of health care, and some
are both consumers and
providers, employers, or policy
makers. This means all of us
have a stake in improving the
performance and delivery of
U.S. health care.*
*To hear the podcast, go to https://bcove.video/2PkbOe0 or access the ebook on Springer Publishing ConnectTM.
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Chapter 1. The Challenge of Health Care Delivery and Health Policy 5
THE IMPORTANCE OF GOOD HEALTH TO AMERICAN LIFE
Our nation is built on the idea that society should ensure an opportunity for “life,
liberty, and the pursuit of happiness.” !ese words, of course, are from the second
sentence of our Declaration of Independence. !e aspiration of ensuring “life”
is the core goal of the health system. It is obvious that nothing is possible for an
individual without life, and most of us would agree that health is among the core
needs to live a vibrant, viable life. Good health is essential to participate in the
political and social system, to work to support ourselves and our families, and to
pursue happiness and a good life.
Our nation has invested a tremendous amount to learn how to keep people
healthy and how to restore health when disease, injury, or illness occurs. In the
19th century, researchers and public health experts from the United States and
other countries began to understand the role of germs in communicating disease
and the importance of basic public health practices, such as ensuring clean water
and safe sanitation to maintain health. In the 20th century, the science and art
of medicine exploded, creating amazing know-how to treat people who have
diseases, injuries, and illnesses.
In response to the emerging know-how for delivering medical care, a large
and complex health enterprise developed throughout the 20th century and continues to evolve. !e pipeline of new ideas for better treating illnesses is quite full
and promises to lead to ever-expanding methods to restore health when Americans have life-threatening medical problems. We are now faced with “personalized medicine” or the promise or hope that big data can solve many problems
related to health or health systems.
We use the word enterprise deliberately because the health system is a blend
of an altruistic-oriented set of providers and activities mixed with a huge industry that accounts for a sizable portion of all economic activity in our society.
!e value we put on health has led us to devote just under 20% of our economic
resources to medical care and health promotion (see Chapter 10, Figure 10.1).
Fully 11% of all jobs in America are in the health sector (Altarum, 2018). Each of
us spends a sizable share of our income on the health care we need. We spend
this money through taxes, which support a good share of the health enterprise;
through foregone wages used by our employers to pay for health insurance; and
by sizable out-of-pocket health care expenses for which each of us is responsible.
!us, the pursuit of life, listed as a core principle in the Declaration of Independence, not only has resulted in a set of social and political norms about the
importance of good health to everyone in America but also has spurred a huge
industry that a#ects and is a#ected by society’s economic activity and economic
decisions. To understand the health system, we need to understand not only the
art and practice of medicine and public health but also the economic, organizational, and management issues that must be addressed to keep the health system
e#ective, e$cient, and a#ordable in our overall economic life. How we go about
organizing and managing the health system and changing it over time can hurt or
help both our health status and our economic status.
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6 Part I. Health Policy
DEFINING CHARACTERISTICS OF THE U.S. HEALTH SYSTEM
It is ironic that most health professionals think of themselves as working within
the health system when in truth one of the !rst de!ning features of what we
call a system is that health-related activities are not ordered or organized as a
single enterprise. Rather, e”orts to improve health and health care involve many
types of actors and organizations working independently and with little coordination to make contributions to improving health status. In particular, our current approach to delivering medical care has evolved and keeps evolving in a
haphazard way shaped more by economic incentives and opportunities than by
a central or logical design. Equally importantly, this is not just about medical
care, but social services and other systems in place that could have an even larger
impact on health.
In recent years, we also have begun to recognize the clear di”erence between
health maintenance and restoring health to a person who has a medical
problem. #e medical care system clearly takes charge of restoring health when
people are ill. Often the medical care system takes charge of caring for people
even if restoring health is impossible; the goal may be to limit the spread of a
medical problem, to alleviate the symptoms of a medical problem, or to help a
person cope with the pain and su”ering and loss of function when major medical
problems emerge. Doctors, nurses, technicians of various types, hospitals, nursing homes, rehabilitation centers, pharmaceutical companies, and medical device
companies are among the actors who engage in e”orts to care for people when
they have medical problems.
#e goal of maintaining health also involves many actors and activities. To
some extent, medical providers help with this huge task by providing screening
and prevention services that can keep people from becoming ill and help to identify illnesses very early when they might be easier to treat. However, good health
among a population also requires a vibrant public health and social service system that works to help people avoid illness. Public health activities include preventing epidemics; making sure food, water, and sanitation are safe; monitoring
environmental toxins; and developing community-based, public awareness, and
education initiatives to help people eat healthy foods, exercise, and not engage
in unhealthy behaviors such as smoking, drinking alcohol in excess, and using
recreational drugs or abusing prescription drugs.
Increasingly, we also recognize that the health of populations is determined
by social and economic factors. Adequate family incomes, high-quality educational opportunities, and being socially connected are all key factors that predict the
health of a given person. Social issues such
as discrimination, abuse, and social respect
all are important determinants of health. To
ensure attention to these issues and others
like them requires involvement from many
Adequate family incomes, highquality educational opportunities,
and being socially connected are
all key factors that predict the
health of a given person.
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Chapter 1. The Challenge of Health Care Delivery and Health Policy 7
sectors of our society as well as political leadership to guide collective action to
ensure our society encourages pro-health norms and practices. Some people
term this a “health in all” approach to social policy. !e relatively new concept
of population health has also worked its way into the health system, with such
systems increasingly taking into account the lives of patients outside the walls of
their buildings.
We have organized this book so that it addresses both types of health issue
challenges: (a) keeping the population healthy and (b) providing e”ective medical care when needed. Other key de#ning characteristics of the U.S. health care
system guide the organization of this book:
■■ !e importance of organizations in delivering care. !ese include hospitals, nursing homes, community health centers, physician practices, social services agencies,
and public health departments.
■■ !e role of professionals in running our system. !ese include physicians, nurses,
managers, policy advocates, policy makers, researchers, technicians, and those directing technology and pharmaceutical businesses.
■■ !e emergence of new medical technology, smartphones, big data, and new pharmaceuticals. New techniques in imaging, smartphone-based apps, big data, machine
learning, pharmaceuticals, surgical procedures, DNA coding, and stem-cell technology are remarkable but often expensive ways of improving health care.
■■ Tension between “the free market” and “governmental control.” !is tension
shapes America’s culture but is sharply present, among the points of debate, in the
health care sector. Relative to citizens of other countries, Americans have more diversity of opinion about whether health care, or certain health care services, are “goods”
or “rights.” How one feels about this issue often determines whether a person thinks
the delivery of health care should be done by nonpro#t or for-pro#t organizations and
whether health care should be #nanced by taxes or private payments.
■■ A dysfunctional payment system. !e traditional way we have paid health care
providers rewards them for providing more and more billable services rather than
rewarding them for being e$cient and delivering e”ective care. !is fee-for-service
system has begun to change with more frequent use of payment approaches that
reward valued services. But, we still have a long way to go to make it economically
logical for providers to be e$cient, to be customer or patient friendly, and to focus on
the delivery of high-value services. Also, the payment approach is not transparent for
individuals who use health care. For example, patients frequently have no idea what a
service costs until after it is delivered. !is is rarely true for other goods and services
in the U.S. economy.
!ese de#ning characteristics make
health care delivery a challenging part of
U.S. politics and the economy. Addressing the
challenges of delivering health care is worth
the best e”ort and thinking of our readers,
who are tomorrow’s health care leaders.
Addressing the challenges of
delivering health care is worth
the best effort and thinking of
our readers, who are tomorrow’s
health care leaders.
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8 Part I. Health Policy
MAJOR ISSUES AND CONCERNS
Our health system can be improved in many ways. !e chapters that follow
address a long list of speci”c concerns. Many of these issues #ow, however, from
seven overarching themes regarding challenges that each of us in the health sector can address:
■■ Improving quality. Reliable studies have indicated that between 44,000 and 98,000
Americans die each year because of medical errors. Other well-regarded studies show
that people with mental health or substance use problems, asthma, or diabetes receive
care known to be e$ective only about half the time. In addition, the health system
could do much more to improve the experience of patients receiving care. !e system
is not always customer friendly and has not adopted many practices routinely used in
other service sectors to improve the consumer experience. We have a good knowledge
base about how to organize care so that high-quality services happen virtually all of the
time. !e challenge is spreading this knowledge into practice across the nation.
■■ Improving access and coverage. Millions of Americans still lack insurance coverage, and millions more have inadequate coverage for acute care. !e federal health
reform, the Patient Protection and Affordable Care Act (ACA; Obamacare), has
dramatically reduced the number of people who lack insurance coverage, though gaps
in coverage persist. Many states (though a decreasing number) have chosen not to
adopt some of the expansions for low-income residents because of political opposition. Even when Americans have insurance coverage, access to health care is not
always ensured. Many rural areas have shortages of doctors and other providers, and
many doctors refuse to see patients with certain types of insurance (generally coverage
for low-income residents, or Medicaid coverage) because of low payment rates.
■■ Slowing the growth of health care expenditures. Health care expenditures are
simply the price of services multiplied by the volume (or number) of services. Total
expenditures are growing much more rapidly than the rest of the economy because
both prices and volume of services have increased relentlessly over the past 50 years.
To keep health care a$ordable for middle-class and low-income residents—as well as
for taxpayers and employers—we need to devise ways to moderate the ever-increasing
share of our nation’s economy devoted to the health sector. !e challenge is to determine how to restructure delivery and payment so we can focus on high-value care
as we get more e%cient, with less waste. !ere has been progress in bringing costs
of care down, especially due to the dynamics put in place by the great recession that
started around 2008. Unfortunately, progress in reducing costs has helped businesses
and government payers of care much more than it has helped individuals who have to
buy health insurance in the private market place.
■■ Encouraging healthy behavior. Healthy behavior can help people avoid disease and
injury or prevent disease or injury from getting worse. For millions of Americans, leading healthy lives is not of the highest priority relative to other more pressing factors in
their lives. Changing health-related behavior is a di%cult challenge, and one that health
systems are increasingly taking on, but we need to identify e$ective prevention programs
and ways to make our social and built environments more encouraging of healthy choices.
■■ Improving the public health system. !e governmental public health infrastructure
maintains population health and regulates aspects of the health care delivery system.
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Chapter 1. The Challenge of Health Care Delivery and Health Policy 9
State and local health departments monitor the health of residents, provide a wide
range of preventive services, and regulate health care providers and businesses, such
as restaurants, that a!ect population health. “e e!ectiveness and funding of state,
municipal, and county health departments vary widely.
■■ Improving the coordination, transparency, and accountability of medical care.
Problems of quality, cost, and access are caused by fragmentation and lack of coordination at the community level. “is fragmentation exists both within and between
health care organizations. It is a!ected by a lack of integrated and electronic record
systems and by a lack of cooperative relationships among di!erent types of providers who treat the same patient. For example, primary care physicians, hospitals, and
specialty physicians often fail to work as teams or in coordinated ways. Consumers
often are not given all of the information they deserve to make adequate medical
choices. Providers often refuse to reveal the prices they will charge patients, second
opinions are still not encouraged as frequently as they should be, and patients often
do not get clear explanations of treatment options or the pros and cons of these
options.
■■ Addressing inequalities in access and outcomes. In the United States, medical care
and its associated outcomes depend on one’s income level, race, and geographical location. In many cases, the care received by those with less income is subpar. Moreover,
studies demonstrate that access and outcomes vary by race, even for Blacks, Latinos,
and Whites who have the same incomes and education levels. Marked di!erences also
exist in access, quality, and outcomes across di!erent regions of our country. Best
practices do not spread easily or quickly. Addressing these inequalities is a major challenge facing the health sector.
KEY STAKEHOLDERS INFLUENCING THE HEALTH SYSTEM
A complicated enterprise like the health system includes many types of stakeholders. A stakeholder group is a set of people who have a strong interest in how
something in our society is done. In addition, stakeholders generally have some
power in shaping what happens. Finally, di!erent stakeholders may have very different goals and views about what should be done and how.
To understand the health system, one needs a good scorecard of the interests and roles of distinct stakeholder groups. Each contributor to this book
gives attention to roles of stakeholders. “e stakeholders that keep appearing as
the story of the health system unfolds include #ve key groups: (a) consumers,
(b) providers and other professionals engaged in the health system, (c) employers,
(d) insurers, and (e) public policy makers.
Individuals
Individual consumers (or patients) should
be at the center of the health system. After
all, it is their needs and wants that are the
A stakeholder group is a set
of people who have a strong
interest in how something in our
society is done.
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10 Part I. Health Policy
reason for this giant enterprise. In some ways, however, individuals sometimes
seem like bystanders in health care decisions. Often, physicians and other providers assert that they know best and fail to have a patient co-manage a medical
problem or be a full partner in selecting a choice of action. Or, perhaps worse, an
insurer decides what is best or “allowed” given a speci!c health condition.
Individuals are also bystanders in issues about payments. Providers sometimes think their “customer” is an insurance company because the insurer pays
much of the bill. In addition, the same provider (unknown to many individuals)
may charge astonishingly di”erent prices to di”erent groups and individuals. #e
usual norm in our economy, unlike in health care, is that the person receiving
goods or a service is the customer, and the customer has a right to know what the
charge will be before purchasing the good or service.
Even so, individuals are in$uential stakeholders in many ways. For example,
when there is widespread dissatisfaction among them, change happens. Insurers
changed the rules of early managed care payment systems in the 1990s due to
consumer complaints. Similarly, a major federal program o”ering a new form of
catastrophic insurance to elders was repealed after sharp dissatisfaction among
seniors.
Most experts argue that individuals need to be at the center of health care
choices. Additionally, individuals need to understand the crucial role their
behavioral choices play in determining their health status. Choosing to eat
healthy foods, stay physically active, drink alcohol moderately, and abstain from
tobacco products are among the most important choices they make to protect
their health.
What do individuals want as key stakeholders? Most importantly, they want
good access to health care for themselves and their families. Polls indicate that
individuals value good-quality care and a”ordable care. #ey would also like to be
treated well by providers and have a good experience when they need care.
Providers and Other Professionals Engaged in Making the
Health System Operate
Many professionals work to advance medical knowledge, medical practice, and
the business of health care. #e vast majority of this workforce is motivated principally by the social goal of keeping people healthy. Medical providers, caregivers,
pharmaceutical and medical device companies, and researchers have created an
impressive set of interventions that can help people who are sick.
In recent years, however, many members of the broad health workforce have
faced great !nancial pressure to prevent the costs of health care from increasing
as quickly as in the past. Payment systems keep lowering the fees paid for goods
and services, and consumers and payers have been demanding better quality, better outcomes, more value, and better patient experiences. In addition, the organization of services has begun to evolve quickly.
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Chapter 1. The Challenge of Health Care Delivery and Health Policy 11
More and more physicians and other
providers are working in large practices
compared with the small ones that used to
be the norm. Hospitals are merging with
other types of medical providers, and the
approach insurers use to pay for services
is changing rapidly. A greater number of
professionals, inside and outside the health
system, are also increasingly engaged in
working to improve health.
Understanding the views and needs of the health workforce and the organizations dedicated to improving health is crucial to understanding how the system
works and how to improve the system. !e following chapters suggest that providers and professionals engaged in the health enterprise would value simpler
rules that govern how care is provided and fair opportunities to earn incomes
that re”ect their expertise and their large investments in training.
Employers
Employers are stakeholders because most businesses o#er employees private
health insurance as a key element of their compensation package. In this sense,
the cost of health insurance is a cost of doing business for employers and can
greatly a#ect the pro$tability of a business. For example, employee health care
costs add approximately $1,500 to the cost of producing every automobile manufactured in the United States.
In their role as stakeholders, employers want to see a slowdown in their
health care cost responsibility as compared with the last 50 years. In addition,
employers want healthy employees who are productive and do not have to take
time o# from work due to illness. !ese desires lead some employers to advocate
for high-quality health care and for wellness and prevention programs that help
employees stay healthy.
Insurers
Insurance companies act as the intermediary among payers (often employers),
providers (who need a system for getting paid), and consumers (who need a system
to determine the kinds of health care covered by the employer’s insurance plan).
In some cases, insurers take some $nancial risk: If the payments they make
to providers exceed the premiums set for employers, the insurer loses money.
Increasingly, however, the insurer leaves the employer to bear the risk and plays
the role of a pure intermediary, setting rules to determine when a health service
is eligible for reimbursement and other rules to determine what payment is made.
Of course, an insurer must negotiate these rules with employers and providers.
Understanding the views and
needs of the health workforce
and the organizations dedicated
to improving health is crucial to
understanding how the system
works and how to improve the
system.
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12 Part I. Health Policy
As stakeholders, insurers always face pressure. Employers, consumers, and
providers often have tense relationships with insurers, who in many ways play
the role of referees in health care. Payers often feel that the costs of running the
insurance process are too expensive.
Some approaches to payment currently exist that could compete with traditional insurance companies. Some health systems are starting their own insurance companies, and it is possible that capitated payment systems (payment of a
premium for a person/family for the year regardless of use of covered bene!ts)
could bypass traditional insurance systems and go directly from payers to providers. Insurers want to protect their role in the health sector. “ey also seek to
expand their role by o#ering analytical services that can support higher-quality
and more e$cient delivery approaches.
Public Policy Makers
“e !nal type of stakeholder we consider is policy makers; both appointed public o$cials and elected politicians are included in this category. However, policy
makers do not act as a single stakeholder group. Instead, various components of
this group set agendas, which often con%ict with one another.
Elected o$cials di#er strikingly in their views about how the health system
should work and about the role government should play in health care. At times,
di#erences in views re%ect di#erent ideologies. Sometimes, however, di#erent
views emerge about how best to manage the extensive responsibilities that have
fallen to government over the past 80 years.
Consensus does exist on some policy issues, however, within this stakeholder
group. Most elected o$cials and civil servants working on health issues would
like to see slower in%ation rates in the health sector. In addition, there is consensus that the U.S. health system should use state-of-the-art medical care and
prevention interventions. Finally, there is a common sense that quality and the
patient experience should be important concerns of health providers.
ORGANIZATION OF THIS BOOK
“e book is organized into four parts:
Part I: Health Policy—has chapters on the current state of health care delivery, charts depicting key statistics, a discussion of the important role of policy,
and a comparative analysis of health care delivery in other countries.
Part II: Keeping Americans Healthy—has four chapters on population health,
public health, behavioral health, and the health of vulnerable populations.
Part III: Future of Health Care Delivery and Health Policy in the United
States—has six chapters on organization of care, workforce, !nancing, cost and
value, quality of care, health care management and governance, and information
technology.
Part IV: Futures—summarizes key ideas addressed in the book, with a look to
the future about how change in the health system might play out.
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Chapter 1. The Challenge of Health Care Delivery and Health Policy 13
CONCLUSION
!e editors remain optimistic that pragmatism, “exibility, consensus building,
and attention to objective, high-quality evidence can bring about positive change.
We remain stimulated by the challenges we face as we work hard at the local, state,
and national levels to create and sustain a viable and e#ective health care system.
Certainly, we have observed that best practices are now used to improve
health care and health across a wide range of settings in the United States and
worldwide. How do we speed up the process of getting more for the money we
spend, and how do we engage every type of stakeholder to bring about more
e#ective services by insisting on best practices in everything we do? !is book
gives the reader the motivation and skills to get engaged.
!e future U.S. health care delivery system will see improvements if committed and informed Americans choose to enter the $eld and engage e#ectively.
Future leaders who are knowledgeable about the health sector and who know
how to implement e#ective change are needed. !e system also needs to improve
quality, get more value for cost, improve patient participation in self-care, and
encourage provider transparency and accountability.
CASE EXERCISE—HEALTH CARE DELIVERY PLAN
You are an aide to the governor of State X. A billionaire has said he will give the governor $3
billion if he comes up with a satisfactory plan to improve health and medical care for the state.
Assume the state currently spends $300 billion on health care annually. The goal is ensuring
quality of health care, improving the patient experience, improving the overall health of the
state’s population, and containing the increase in health care costs. Develop the criteria for
assessing the success of the plan. Where will the major shifts in resources occur? Give a
rationale for your recommendations.
As you consider this case, you might address the following questions:
1. How might the billionaire evaluate whether the governor’s plan is satisfactory?
2. After the money is given to fund the plan, what must happen to improve health care
delivery performance substantially in State X?
t
DISCUSSION QUESTIONS
1. What is the real and perceived performance of the U.S. health care system? How do
views di#er among di#erent groups of patients, providers, payers, and politicians?
2. Why do we spend so much money on health care?
3. Why isn’t the population healthier?
4. How is the ACA part of the problem or part of the solution to improving health care
delivery in the United States?
5. What are your priorities to improve the value of health care Americans get for the
money we spend? What is your rationale for these priorities?
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14 Part I. Health Policy
REFERENCE
Altarum. (2018). Health care jobs engine propels share of total jobs to all-time high.
Retrieved from https://altarum.org/news/health-care-jobs-engine-propels-share-totaljobs-all-time-high
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2
Organization of Care
Amy Yarbrough Landry and Cathleen O. Erwin
LEARNING OBJECTIVES
▶ Describe the current care delivery system
▶ Define and distinguish between types of health care services along the
continuum of care
▶ Identify and discuss types of organizations in the U.S. health care delivery
system
▶ Increase awareness of new mechanisms for health system performance
improvements
▶ Understand and discuss future trends in the health delivery system
▶ Describe innovative approaches to improving care delivery
KEY TERMS
▶ academic health center
▶ accountable care organizations (ACOs)
▶ accreditation
▶ ambulatory care
▶ average length of stay (ALOS)
▶ centers of care
▶ certification
▶ chronic care
▶ community health improvement
▶ continuing care retirement community
▶ continuity of care
▶ continuum of care
© Springer Publishing Company DOI: 10.1891/9780826172730.0002
Copyright 2019. Springer Publishing Company.
All rights reserved. May not be reproduced in any form without permission from the publisher, except fair uses permitted under U.S. or applicable copyright law.
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AN: 1998657 ; James R. Knickman, PhD, Brian Elbel, PhD, MPH.; Jonas and Kovner’s Health Care Delivery in the United States, 12th Edition
Account: s3563253.main.ehost
16 Part I. Health Policy
▶ corporate practice of medicine (CPOM)
▶ emergency care
▶ end-of-life care
▶ health homes
▶ horizontal integration
▶ hospice care
▶ inpatient
▶ instrumental activities of daily living (IADLs)
▶ long-term care
▶ multispecialty group practice (MSGP)
▶ outpatient
▶ palliative care
▶ patient-centered medical home (PCMH)
▶ population health
▶ prehospital care
▶ primary care
▶ private practice
▶ privileges
▶ public health agencies
▶ quaternary care
▶ rehabilitation clinics
▶ same-day surgery
▶ single specialty group practice
▶ solo practice
▶ specialty care
▶ special hospitals
▶ subacute care
▶ tertiary care
▶ urgent care centers
▶ vertical integration
TOPICAL OUTLINE
▶ The current organization of the health care delivery system
▶ Types of health care delivery organizations
▶ Health system performance
▶ The future of the health care delivery system
▶ Examples of best practices in the organization of medical care
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Chapter 2. Organization of Care 17
INTRODUCTION
In the United States, health care is delivered through a complex and multifaceted system of private and public institutions that operate in cooperation with,
but largely independent of, each other. Unlike
many other countries, the United States has
no central governmental agency to control
the delivery of health care, although delivery is heavily in!uenced through health
care legislation and the government’s role
as a major purchaser of health care services
through Medicare, Medicaid, and other public
programs. “e continuum of care in the United States encompasses care from
the cradle to the grave and includes services focused on both the prevention and
the treatment of medical conditions and diseases as well as end-of-life care.
“e individuals and organizations that provide care in the United States are
faced with increasing pressure and scrutiny from the government, private insurance organizations, and the public to provide the highest quality of care while
controlling costs and increasing access to underserved populations. Consequently, health care services and organizational structures are continuously being
adapted to meet the demands and mandates of health care policy and to survive
and thrive in this dynamic health care environment.
“is chapter describes the current health care delivery system in the United
States, including services, organizations, health system performance, and new
innovations in care delivery.
DESCRIPTION OF THE CURRENT CARE DELIVERY SYSTEM
“e World Health Organization (WHO) de#nes health as a “state of complete
physical, mental and social ‘wellbeing’ and not merely the absence of disease or
in#rmity” (WHO, 2017). By de#nition, the health system includes all organizations, institutions, and resources that have a primary purpose of promoting,
restoring, and/or maintaining health (WHO, 2015). From a broad, comprehensive
perspective it includes care delivered through traditional clinical and public health
settings as well as contributions to health from a variety of community organizations that have a stake in or can a$ect the health of individuals and communities.
“e following sections provide a general discussion of the types of clinical health
care services available in the United States, the types of organizations through which
these services are delivered, and how these and other organizations are involved in
the #elds of community health, community bene#t, and population health.
Health Care Services
Health care services are provided for the purpose of contributing to improved
health or to the diagnosis, treatment, or rehabilitation of sick people. Health care
The organization of the nation’s
complex and multifaceted
health care system can
evolve as patients’ needs and
government regulations and
policies change.*
*To hear the podcast, go to https://bcove.video/2E1WuAY or access the ebook on Springer Publishing ConnectTM.
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18 Part I. Health Policy
services include prevention, cure, rehabilitation, and palliation e!orts oriented to either
individuals or populations.
Prevention
Prevention of disease and maintenance of
general good health are the focus of health
promotion and preventive services. Health status is a!ected by a number of factors, including health policy, individual behavior, social determinants, physical
determinants, biology and genetics, and availability of health services. Services
associated with prevention may be focused on the health of an individual or the
health of a population. Although prevention services have always been available
in the United States, an even greater emphasis is placed on prevention because of
its prominence in the Patient Protection and A!ordable Care Act of 2010 (ACA)
as an essential component of health insurance bene”ts. Most health plans must
cover a set of preventive services at no cost to the bene”ciary. Additionally, a variety of new reimbursement mechanisms used by both private and governmental
payers incentivize provider organizations to keep patient populations healthy and
out of the hospital.
#e prevention “eld often distinguishes interventions delivered by a health
care provider (clinical prevention services) from those delivered by non–health
care providers (community-based prevention initiatives). According to the Institute of Medicine (IOM, 2012), a holistic view of community-based prevention
incorporates cultural, social, and environmental changes; also, community-based
prevention is often more di%cult to fund and sta! than clinical interventions.
Certain preventive services may be o!ered through a clinical–community relationship that might entail a primary care provider making a connection with a
community-based organization to provide speci”c services (such as a community-based weight-loss program) or collaboration between clinical and community-based organizations to network, coordinate, or cooperate on preventive
services delivery. Additionally, the “eld sometimes distinguishes between prevention initiatives that focus on individuals one at a time and initiatives that are
more population-based, working with larger groups of people (e.g., e!orts to
increase the availability of healthy food in low-income neighborhoods).
PUBLIC HEALTH, COMMUNITY HEALTH, AND POPULATION HEALTH It’s important to distinguish
between the “elds of public health, community health, and population health,
which are sometimes used interchangeably yet di!er somewhat in de”nition and
scope. Traditionally, public health has been viewed as a function of federal, state,
and local public health departments to address health concerns a!ecting the public at large, such as preventing epidemics, containing environmental hazards, and
promoting healthy living (IOM, 2003).
A more expansive view of public health is the concept of community health
improvement or community bene”t, which focuses on collaboration among a
wide array of organizations (e.g., public health departments, health care delivery
organizations, social service agencies, government entities) to address issues
Health care services are
provided for the purpose of
contributing to improved health
or to the diagnosis, treatment, or
rehabilitation of sick people.
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Chapter 2. Organization of Care 19
impacting the health of a particular community. !e interest in how health care
and public health activities could be coordinated to improve the health of communities was accelerated in the mid-1990s, fueled by organizations such as the
Robert Wood Johnson Foundation, Institute of Medicine, and U.S. Department of
Health and Human Services and organized hospital groups such as the Catholic
Hospitals of America and Voluntary Hospitals of America (VHA), among others.
!e Association for Community Health Improvement is an a”liate organization
of the American Hospital Association (AHA) and serves as a national association
for community health, community bene#t, and population health professionals.
!is is one avenue through which hospitals and health systems receive educational resources, tools, networking opportunities, and professional development
to assist in achieving organizational community health goals.
Although many health care organizations actively engaged in community
health needs assessment and activities prior to the passage of the ACA, the ACA
mandates that all nonpro#t hospitals complete a community health needs assessment (CHNA) process every 3 years. CHNAs are a tool that have long been used
by hospitals, public health departments, and other social service agencies (e.g.,
United Way) to identify and prioritize signi#cant health needs in the community.
Community health also encompasses a broad perspective on the various components or factors that a$ect the health of a community, such as employment,
crime, education, housing, transportation, food, and medical care.
More recently, the concept of population health has become an important
topic and focus for health care delivery organizations and payers. It has been
de#ned as “the health outcomes of a group of individuals, including the distribution of such outcomes within the group” (Kindig & Stoddart, 2003). In general,
population health focuses on health status indicators for a de#ned group of
people, and the goal of population health management is to improve the health
of the population and reduce inequities or disparities between population
groups. Ways that organizations approach population health management will
be described later in this chapter.
Clinical prevention services are often categorized as primary, secondary, or
tertiary, based on the stages of the disease they target.
PRIMARY PREVENTION SERVICES Primary prevention services are focused on preventing or reducing the probability of the occurrence of a disease in the future. Services are provided through public and private institutions and are often focused
on educating the public about the risks associated with individual behaviors that
can negatively a$ect their short- and long-term health.
Examples of primary prevention include immunizations for prevention of
childhood diseases, smoking cessation programs to reduce the risk of lung cancer
and heart disease, weight loss programs, prenatal and well-baby care, programs
to increase workplace safety, and the promotion of hand washing to reduce the
spread of in&uenza or other diseases. !e services are provided through a wide
variety of institutions, such as public health departments, physician o”ces,
hospitals, social service agencies, places of employment, houses of worship, and
broadcast media, among others.
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20 Part I. Health Policy
SECONDARY PREVENTION SERVICES !ese services are focused on the early detection
and treatment of disease in order to cure or control its e”ects. !e goal is to minimize the e”ects of the disease on the individual. Secondary services are largely
focused on routine examinations and tests such as blood pressure screenings,
Pap smears, routine colonoscopies, examination of suspicious moles, and mammograms. Early detection and treatment often increases the probability of a successful outcome.
TERTIARY PREVENTION SERVICES !ese services are targeted at individuals who already
have symptoms of a disease in order to prevent damage from the disease, to slow
down its progression, to prevent complications from occurring as a result of the
disease, and ultimately to restore good health to the person with the disease.
Tertiary prevention includes services such as providing diabetic patients with
education and counseling on wound care. It also includes institutional practices
such as infection control in a hospital facility to prevent illness or injury caused
in the process of providing health care.
Acute Care
Acute care is short-term, intense medical care providing diagnosis and treatment
of communicable or noncommunicable diseases, illness, or injury. !e de#nition of acute care varies across the scholarly literature and textbooks. Acute care
is sometimes de#ned as primary, specialty, tertiary, or quaternary in nature,
centered around the care delivered by physicians and other providers in clinical
settings (such as physician o$ces and hospitals). Acute care services may be provided on an outpatient basis (i.e., not requiring an overnight hospital or health
care facility stay) or on an inpatient basis (i.e., requiring an overnight stay).
A more comprehensive de#nition of acute care includes not only these services
but also the emergency services provided in the community given the time-sensitive nature of the need for diagnosis and treatment. One proposed de#nition of
acute care includes the components of the health system where acute care is delivered to treat unexpected, urgent, and emergent episodes of illness and injury that
could lead to disability or death without rapid intervention (Hirshon et al., 2013).
Based on this de#nition, acute care encompasses a range of functions including
emergency care, trauma care, prehospital emergency care, acute care surgery,
critical care, urgent care, and short-term inpatient stabilization (Figure 2.1). !e
following sections outline the types of acute care based on the framework illustrated in Figure 2.1, although not all of the domains are discussed because of obvious overlaps. !e primary, specialty, tertiary, and quaternary care de#nitions are
incorporated into the framework to show where these levels of care best #t within
the acute care model and to note relationships to other forms of care.
EMERGENCY AND URGENT CARE Emergency care is designed to provide immediate
care for sudden, serious illness or injury, although it is sometimes utilized for
nonemergent care by individuals who are uninsured or underinsured. A medical
emergency is de#ned by what is known as the prudent layperson standard:
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Chapter 2. Organization of Care 21
[A] condition with acute symptoms of su!cient severity (including severe pain)
such that a prudent layperson, who possesses average knowledge of health and
medicine, could reasonably expect the absence of immediate medical attention to
result in (i) placing the health of the individual (or unborn child) in serious jeopardy, (ii) serious impairment of bodily functions, or (iii) serious dysfunction of any
bodily organ or part. (Social Security Act § 1867)
Emergent types of care (such as trauma) can be classi”ed by the triage level,
that is, by the emergency severity index (ESI). #e ESI is a “ve-level triage algorithm that clinically strati”es patients into groups based on immediacy of the
need to be seen, which includes the following levels:
1. Immediate (less than 1 minute)
2. Emergent (1–14 minutes)
3. Urgent (15–60 minutes)
4. Semiurgent (61–120 minutes)
5. Nonurgent (121 minutes–24 hours)
In 2015, .7% of ED visits were classi”ed as immediate, 7.4% as emergent, and
29.8 as urgent; the remaining 61.2% were either semiurgent, nonurgent, not triaged, or unknown (Centers for Disease Control and Prevention [CDC], 2017).
#e Emergency Medical Treatment & Labor Act of 1986 (EMTALA) requires
that all patients who present themselves for treatment at an ED must be screened
and evaluated, provided the necessary stabilizing treatment, and admitted to the
hospital when necessary—regardless of ability to pay.
Urgent care is used for an illness, injury, or condition that is serious enough
for a reasonable person to seek care right away but not so severe as to require
ED care. It is considered ambulatory care, which means that the person in need
of care can walk (or ambulate) into the facility. However, a patient in need of
“ambulatory” care may need some assistance entering the facility, depending on
the nature of the illness or injury (e.g., severe ankle sprain). Services are provided
by physicians and advanced practice providers (such as nurse practitioners or
physician assistants) typically on a walk-in basis without a previously scheduled
appointment because of the immediacy of the need. Urgent care services may be
provided through a traditional physician practice or an urgent care center.
PREHOSPITAL CARE Prehospital care includes medical services provided in the community, such as stabilization by emergency services before or during transportation to a health care facility. It also includes evaluation and treatment provided
through local, community-based providers, as in a private physician practice
setting.
Primary care. Primary care is the “rst and most general source for routine
treatment of illness and disease. Primary care providers may be physicians, physician assistants, or nurse practitioners who have trained in family medicine,
internal medicine, pediatric medicine, gerontology, or other primary care “specialties,” such as obstetrics and gynecology. In the managed care environment,
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22 Part I. Health Policy
EMERGENCY
CARE
URGENT
CARE
PREHOSPITAL
CARE
CRITICAL
CARE
TRAUMA CARE
& ACUTE CARE
SURGERY
ACUTE
CARE
SHORT-TERM
STABILIZATION
a
b
c
d
e
f
aTreatment of individuals with acute surgical needs, such as life-threatening injuries, acute appendicitis, or
strangulated hernias.
bTreatment of individuals with acute life- or limb-threatening medical and potentially surgical needs,
such as acute myocardial infarctions or acute cerebrovascular accidents, or evaluation of patients with
abdominal pain.
cAmbulatory care in a facility delivering medical care outside a hospital emergency department, usually on
an unscheduled, walk-in basis (e.g., evaluation of an injured ankle or fever in a child).
dTreatment of individuals with acute needs before delivery of de!nitive treatment (e.g., administering
intravenous “uids to a critically injured patient before transfer to an operating room).
eCare provided in the community until the patient arrives at a formal health care facility capable of giving
de!nitive care (e.g., delivery of care by ambulance personnel or evaluation of acute health problems by
local health care providers).
fSpecialized care of patients whose conditions are life-threatening and who require comprehensive care
and constant monitoring, usually in intensive care units (e.g., patients with severe respiratory problems
requiring endotracheal intubation and patients with seizures caused by cerebral malaria).
Source: Hirshon, J. M., Risko, N., Calvello, E. J. B., de Ramirez, S. S., Narayan, M., #eodosis, C., &
O’Neill, J. (2013). Health systems and services: #e role of acute care. Bulletin of the World Health Organization, 91, 386–388. doi:10.2471/BLT.12.112664. Used with permission.
FIGURE 2.1 DOMAINS IN ACUTE CARE
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Chapter 2. Organization of Care 23
primary care delivery plays an important role in the coordination of care to help
control costs and ensure that the appropriate level of care is sought for the health
concern. Primary care providers are involved in delivering both acute care and
preventive care.
Specialty care. Specialty care refers to care delivered through providers who
are trained as specialists or subspecialists in the !eld of medicine. “is type of care
sometimes requires a referral from a primary care physician. Specialists focus on a
particular body system or on a speci!c disease or condition; they have the knowledge and expertise to handle medical conditions beyond the realm of primary
care. For example, cardiologists diagnose and treat conditions involving the heart,
endocrinologists focus on hormone systems and may specialize in a disease such
as diabetes, and neurologists are trained to diagnose and treat disorders associated
with the nervous system—brain, spinal cord, and so on. Similarly to primary care,
specialty care may be utilized to address both acute and preventive care needs.
Chronic care. Chronic care is the continual treatment and monitoring of
conditions that can be controlled but not cured; it includes both physical and
behavioral conditions. Examples of chronic conditions include diabetes, hypertension, and depression. As the life expectancy of the population has increased, so
have the incidence and prevalence of chronic conditions. It is estimated that more
than one-fourth of all Americans and two out of three older Americans have at
least two chronic conditions, and approximately 66% of the nation’s health costs
are attributable to the treatment of people living with multiple chronic conditions (Agency for Healthcare Research and Quality, 2013).
“e management and treatment of chronic conditions may be delivered by
primary and/or specialty care providers. By de!nition, chronic care is not considered acute care; however, chronic conditions can cause or exacerbate acute
episodes of illness. Chronic care also !ts within the category of preventive services, which include services that focus on the early detection and management
of chronic conditions.
TERTIARY CARE Tertiary care typically involves hospitalization for specialty care
that requires highly specialized equipment and expertise and involves more complex therapeutic interventions, such as coronary bypass surgery, neurosurgery,
advanced neonatal intensive care, or treatments for severe burns or injuries. Some
tertiary care services may be provided on an outpatient basis, such as same-day
surgeries. Patients are admitted to a tertiary facility through a practitioner order
from a quali!ed provider who has been granted admitting privileges by the facility.
QUATERNARY CARE Quaternary care, an extension of tertiary care, entails providing
the most complex medical and surgical care for highly specialized and unusual
cases. It may involve experimental procedures, experimental medications, or very
uncommon surgeries or procedures. Examples of quaternary care are advanced
trauma care and organ transplantation. Quaternary care is not o#ered by every
hospital or medical center; it is more likely to be found in academic medical centers.
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24 Part I. Health Policy
SUBACUTE INPATIENT CARE Subacute care is a level of inpatient care needed by a
patient immediately after or instead of hospitalization for an acute illness, injury,
or exacerbation of a disease process. !is level of care centers on providing one
or more active medical conditions or administering one or more technically complex treatments. It requires more intensive skilled nursing care than is provided
to the majority of patients in a skilled nursing facility (i.e., nursing home).
!e term “subacute care” has been applied to a broad range of medical and
rehabilitative services and settings that provide care to patients after an acute
care episode. It combines rehabilitation and convalescent services for patients
who typically need 10 to 100 days of treatment and is provided in settings other
than in acute care hospital beds. Subacute care is delivered in facilities licensed to
provide the appropriate level of care, which includes special units established by
acute care hospitals and skilled nursing facilities.
Rehabilitative Care
Rehabilitative health care services are aimed at restoring a person to his or her
original state of health (or as close as possible). Rehabilitation services help a person keep, regain, or improve skills and functioning for daily living that have been
lost or impaired because of illness or injury. Services include physical therapy,
occupational therapy, speech–language pathology, and psychiatric rehabilitation.
Rehabilitative services are o”ered in a variety of inpatient and outpatient settings.
Long-Term Care
Long-term care encompasses a range of services and support provided to meet
personal care needs on a long-term basis, most of which is not medical care. It
encompasses an array of services provided in a variety of settings for people who
have lost some independence because of a medical condition, injury, or chronic
illness. Long-term care is often used to provide assistance with activities of daily
living (ADLs), such as bathing, dressing, using the toilet, transferring to or from
a bed or chair, and eating, among others. Other common services and support
assist with instrumental activities of daily living (IADLs), which are everyday
tasks, such as housework, taking medication, preparing meals, shopping, and
responding to emergency alerts, among others.
!e duration and level of long-term care needed by individuals vary and often
change over time. Long-term care services may be provided in an individual’s
home or in a community setting or institution.
End-of-Life Care
End-of-life care is provided in the #nal hours or days of an individual’s life. !is
type of care includes physical, mental, and emotional comfort as well as social
support for people who are living with and dying of terminal illness or a condition that is advanced, progressive, and incurable. End-of-life care requires a range
of decisions. !ese decisions may include preparing advance directives to make
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Chapter 2. Organization of Care 25
end-of-life wishes clear to family and providers as well as determining the types
of treatment and care that will be utilized.
Palliative care is the treatment for discomfort, symptoms, and stress of serious illness, providing relief from pain, fatigue, nausea, shortness of breath, loss of
appetite, or problems with sleep. Palliative care can be received at any stage of an
illness but is always included in hospice care.
When the focus shifts from cure to care, a patient moves to hospice care.
Hospice care is end-of-life care utilized when a patient is expected to live 6
months or less. It is provided by a team of health care professionals and volunteers in the home, a hospice center, a hospital, or a skilled nursing facility. Hospice
programs also provide services to support a patient’s family. !e interdisciplinary
hospice team usually consists of the patient’s personal physician; hospice physician or medical director; nurses; hospice aides; social workers; bereavement
counselors; clergy or other spiritual counselors; trained volunteers; and speech,
physical, and occupational therapists, if needed.
Health Care Delivery Organizations
!is section discusses the wide range of organizations that exist to deliver health
care services, including hospitals, health systems, physician o”ces, specialty hospitals, long-term care facilities, rehabilitation hospitals, home health agencies,
and other health-related organizations.
Hospitals
By de#nition, a hospital (other than psychiatric) is an institution primarily engaged
in providing, by or under the supervision of physicians, to inpatients, diagnostic
and therapeutic services for medical diagnosis, treatment, and care of injured,
disabled, or sick persons; or rehabilitation services for injured, disabled, or sick
persons. Outpatient services are optional but have been growing in importance
over time as more and more medical interventions can be done in an outpatient
setting and as the #eld sees growing importance to integrating primary care, specialty care, and inpatient care for reasons of both quality and e”ciency.
According to the AHA (2018), the United States has approximately 5,534
registered hospitals, which include all community, federal, psychiatric, and longterm care hospitals and hospital units located in institutions (such as prison
hospitals, college in#rmaries, and so on). Hospitals can be categorized in a number
of ways, such as by purpose, size, ownership, location (urban or rural), teaching
status, or system a”liation. Most hospitals in the United States provide general
medical and surgical services on a short-term basis. !e four primary categories
for hospitals according to the AHA are (a) community, (b) special, (c) rehabilitative and chronic disease, and (d) psychiatric.
Hospitals are subject to federal and state regulations. A hospital must be
licensed to operate; licensing is handled at the state level by the agency or entity
designated with such authority for the state. Licensure focuses on physical plant
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26 Part I. Health Policy
requirements, sanitation, personnel, and equipment. To receive reimbursement
for services provided to Medicare and Medicaid patients, hospitals must receive
certification from the federal government. Hospitals may choose to pursue
accreditation by !e Joint Commission, an independent, nonpro”t organization
that accredits hospitals and other types of health care institutions. !is voluntary
participation in accreditation is a symbol of quality that indicates the organization has met certain performance standards. !e Centers for Medicare & Medicaid Services (CMS) recognize accreditation as suitable proof that a hospital has
met the minimum requirements to receive certi”cation.
Patients are referred to the hospital for services on the authority of a member
of the medical sta# (i.e., a physician) who has been granted admitting privileges
in accordance with state law and criteria for standards of medical care established
by the facility. Hospitals provide both inpatient (requiring an overnight stay) and
outpatient services (not requiring an overnight stay). Outpatient services are
sometimes referred to as ambulatory care, which means the patient is able to
walk (ambulate) into the facility to receive diagnostic or therapeutic treatment.
However, in actuality not all patients who receive outpatient services can ambulate (e.g., patients brought to the ED by ambulance).
COMMUNITY HOSPITALS By AHA de”nition, community hospitals are all nonfederal,
short-term general, and other special hospitals accessible by the general public.
General hospitals provide patient services, diagnostic and therapeutic, for a variety of medical conditions; the average length of stay (ALOS) is less than 25 days.
Hospitals also provide diagnostic x-ray services, clinical laboratory services, and
operating room services with facilities and sta# for a variety of procedures. Services are provided on both an inpatient and an outpatient basis. Traditionally,
hospitals primarily have delivered care on an inpatient basis, but over the past
three decades more services have been moved to an outpatient, or ambulatory,
basis to contain costs. In addition to cost containment, medical practices have
advanced enabling many procedures that previously required an overnight stay
to become less invasive and therefore require a shorter recovery period that can
be achieved at a patient’s home without nursing care.
Special hospitals provide diagnostic and treatment services for patients who
have speci”ed medical conditions, both surgical and nonsurgical. !ese hospitals
must provide the services deemed appropriate for the speci”ed medical conditions for which services are provided.
Community hospitals are grouped by ownership in three categories:
■■ Voluntary, not-for-pro”t (nonpro”t)
■■ Investor-owned (for-pro”t, proprietary)
■■ Public (state or local government owned and managed)
Some community hospitals operate as free-standing single hospital entities,
whereas others are part of a health system. A system is de”ned as either amultihospital
or diversi”ed single hospital system. Community hospitals may also be classi”ed as
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Chapter 2. Organization of Care 27
participating in a network, which is de!ned as a group of hospitals, physicians, other
providers, insurers, and/or community agencies that work together to coordinate
and deliver a broad spectrum of services to the community (AHA, 2018).
Hospitals may also be classi!ed by teaching status—teaching hospitals are
a”liated with medical schools and provide clinical education, residencies, and
internships for medical and dental students. #ese teaching hospitals (along with
other hospitals not a”liated with a medical school) also provide clinical education and training for nursing and allied health professions students. Teaching
hospitals are typically voluntary, not-for-pro!t or public, government-sponsored
hospitals. Some teaching hospitals operate as part of an academic health center, which comprises an allopathic or osteopathic medical school, one or more
health professions schools (e.g., allied health, dentistry, nursing, pharmacy, public health, veterinary medicine), and one or more owned or a”liated teaching
hospitals or health systems. Academic health centers are heavily involved in clinical research and high-level tertiary and quaternary care, in addition to providing
advanced training and education for clinicians in primary and specialty care.
REHABILITATION HOSPITALS Rehabilitation hospitals specialize in providing therapeutic interventions to help patients regain functional ability to the highest possible
level after an injury or illness that has caused some loss of ability. By Medicare
de!nition, 75% of a rehabilitation hospital’s patients must require intensive (at
least 3 hours per day) rehabilitative services to treat conditions related to stroke,
spinal cord injury, major trauma, brain injury, or other debilitating disease or
injury. Rehabilitative services provided within these facilities include physical
therapy, occupational therapy, and speech-language therapy. Other services may
also be provided to assist patients with psychological, vocational, or social needs
related to their condition.
PSYCHIATRIC HOSPITALS #e primary function of a psychiatric hospital is to provide
diagnostic and treatment services for patients who have a psychiatric-related
illness. Some facilities specialize in short-term or outpatient therapy, whereas
others may specialize in temporary or permanent care of residents who require
routine assistance, treatment, or a specialized and controlled environment as a
result of a psychological disorder. General hospitals may also operate psychiatric
units within their organizations.
Psychiatric hospitals are required to provide clinical laboratory and diagnostic x-ray services in addition to psychiatric, psychological, and social work services. Psychiatric hospitals have written agreements with general hospitals for
the transfer of patients in need of medical or surgical services not available at the
psychiatric institution (AHA, 2018).
OTHER HOSPITALS #e federal government operates approximately 209 hospitals
that are not accessible to the general public. Included among these hospitals are
those operated by the Veterans Administration (VA) for the nation’s military veterans, the Department of Defense (DOD) for active duty military personnel, and
the Indian Health Service (IHS) for American Indians and Alaska Natives.
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28 Part I. Health Policy
Physician Organizations
In the United States, physicians have traditionally been self-employed, working in
private medical practices that they own either solely or in partnership with other
physicians. Hospitals establish relationships with physicians by granting them
admitting privileges to provide inpatient and outpatient procedures and services
to their patients that cannot be delivered within the physician practice setting. In
recent years, however, there has been a trend toward the employment of physicians
by hospitals and other health care organizations and toward larger practice sizes.
!is trend has been attributed to a number of reasons, including stagnant reimbursement rates, a desire for better work-life balance for physicians, and e”orts by
hospitals to increase market share. !e results of a physician practice benchmark
survey in 2016 conducted by the AMA indicate that only 47.1% of physicians have
an ownership stake in their practices, and an equal amount (47.1%) are employees
of either a medical practice or hospital organization. !is marks the #rst year that
the majority of physicians are not practice owners, with a 6% decrease observed
from a prior study conducted in 2012. Additional trends indicate that having an
ownership stake is less common among women physicians than men and less
common among younger physicians than older physicians (Kane, 2017).
As mentioned, physicians may be employed by others (e.g., hospitals, government, medical schools) or be self-employed (i.e., in private practice). A variety of physician practice settings are utilized in the United States, which include
solo practice, single specialty group practice, multispecialty group practice
(MSGP), corporate medical practice, and urgent care centers, among others.
SOLO PRACTICES A physician practice operated by one physician is known as a solo
practice. Approximately 20% of physician practicing in the United States are in
solo practices, compared with 40.5% in 1983 (AMA, 2013). According to the
AMA (2013), a majority of physicians in solo practices own their practice.
SINGLE SPECIALTY GROUP PRACTICES !e most common type of physician practice is
the single specialty group practice: a practice with two or more physicians who
have the same medical specialty, such as internal medicine or cardiology. Fortytwo percent of the physicians in the United States are in a single specialty group
practice (Kane, 2017).
MULTISPECIALTY GROUP PRACTICES A multispecialty group practice consists of two or
more physicians who practice di”erent medical specialties. Approximately 25% of
physicians in the United States are in a multispecialty group practice (Kane, 2017).
CORPORATE MEDICAL PRACTICES Corporate medical practices are physician practices owned by business corporations or entities. !is is commonly known as
the corporate practice of medicine (CPOM). CPOM is prohibited in some
states: !e types of prohibitions vary by state and may be found in various laws,
regulations, or court rulings. A typical exception allows hospitals and health
maintenance organizations (HMOs) to employ physicians because these businesses were established for the purpose of providing treatment to patients and
are licensed entities. Most states allow physicians to provide services through a
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Chapter 2. Organization of Care 29
professional service corporation (P.C.), a business entity formed for the purpose
of providing professional services, such as medical services. Some states have
CPOM laws but do not enforce them. Such laws were established in an earlier
era when concern about the commercialization of medicine led to great e!orts to
ensure that medicine would be practiced only by licensed professionals.
URGENT CARE CENTERS Urgent care centers o!er walk-in, extended-hour access to
individuals with acute illness and injuries that are not bona “de emergencies.
In addition to services found in the typical physician’s o#ce, urgent care centers usually can treat minor fractures and provide intravenous $uids as well as
perform on-site x-ray and laboratory test processing. %ese centers are typically
sta!ed by physicians and other providers and operate 7 days a week, including
holidays, from 8 or 9 a.m. until 7 or 9 p.m. %is is a growth area in the health care
delivery system, with more than 9,000 centers operating nationwide and approximately 300 new centers opening each year.
COMMUNITY HEALTH CENTERS Community health centers (CHCs) provide health care
services, focusing on primary and preventive care, to medically underserved and
indigent populations. Approximately 27 million people are served by CHCs in
10,400 communities in the United States (National Association of Community
Health Centers, n.d.). To receive care at a CHC, an individual must be a resident
of the state in which the center is located, be uninsured, and be poor as de”ned by
federal poverty guidelines. CHCs contract with the state or local health department to provide services to eligible individuals; they also help to provide linkages
to social services and government-sponsored health insurance programs, such as
Medicaid and the Children’s Health Insurance Program (CHIP). CHCs may be
organized as part of a public health department or another health service organization, or as a nonpro”t organization.
Ambulatory Surgery Centers
Ambulatory surgery centers (ASCs) are facilities that provide surgical services
for procedures that are done on an outpatient basis. %is is sometimes referred to
as same-day surgery. ASCs are not physician o#ces, although physicians have
taken the lead in their development.
%e “rst ASC was established in 1970 by two physicians. Today, more than
5,400 ASCs are in operation across the United States. Physicians have some ownership in approximately 90% of the licensed ASCs in the United States. Community hospitals have also partnered with physicians to open and operate ASCs, and
a small percentage of ASCs are entirely hospital owned.
Patients treated at an ASC have already been diagnosed by a physician
and have elected to have an outpatient surgical procedure. All ASCs must
have at least one dedicated operating room and the appropriate equipment to
perform surgery safely and provide quality patient care. %e most prevalent
specialties served by ASCs are ophthalmology, orthopedics, gastrointestinal,
pain management, plastic surgery, and urology (Ambulatory Surgical Center
Association, 2018).
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30 Part I. Health Policy
Long-Term Care Organizations
Long-term care organizations operate facilities for individuals who are not able
to manage independently in the community. !e services provided in these facilities vary depending on the level of assistance needed; services may range from
custodial care and chronic care management to short-term rehabilitative services. Long-term care facilities (LTCFs) may be owned by government entities,
nonpro”t organizations (including churches), or investor-owned corporations.
LTCFs may be independent facilities that are either freestanding or operated
within a continuing care retirement community. LTCFs may be part of a multifacility organization (that is, a chain) or may be hospital-owned as either an
attached or a freestanding facility.
INDEPENDENT LIVING FACILITIES Independent living facilities are multiunit housing
developments that may provide support services such as meals, transportation,
housekeeping, and social activities. !ese facilities are typically utilized by active
senior adults who do not require assistance with ADLs.
Independent living facilities are sometimes operated as part of a continuing
care retirement community, which provides a full range of LTCFs and other
services—an assisted living facility and a skilled nursing facility. !is arrangement
enables seniors to make a transition into a residence that meets their physical
needs as they begin to require more medical assistance. Independent living facilities that do not provide many services beyond a residence are sometimes referred
to as senior apartments.
ASSISTED LIVING FACILITIES Assisted living facilities are available for individuals who
are basically able to care for themselves but may need some assistance with some
daily activities. Assisted living facilities are residential facilities that provide services that may include meals, laundry, housekeeping, medication reminders, and
assistance with ADLs and IADLs.
Most states require licensure for assisted living facilities, and the exact de”nition
of what constitutes an assisted living facility varies among states. Approximately
90% of assisted living services in the United States are paid through private funds,
although a few states allow payment for assisted living through Medicaid waivers.
SKILLED NURSING FACILITIES A skilled nursing facility (or nursing home) is licensed by
the state in which it operates to provide 24-hour nursing care, room and board,
and activities for convalescent residents and residents with chronic or long-term
illnesses or conditions. Special populations served by skilled nursing facilities
include physically or mentally challenged children and adults, and children and
adults with debilitating diseases and/or conditions. Regular medical supervision
and rehabilitation services must be available. !e facilities are sta#ed by health
care professionals including a physician as medical director, registered nurses
(RNs), licensed practical nurses (LPNs), and trained nursing assistants. Skilled
nursing facilities are reimbursed through a variety of mechanisms, including private funds, long-term care insurance, Medicare (for short-term rehabilitation or
subacute care), and Medicaid. Medicaid is the source of payment for 6 out of 10
residents in skilled nursing facilities.
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Chapter 2. Organization of Care 31
Rehabilitation Organizations
Rehabilitative services are provided in a variety of inpatient and outpatient settings, including inpatient rehabilitation hospitals, rehabilitation units in acute
care hospitals, skilled nursing facilities, outpatient rehabilitation centers and
units, and other medical rehabilitation providers.
INPATIENT REHABILITATION FACILITIES An inpatient rehabilitation facility is either a
freestanding inpatient rehabilitation hospital or a unit of an acute care hospital.
Intensive acute rehabilitation services are provided and generally include at least
3 hours of therapy per day for 5 to 7 days each week. !erapy may include physical, occupational, speech, or recreation therapy.
Patients who cannot tolerate intensive therapy in an acute rehabilitation setting may be transferred to a transitional care, long-term care, or subacute care
facility, where less intensive rehabilitation services are provided along with other
medical services (e.g., 24-hour skilled nursing care) needed for convalescence
and recovery.
OUTPATIENT REHABILITATION PROVIDERS Rehabilitation services may be provided on
an outpatient basis—that is, the patient lives at home and visits the facility for
therapy. !erapy plans are developed on an individual basis and typically include
2 to 3 days of treatment per week. Nursing services are usually not included in
the outpatient setting. Centers of care are facilities that provide outpatient rehabilitative services for patients with a particular speci”c illness, such as multiple
sclerosis, Parkinson’s disease, or stroke.
!ree types of providers may qualify for reimbursement for outpatient rehabilitation services by Medicare:
■■ Rehabilitation agencies are organizations that provide integrated, multidisciplinary
programs designed to upgrade the physical functions of handicapped and disabled
individuals through a specialized team of rehabilitation personnel.
■■ Rehabilitation clinics are facilities established primarily to provide outpatient rehabilitative services by physicians. To meet the de”nition of a clinic, medical services
must be provided a group of three of more physicians practicing rehabilitation medicine together, and a physician must be present in the facility at all times during the
hours of operation to perform medical services.
■■ Public health agencies are o#cial agencies established by state or local government
that provide environmental health services, preventive medical services, and, sometimes, therapeutic services.
Integrated Delivery Systems
An integrated delivery system (IDS) is a collaborative network of providers who
work together in a coordinated fashion to provide a continuum of care to a particular patient population or community. Within an IDS, providers work together
through information sharing, shared responsibility, and collaborative resource
utilization (Enthoven, 2016). Many believe integrated delivery systems can help
to address some of the problems associated with the fragmented delivery system
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32 Part I. Health Policy
in the United States and move toward the goals of improving the quality and
accessibility of care while containing or reducing costs.
Integrated delivery systems have existed since the early 1900s, but interest
in the IDS concept began to spread in the 1990s when hospitals and physician
practices consolidated through mergers and acquisitions in the face of changing
reimbursement methodologies from public and private insurers. Interest in IDSs
has surged in recent years during the national health reform debate as experts
have suggested that the IDS approach to health care delivery can improve quality
and reduce costs. Research has shown that IDSs have a positive e!ect on quality,
but there is little evidence of an e!ect on costs or health care utilization (Hwang,
Chang, LaClair, & Paz, 2013).
Two types of integration—horizontal and vertical—are used to create an
IDS. Horizontal integration involves linking organizations that provide the
same level of care, such as a multispecialty group practice. Vertical integration
involves linking organizations that provide di!erent levels of care, for example,
preventive, primary, secondary, tertiary, and long-term care. One of the goals of
an IDS is to provide continuity of care for the patient, which includes continuity of information (e.g., shared medical records), continuity across primary and
secondary care (e.g., discharge planning from specialist to generalist care), and
provider continuity (e.g., seeing the same provider each time).
Emergency Medical Services
An emergency medical service (EMS) provides acute care for medical emergencies that take place outside the hospital setting. EMS is utilized within a community to treat those in need of urgent medical care or to stabilize and transport
patients with illness or injuries who are unable to transport themselves to the
appropriate medical facility. It is a system of coordinated response and emergency medical care involving multiple people and agencies.
EMS is regulated by federal and state governments and may be provided by
paid professionals or, in some communities, by volunteers. “e organization of
EMS varies from community to community, based on state regulation, population density, and topography, and may be provided via public institutions, private
institutions, or a public–private con#guration. Prehospital EMS can be based in a
#re department, a hospital, an independent government agency (such as a public
health agency), or a nonpro#t corporation (such as a rescue squad); EMS may
also be provided by commercial for-pro#t companies. “e essential components
of an EMS system are the same regardless of the provider.
Home Health Care Organizations
Home health agencies and organizations provide medical services in a patient’s
home. Services are typically provided for elderly or disabled patients, or for
patients who are unable to visit a hospital or physician’s o$ce because of weakness after surgery or other reasons. Care provided in the home may be acute,
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Chapter 2. Organization of Care 33
long-term, or end-of-life. Home health primarily involves the provision of skilled
nursing services and therapeutic services (e.g., physical, occupational, and/or
speech and hearing). A home health agency may be a public, nonpro!t, or proprietary agency and may be a subdivision of a larger organization. “e agency
must be licensed by the state in which it operates or receive approval that it has
met all standards and requirements to operate. “ese agencies are also subject
to certi!cation requirements by CMS and may also seek accreditation from an
independent accrediting organization. Home health agencies and organizations
must have policies established by a governing body that must include at least one
physician and one RN, and the services it provides must be overseen by a physician or a registered professional nurse.
Hospice and Palliative Care Organizations
Palliative care services are available for anyone with a serious illness as well as for
patients who are terminally ill. Palliative care may be provided in a hospital, outpatient clinic, long-term care facility, or hospice facility. It is delivered by a team
of specialists, including physicians, nurses, and social workers, and may include
other professionals, such as massage therapists, pharmacists, and nutritionists.
Each facility where palliative care is provided typically has its own palliative care
team; these professionals work in partnership with a patient’s primary physician
and others involved in treating the individual.
Hospice care is provided to terminally ill patients either in their homes (hospice residential care) or in a health care facility (hospice inpatient care) owned and
operated by a hospice organization or health system. According to the National
Hospice and Palliative Care Organization (2018), hospice care programs were
!rst established in 1974 and have grown in number to more than 4,199 Medicare certi!ed programs, including both primary locations and satellite o#ces, as
of 2015. “e majority of hospice programs are o$ered by freestanding, independent agencies (72.2%), and the remainder are part of a hospital system (14.2%),
home health agency (12.9%), or nursing home (0.6%). Hospice programs range in
size from small organizations serving fewer than 50 patients on an annual basis
to large, corporate chains operating programs on a national basis and caring for
thousands of patients each year. In 2015, 32% of hospice programs registered with
Medicare were nonpro!t organizations, 63% were for-pro!t organizations, and
about 5% were government owned and operated.
Pharmacies
Medication is an integral part of health care delivery, and pharmacists play a
signi!cant role in ensuring the safe and e$ective use of medication to achieve
desired health outcomes. “e role of the pharmacist has traditionally been to
dispense medication; that role is now expanding into the direct care of patients
as the use of medication has grown and new technologies are employed in the
medication dispensing and utilization processes.
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34 Part I. Health Policy
Licensed pharmacies include retail pharmacies in the community setting and
hospital or other institutional pharmacies. Community pharmacies include chain
pharmacy organizations (e.g., CVS, Walgreens); pharmacies located within other
large retail organizations (e.g., Walmart, Kroger); and independent, locally owned
and operated pharmacies. !e community pharmacy provides the public with
access to medication, including administering “u shots, and serves as a source of
advice on health issues. Approximately 6 out of 10 licensed pharmacists work in
the community setting. Institutional pharmacies control drug distribution within
a health care facility and help to ensure each patient receives the appropriate drug
and dosage. Institutional pharmacies are involved in highly specialized areas,
including nuclear medicine, intravenous therapy, and drug and poison information. A hospital or health system may also operate a retail pharmacy within its
facilities in addition to its clinical pharmacy operation.
Pharmaceutical Companies and Medical Device Manufacturers
Another integral part of the health care delivery system are the pharmaceutical companies and medical device manufacturers that develop and supply medications, medical supplies, durable medical equipment, and medical devices to
health care organizations and sometimes directly to the public. Not only do these
organizations supply materials needed for the direct care of patients, but they
also play an important role in helping ensure safe and e#ective care.
Medical device manufacturers provide essential products for modern
medical care, including devices that range from CT scanners and surgical robotic
devices to blood pressure cu#s and thermometers. !ese products also constitute a signi$cant portion of the national health expenditure. !e CMS estimates
retail spending on durable medical equipment in the amount of $51 billion and
spending for other nondurable medical products at approximately $62.2 billion
in 2016. !e biopharmaceutical industry comprises the pharmaceutical and
biotechnology industries. Biopharmaceutical companies develop, manufacture,
market, and distribute drugs and vaccines used to prevent and treat diseases. It is
made up of four sectors: pharmaceutical and medicine manufacturers, pharmacy
wholesalers, research and development services, and management of companies
and enterprises. Biopharmaceutical companies spend up to $135 billion annually on research and development, and it is estimated that it takes up to 15 years
to develop a medicine or vaccine. !e biopharmaceutical industry accounts for
nearly 20% of all research and development investment in the United States,
where new drugs must be approved by the Food and Drug Administration (FDA)
as safe and e#ective.
!e industry is sometimes referred to as “Big Pharma” because of its size,
its in”uence over health care legislation, and its e#ect on the cost of health care
delivery. !irty-six of the largest pharmaceutical companies make up the membership of the industry’s professional association, the Pharmaceutical Research
and Manufacturers of America (PhRMA), and invest more money in lobbying
than any other industry in the United States.
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Chapter 2. Organization of Care 35
Other Delivery Organizations
TELEMEDICINE Telemedicine uses electronic communications to exchange medical
information between sites to improve a patient’s clinical health status. Telemedicine services may include primary care and specialist referral services, remote
patient monitoring, consumer medical and health information, and medical
education. Hospitals, specialty clinics, home health agencies, and physicians’
o!ces all use telemedicine. “e services may be o#ered within a single health
care organization or between health care organizations.
According to the American Telemedicine Organization (2018), more than
half of U.S. hospitals are participating in some form of telemedicine, and more
than 200 telemedicine networks with 3,500 service sites exist in the United
States. Emerging models of telemedicine delivery include o#ering specialty consultation services through membership associations that match people in need
of services with providers, and independent businesses that are organized to
provide telemedicine consultation services but are not health care providers.
“ese independent businesses recruit appropriately licensed specialists to provide telemedicine services and then market these services and handle contract
negotiations and all legal and technical aspects of delivery.
Retail Clinics
Retail clinics are medical clinics located in pharmacies, grocery stores, and “big
box” stores such as Target. “ese clinics provide routine care for acute conditions (e.g., bronchitis) as well as preventive care. Retail clinics began emerging in
2000, and more than 2,000 clinics were operating in the United States by 2016.
Retail clinics are often open extended hours and on weekends, o#ering a convenient alternative for routine care, particularly when conventional physician
o!ces are closed. A study by the Rand Corporation indicated that young adults
(ages 18–44) account for 43% of patient visits, although the utilization of retail
clinics by seniors is increasing (Rand Health, 2016). In 2016, three-quarters of
the retail clinics in the United States were operated by two companies—CVS and
Walgreens (Rand Health, 2016). Retail clinics are also operated by hospital chains
and physician groups, accounting for about 11% of the market. Although some
critics of retail clinics voiced concern about the quality of care provided, research
suggests that these facilities provide equivalent quality of care to care o#ered in
other provider settings for a select group of conditions. Most commonly, patients
seek care at retail clinics for acute conditions including respiratory infections and
sore throats. However, these clinics are viewed as promising settings for vaccinations and chronic care management.
Health System Performance
Although the United States spends more money per capita on health care than
any other nation in the world, we are lagging behind other countries on a variety of quality indicators, including average life expectancy and infant mortality
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36 Part I. Health Policy
rates. !e Institute of Medicine (IOM) estimates that more Americans are killed
every year by medical errors than in automobile accidents. As a response to these
staggering statistics, the IOM released Crossing the Quality Chasm (2001), a
landmark report that issued a mandate for improvement in U.S. health system
performance. Additionally, a portion of the ACA is dedicated to improving quality and health system performance through funding research, aligning “nancial
incentives with performance outcomes, and identifying a national quality strategy. Although marginal improvements in quality and performance have been
observed in the past decade, we still have a long way to go to achieve a highperforming health system.
Organizations such IOM, the Institute for Healthcare Improvement (IHI),
and the National Committee for Quality Assurance (NCQA) are leading the
health system improvement movement through initiatives including patient centeredness, the Triple Aim, and the patient-centered medical home (PCMH).
!e CMS is “nancially incentivizing the “meaningful use” of electronic health
records (EHRs) by health care providers to promote quality improvement in
health care. Quality improvement e#orts of this type promote collaboration
among health care providers, payers, the government, and other stakeholders with the goal of achieving real health system change. In the next section
of this chapter, we provide an overview of some of the quality improvement
initiatives that demonstrate the most promise in improving U.S. health system
performance.
The Triple Aim
!e IHI is a not-for-pro”t organization that
is dedicated to improving health and health
care worldwide. !e IHI (2018) promotes a
learning initiative and a framework called
the Triple Aim for health care organizations and communities. !e idea behind the
Triple Aim is that to improve the delivery
of health care in the United States, organizations must simultaneously pursue three
dimensions: (a) improve the patient experience of care, (b) improve the health of populations, and (c) reduce the per-capita
cost of health care.
Achieving this triple aim is di$cult because one organization is rarely
accountable for all three dimensions. However, the IHI has identi”ed “ve system
components necessary for ful”llment of the Triple Aim:
■■ Focus on individuals and families: Care should be customized at an individual level
utilizing families and caregivers as partners.
■■ Redesign primary care services/structures: A team of professionals must be established
that can deliver the majority of necessary care.
The idea behind the Triple Aim
is that to improve the delivery
of health care in the United
States, organizations must
simultaneously pursue three
dimensions: improve the patient
experience of care, improve the
health of populations, and reduce
the per-capita cost of health care.
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Chapter 2. Organization of Care 37
■■ Population health management: Partnerships within the community are necessary to
promote prevention and wellness.
■■ Cost control platform: Cooperative relationships with provider groups must be in place
to control costs.
■■ System integration and execution: Services across the continuum of care must be
coordinated.
Although the Triple Aim initiative is ambitious, a few health systems have
taken on the challenge and have succeeded. A strong focus on primary care, coupled with community alignment, is necessary to achieve positive patient experiences and improvement in population health. Additionally, active physician
participation is crucial to reduce costs. A model of care utilizing a multidisciplinary approach is one way to approach the Triple Aim. Signature Healthcare
achieved success with this approach by initiating a Complex Care Clinic focused
on high-risk Medicare Managed Care patients
Signature Healthcare, located in eastern Massachusetts, provides services to
approximately 10,000 residents over the age of 65. !eir most vulnerable patient
population includes elderly with multiple chronic illnesses, social challenges, and
functional limitations. Signature decided to develop a process focused on providing quality care for this population, and they used the principles of the Triple Aim
for guidance.
1. Signature created a Complex Care Clinic led by nurse practitioners to facilitate the
management of chronic diseases among this patient population. Appointments were
lengthened from 15 minutes to 40 minutes per visit to accommodate patient needs.
Nurse practitioners, in consultation with physician partners and a care coordination
team, took over care management for these patients.
2. Signature engaged community stakeholders in patient care. For example, many
elderly patients needed assistance with transportation, “nances, and meals. Signature engaged local organizations, including the Alzheimer’s Association and the
Visiting Nurse Association, as partners in care. Additionally, they worked with
the local public transportation system to facilitate subsidized transport for these
patients.
3. Signature updated its infrastructure to best serve this patient population. Internal
roles were reassessed, guidelines speci”c to geriatric conditions were put into place,
and screening protocols to help identify seniors at risk for falls were implemented and
integrated into the health record.
Signature’s initiative aimed at managing elderly patients with complex
conditions was successful on a variety of fronts. Patients participating in the
Complex Care Clinic had decreased ED utilization and decreased hospital
admissions. Billing and coding practices improved as a result of the coordinated
approach to providing care. Finally, patient feedback on the new approach to care
was extremely positive, and approximately 98% of patients rated their care as
“very good” (IHI, 2015).
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38 Part I. Health Policy
Patient Centeredness
!e IOM identi”ed patient centeredness as one of six domains that de”ne quality
care. Patient-centered care is “care that is respectful of and responsive to individual patient preferences, needs, and values and ensures that patient values guide
all clinical decisions” (IOM, 2001). Six dimensions to patient-centered care have
been identi”ed (Gerteis, Edgman-Levitan, & Daley, 1993):
■■ Respect for patients’ values, preferences, and expressed needs
■■ Coordination and integration of care
■■ Information, communication, and education
■■ Physical comfort
■■ Emotional support
■■ Involvement of family and friends
Providing patient-centered care means giving patients the information they
need to participate actively in decision making about their care with the goal of
obtaining the most desirable outcome. If a patient is incapacitated or unable to
participate in decision making regarding his or her care, then a family member
or caregiver should be engaged. When a health care intervention cannot provide
a cure, it should aim to alleviate the patient’s su#ering. !e likelihood that an
outcome desired by a patient can be achieved is increased by actively involving
patients and family members in decision making regarding the provision of care.
Although we are making progress in this direction, research suggests that
certain patient-centered practices are still rare. Movements toward the PCMH
and patient-centered research are continuing to shift the momentum in the right
direction; however, there is still a long way to go. !e achievement of a truly
patient-centered health system will require the participation of patients, family
members, physicians, nurses, and other health care providers involved in the
provision of care.
Population Health Management
In terms of the organization of care, there is a growing interest among the payer
community (insurance companies, Medicare, etc.) for providers to engage in
population health management of de”nable patient populations for which they
provide coverage. Provider organizations are engaging in a variety of population
health management activities that involve managing a patient’s care across provider settings. First, e#ectively managing the network of providers that patients
see can help ensure they are receiving the most e$cient and e#ective care for
their conditions. Helping patients navigate physician and specialty care visits can
facilitate information sharing among providers and led to better care outcomes.
Providers are also making e#orts to manage patient transitions of care. A transition in care occurs when a patient moves from one health care delivery setting to
another. For example, a patient might be discharged from an acute care hospital
and require home health services to facilitate recovery. A hospital can manage
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Chapter 2. Organization of Care 39
this transition of care by proactively planning for the discharge with the patient,
family, and home health service.
Provider organizations are also beginning to invest in providing care within
the home for seriously ill patients. Hospitals are trying new ways to embed
resources within the homes of high-risk patients to ensure they remain compliant with medication protocols and remain healthy. Outreach may involve phone
calls, telemedicine services, or simply deploying a practitioner to the patient’s
home. Finally, provider organizations understand that chronic diseases are the
primary drivers of death and disability in the United States. Using data analytics
can help organizations identify chronically ill patients so that their conditions can
be carefully managed (Optum, 2014).
THE FUTURE OF THE DELIVERY SYSTEM
Recent years have seen the introduction of several innovative new models of care
that have potential to realign incentives and improve overall health system performance in terms of cost, quality, and access. !e ACA encouraged the adoption
of these new models, and a variety of new organizational forms have emerged
from the private sector. Renewed interest in physician employment models also
demonstrates potential for increased integration and more closely aligned clinical and “nancial incentives between physicians and other providers.
Innovative Models of Care Delivery
Patient-Centered Medical Homes
!e PCMH model of primary care emphasizes communication and care
coordination. Patient centeredness is an important goal of PCMHs. Physician
practices must meet certain standards to be designated as PCMHs. !e NCQA
released revised standards for PCMHs in
2017 focused around six concepts which
represent the overall themes for PCMH
(see Table 2.1). Evidence suggests that the
PCMH is e#ective at improving health care

Seattle, Washington, provides an example of a successful PCMH model. GHC
is a nonpro”t health system that consists of physician groups, medical facilities,
and health plans that serve Washington and northern Idaho. In 2006, the system
decided to pilot test a PCMH practice. GHC’s pilot practice expanded sta$ng and
emphasized the use of care teams. !e ratio of patients to primary care providers was reduced for the pilot practice, and their enhanced sta$ng model included
physicians, medical assistants, LPNs, physician assistants/nurse practitioners,
RNs, and pharmacists. !e idea behind this increased sta$ng was to facilitate
Evidence suggests that the
PCMH is effective at improving
health care quality and reducing
costs.
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40 Part I. Health Policy
patient relationships and to allow for comprehensive coordinated care. Additionally, patient encounters with clinical sta! increased from approximately 20 minutes
to 30 minutes in duration, and time was set aside each day for teams to create
coordinated care plans (Reid et al., 2010). “e pilot clinic was so successful that
HGC spread implementation of the PCMH model across 25 additional clinics. “e
clinics that implemented PCMH practices experienced better health outcomes,
increased access to care, and improved physician and sta! satisfaction (Reid, 2015).
Health Homes
Health homes were created by the ACA to give states an option for providing
patient-centered, medical home–type services to Medicaid bene#ciaries su!ering from severe or multiple chronic conditions. “e purpose of health homes is
to create a system of care that facilitates and coordinates access to primary care,
acute care, behavioral care, and long-term community-based services. Medicaid
bene#ciaries with (a) at least two chronic conditions, (b) one chronic condition
and high risk for another, or (c) a serious mental health condition are eligible for
health home services.
Health home services are o!ered by
designated providers, teams of health professionals that link to a designated provider,
or a health team. Physicians, group practices,
community health centers, home health
agencies, or any other provider deemed
TABLE 2.1 STANDARDS FOR PATIENT-CENTERED MEDICAL HOMES

Source: Adapted from National Committee for Quality Assurance. (2018). Structure of concepts, criteria, and
competencies. Washington, DC: Author.
Promoting care for the whole
person, care that is individually
tailored to each patient and
family, is a goal of health homes.
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Chapter 2. Organization of Care 41
appropriate by the state is considered a designated provider. Health teams consist
of a physician and other health care professionals such as nurses, social workers,
and other appropriate professionals. Health homes provide care management,
care coordination, health promotion, transitional care from inpatient to other
settings, individual and family support, follow-up care, and referral to community social support services. Additionally, health homes use health information
technology (IT) to coordinate such services. Health homes must provide qualitydriven, cost-e!ective, culturally appropriate care. Promoting care for the whole
person, care that is individually tailored to each patient and family, is a goal of
health homes.
Accountable Care Organizations
Accountable care organizations (ACOs) are groups of providers that share
responsibility and “nancial accountability for providing high-quality, coordinated care to Medicare patients. #e goal of ACOs is to ensure that patients get
the right care at the right time in the most e$cient way. ACOs are organized
around primary care providers, and the high level of care coordination provided
by ACOs is particularly important for the chronically ill. If ACOs are successful at
meeting quality and cost savings targets, these organizations qualify for “nancial
incentives or shared savings from the Medicare program.
#e ACA facilitated the creation of ACOs for the Medicare program. Some
ACO models allow for sharing of “nancial risk and reward for a de”ned population of patients, while other ACOs allow for shared savings based on “nancial and quality targets Family Foundation. In 2018, more than 550 Medicare
ACOs represented approximately 12 million Medicare bene”ciaries. Additionally, provider groups are creating “ACO-like” organizations that strive to
facilitate comprehensive care coordination for patient populations beyond
Medicare bene”ciaries.
Medicare ACOs have demonstrated moderate success in reducing costs and
improving quality for patient populations. In 2016, all ACO types generated
signi”cant net savings and demonstrated lower spending on Medicare services.
In terms of quality, all ACO models had equivalent or better quality than traditional Medicare providers (Kaiser Family Foundation, 2018). Although early
indicators of success are limited, ACOs remain a promising model for improving care coordination and lowering the cost of care for particular populations
of patients.
Beth Israel Deaconess Care Organization (BIDCO) achieved success as one of
the early Medicare “Pioneer” ACOs. It is currently participating with the Medicare program as a “Next Generation” ACO, a program designed for organizations
with experience coordinating care for Medicare bene”ciaries. BIDCO includes
more than 2,500 physicians, a variety of community hospitals, and a network
of providers allowing it to function as an IDS. #ey support providers with a
robust population health program that facilitates regular provider meeting and
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42 Part I. Health Policy
information sharing among network participants. BIDCO attributes its success
as an ACO to several factors:
1. First, BIDCO created an IT infrastructure that allows information sharing among
providers. !is gives providers the information needed to make evidence-based care
decisions.
2. Second, BIDCO worked with a variety of stakeholders from within and outside the
health care industry to redesign processes and “nd a fresh approach to providing care.
3. !ird, BIDCO increased transparency surrounding quality indicators and this
approach resulted in collaboration and competition among providers. !is ultimately
led to improved outcomes.
4. Fourth, BIDCO began to look at data in di#erent ways that factored in the role that
social determinants of health can play in predicting someone’s utilization of services.
5. Finally, BIDCO created an incentive model to motivate physicians to increase individual and system level performance. (Hulbert, 2017)
BIDCO is currently aligned with more than 30,000 Medicare bene”ciaries.
!e organization was able to achieve signi”cant cost savings and perform well on
quality indicators as a Pioneer ACO. After its “rst year of participation as a “Next
Generation” ACO, BIDCO again demonstrated cost savings and produced highquality outcomes (CMS, 2018).
Community-Based Solutions
Social needs of individuals play an important role in contributing to health.
These needs include issues such as housing conditions, access to healthy food,
crime in the community, and poverty. In the current health care environment,
the emphasis on population health and prevention has facilitated the interests of provider organizations in addressing social issues to keep community
members healthy and out of hospitals. Keeping patients healthy is not only
the right thing to do, it is also financially beneficial under new payment methodologies that incentivize health. Although the linkage between social factors
and health has long been recognized, more collaboration between community
resources and provider organizations to provide social services has emerged
in recent years.
One example of such a collaborative is the Staten Island Performing Provider
System (PPS). In 2015, Staten Island University Hospital and Richmond Hill Hospital received funding through the state of New York to form the Staten Island PPS.
!e PPS engaged community-based organizations that provide social services for
citizens such as homeless shelters, food banks, community health centers, and
physicians serving large numbers of uninsured and Medicaid patients. !e provider organizations and social services organizations are working collaboratively
on a variety of projects aimed at improving the health status of the community
and reducing avoidable hospital admissions. Projects include e#orts to better
coordinate care and social services for people with serious conditions, improve
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Chapter 2. Organization of Care 43
health literacy, and implement substance abuse initiatives for at-risk youth
(Sparer, Muennig, & Brown, 2016). Although the PPS is still in its early stages,
this type of collaboration shows promise in improving the health of communities.
Provider organizations are also developing community-based programs
aimed at reducing avoidable hospital readmissions. According to CMS, almost
one of every !ve Medicare patients is likely to be readmitted to the hospital
within 30 days of discharge. “ese readmissions may occur because of inadequate care management resulting from a bumpy transition in care from one
setting to another. Unnecessary readmissions are extremely costly to the Medicare system, and acute care hospitals face !nancial penalties if their readmission
rates are too high. Most importantly, inappropriate readmissions are bad for
patient care. In an e#ort to better coordinate transitions of care, health care providers have found success in reducing readmission rates by seeking communitybased solutions.
“e Care Transition Choices (CTC) program presented by the Partners in
Care Foundation is one example of a successful community-based program
aimed at improving transitions of care for high-risk patients. “e CTC started
as a pilot program established through CMS under the Community Care Transition Program. “e program has been so successful that private health plans
and physician groups have adopted the program and kept it in operation. “e
CTC program works by assigning care transition coaches to work with high-risk
patients on cultivating health self-management skills, review appropriate medication use, and recognize warning signs of a worsening condition. Coaches visit
patients in the hospital and in their homes. In addition to clinical monitoring,
coaches link patients with community resources, including meal delivery and
wheelchair-accessible transportation. “e program has been successful in signi!cantly reducing hospital readmissions among Medicare patients and reducing
costs (Partners in Care Foundation, 2018).
Clinical Integration
Physician–Hospital Alignment
“e alignment of physician and hospital
goals and incentives is a critical success
factor in the era of health reform. Traditionally, both types of provider have been
reimbursed based on volume or productivity. However, reimbursement mechanisms
are becoming more focused on quality and
e$ciency. Identifying ways to align the incentives of physicians and hospitals is
vitally important to maximize the clinical quality of care while minimizing costs.
Di#erent economic levels and approaches to physician–hospital alignment
involve a variety of organizational arrangements. Loosely aligned physicianhospital arrangements involve a traditional independent practice model, in which
Identifying ways to align the
incentives of physicians and
hospitals is vitally important to
maximize the clinical quality of
care while minimizing costs.
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44 Part I. Health Policy
physicians are still “volunteer” members of a hospital’s medical sta! and alignment is sought through contractual arrangements to secure medical directors and
physician administrators. In this traditional alignment model, economic integration is not achieved. Closer alignment might be achieved through more strategic
approaches, such as joint ventures or co-management agreements between physicians and hospitals with some level of shared economic interests. “e ultimate
level of physician–hospital alignment is achieved through employment relationships with full economic integration. With this level of alignment, physicians are
truly employees and are required to comply with hospital policies and share goals
(Sowers, Newman, & Langdon, 2013).
A well-regarded example of an integrated health system is Scripps Health
(www.scripps.org), which includes acute care hospitals, outpatient centers, and
home health and hospice services in the San Diego, California, area. Scripps
employs more than 15,000 workers, and approximately 3,000 a#liated physicians
provide care at Scripps facilities. Scripps Health is a success story in the area of
physician–hospital alignment. In 1999, Scripps was losing millions of dollars a
year and physician and employee con$dence was at an all-time low. A new CEO
created an organizational turnaround by aligning physician and hospital interests
more closely through a co-management approach. Although California law makes
direct physician employment di#cult, closer alignment was achieved through an
integrated foundation model that emphasizes transparency and open communication between physician and administrative leadership. “e CEO was able to
regain physician trust and leverage close alignment with physicians to achieve
$nancial and quality improvements. Since the turnaround, Scripps Health has
been well positioned for growth, and the system has received numerous awards
and accolades, including becoming one of Fortune magazine’s “100 Best Companies to Work For” (Scripps Health San Diego, n.d.). In 2017, Scripps announced
the implementation of a new dyad leadership model that pairs hospital administrators with physician leaders to further align mutual interests.
Physician Employment Models
More complex reimbursement systems are emerging from health reform and the
quality movement. Physician payment is moving from a primarily fee-for-service or
volume-based methodology to a model more dependent on quality and clinical outcomes. As a result of this shift, many physicians are no longer interested in private
practice models. Instead, they are seeking a#liation and employment opportunities
with health systems and hospitals. Physician employment models free up clinician
time so they can focus on providing patient care rather than the business of running
a practice. Employment can be advantageous for hospitals and health systems by
increasing their level of alignment with physician providers. Physician employment
models often tie compensation to quality and productivity metrics.
“e Mayo Clinic (www.mayoclinic.org) is one successful model of physician
employment. Physicians work together with other clinic sta! to care for patients,
and their work is centered on the philosophy that “the needs of the patient come
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Chapter 2. Organization of Care 45
!rst” (Mayo Clinic, n.d.). “e culture of Mayo is unique, rooted in the values of its
founders: teamwork, collegiality, professionalism, mutual respect, and commitment to progress for the organization and individuals. Care is provided by integrated teams of physicians, health care professionals, and scientists. “e Mayo
culture emphasizes team success over individual success. Although physician
employees are provided with a vast array of resources and support, they are compensated with a salary. “is salary structure eliminates any incentives to perform
tests or procedures for !nancial gain. Treatment is purely focused on what is best
for the patient (Mayo Clinic, n.d.).
BEST PRACTICES
Innovative Approaches to Improving Care Delivery
So far in this chapter, we have described several organizations that use innovative
approaches to deliver high-quality health care. Health care delivery organizations
must continue to innovate if they hope to deliver high-quality care while controlling costs. “is section highlights two organizations that have strong reputations
as long-term innovators.
Intermountain Healthcare—Salt Lake City, Utah
Intermountain Healthcare (www.intermountainhealthcare.org) fosters a culture
of innovation. Intermountain is a nonpro!t health care system comprising 22
hospitals, more than 185 physician clinics, and an a#liated insurance company.
“e system has more than 33,000 employees who serve patients in Utah and
southeastern Idaho. “e mission of Intermountain Healthcare is “helping people
live the healthiest lives possible” (Intermountain Healthcare, n.d.). In addition to
pursuing the typical health care delivery activities of an integrated health system,
Intermountain has several programs that nurture a learning environment and
culture of innovation.
Intermountain has several initiatives centered around using technology and
innovation to provide high-quality care at a sustainable cost. Intermountain
Innovations is an e$ort to develop new revenue streams by commercializing
proven clinical and technological innovations. “e Intermountain Simulation
Center capitalizes on technology to provide training for clinicians and employees
that will help promote safety and reduce medical errors among its health team.
Intermountain hosts the Homer Warner Center, a research facility dedicated to
the discovery and implementation of technology through medical informatics.
Of particular prominence is the Intermountain Transformation Lab. “e purpose of this lab is to bring innovation and technology to the patient’s bedside at a
rapid pace. In addition to working with external technology partners, Intermountain’s Healthcare Transformation Lab also provides opportunities for Intermountain employees to develop ideas into new technology. “e lab provides a place for
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46 Part I. Health Policy
clinicians to work with technology experts in developing innovative ideas that
will improve the delivery of health care. Examples of projects targeted by the lab
include designing the patient room of the future, creating a hand-washing sensor
for providers, 3D printing of medical devices for clinical purposes, and creating a
“Life Detector” to notify caregivers of changes in vital signs of patients.
Intermountain hopes to a!ect change in the delivery of health care through
providing educational opportunities and conducting research throughout the
system. Its culture of innovation capitalizes on the knowledge of caregivers and
employees to improve quality and reduce costs (Intermountain Healthcare, n.d.).
The Cleveland Clinic—Cleveland, Ohio
“e Cleveland Clinic (www.clevelandclinic.org) is a multispecialty academic
medical center with a focus on clinical care and research. It houses more than
1,400 hospital beds at its main campus and works with more than 3,000 physicians and scientists. “e Cleveland Clinic’s mission is “to provide better care of
the sick, investigation into their problems, and further education of those who
serve” (Cleveland Clinic, 2018). Quality and innovation are among its core values,
and the clinic is consistently named in U.S. News and World Report’s “America’s
Best Hospitals” survey.
Cleveland Clinic is innovating care delivery by negotiating directly with selfinsured employers as part of its Program for Advanced Medical Care (PAMC).
“e idea behind PAMC programs is to allow employers to provide their employees with access to world-class health care at a reasonable price. Bundled payment programs and transparency in quality outcomes make the Cleveland Clinic
a natural choice for large employers interested in securing greater value in their
health care purchases. PAMC’s #rst agreement of this kind began with Lowe’s
Companies in 2010 to provide heart care for its more than 200,000 employees.
“e clinic recently expanded its cardiac program by contracting with Walmart
and is now focusing on marketing packages of orthopedic procedures to large
employers. Promoting this form of “domestic medical tourism” may change the
way care is delivered, or at least promote transparency among health care providers in terms of quality and pricing (Cleveland Clinic, 2018).
CONCLUSION
“e U.S. health care delivery system can look forward to many changes on the
horizon. Uncertainty surrounding the ACA continues to push providers to continually improve quality and manage costs. Innovative new forms of delivering
health care will continue to emerge to meet the demands of both patients and
purchasers of health care. Health care delivery organizations that fail to evolve
and learn will face a di$cult road. “ose organizations that focus on innovation
and knowledge creation will be well positioned for the future.
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Chapter 2. Organization of Care 47
CASE EXERCISE—INNOVATIVE IDEAS
You have just been promoted to work as the assistant to the CEO of a large, partially integrated
health care delivery system. Your first assignment is to identify several innovative ways to
improve health system quality, control costs, and maximize access to care for citizens in your
community. Opportunities exist to improve physician-hospital alignment and to provide more
integrated care across health system entities. Draft a memo to your CEO that answers the
following questions:
1. What are five innovative ideas your health system could implement to meet improvement
goals around cost, quality, and access?
2. What innovation or innovative idea is the most critical to ensure the health system
achieves its goals?
3. What innovation will be the most difficult to achieve? Why?
4. Why will the implementation of these innovative ideas improve health system
performance?
t
DISCUSSION QUESTIONS
1. !e U.S. health system is shifting its focus to wellness and prevention. Give an example of the three forms of prevention. How should emphasis on prevention alter the
delivery of health services in a particular community?
2. The baby boomer generation, which represents a significant portion of the U.S.
population, is reaching an age when its utilization of health services will most
likely increase. Additionally, life expectancy continues to improve with advancements in medicine and community health. Discuss how this aging of such a large
segment of the population will affect specific health care delivery services and
organizations.
3. Most health care in the United States is delivered in traditional settings such as hospitals, physician organizations, and long-term care organizations. However, access to
new delivery settings is becoming more readily available, and demand for care delivery through telemedicine and retail clinics is increasing. Give an example of an application for telemedicine. Discuss how the utilization of telemedicine might a”ect cost,
quality, and access to care in the U.S. health care system.
4. Although the United States spends more money per capita on health care than any
other country in the world, its performance has much room for improvement. How
can ideas such as the Triple Aim initiative or patient centeredness help to improve
performance in the U.S. health system?
5. Discuss why coordinated care delivery approaches, such as PCMHs or ACOs, might
improve care for patients. Discuss barriers and opportunities for implementation of
such coordinated care delivery approaches.
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48 Part I. Health Policy
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Chapter 2. Organization of Care 49
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3
The Politics of Health Care
in the United States
Rogan Kersh and James Morone
LEARNING OBJECTIVES
▶ Understand the health care infrastructure
▶ Explain the effect of spending on the health care infrastructure
▶ Describe the politics of Medicare and Medicaid
▶ Discuss the impact of politics on the health care delivery system
▶ Explore how personal health decisions become public
KEY TERMS
▶ access
▶ administrative efficiency
▶ innovation
▶ patient outcomes
▶ policy issue
TOPICAL OUTLINE
▶ Costs for health care infrastructure
▶ Many dollars are spent on health care but to what effect?
▶ The politics of Medicare and Medicaid
▶ The role of politics in equitable health care services
▶ Personal health decisions become public: obesity
© Springer Publishing Company DOI: 10.1891/9780826172730.0003
Copyright 2019. Springer Publishing Company.
All rights reserved. May not be reproduced in any form without permission from the publisher, except fair uses permitted under U.S. or applicable copyright law.
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AN: 1998657 ; James R. Knickman, PhD, Brian Elbel, PhD, MPH.; Jonas and Kovner’s Health Care Delivery in the United States, 12th Edition
Account: s3563253.main.ehost
52 Part I. Health Policy
INTRODUCTION
It is the best of health care systems; it is the worst of health care systems—at least
among rich nations. Health care in the United States is a point of cultural pride (“!nest in the world!”). It is the nation’s largest economic sector, at $3.5 trillion in annual costs and
approaching 20% of U.S. GDP (gross domestic
product). It is a moral issue, given low-income
Americans’ terrible health care outcomes,
dragging the national average below other rich
countries on most measures of population health,
including maternal mortality and life expectancy
at birth. It is a policy issue because every one of these dimensions (quality, costs,
injustice) feed into heated congressional, White House, and state/local legislative
discussions. And health care is, of course, a deeply personal matter: It is about the
human condition, about wellness and su”ering, sickness and death.
#e modern American health care system was forged by political choices.
#e United States experienced furious debates about whether to cover all citizens through a government program (in the 1940s), even as most other wealthy
democracies were organizing such programs. It deployed tax policy to foster a
private, employer-sponsored health insurance coverage industry (1950s). It !lled
the gaps in coverage for some of America’s poor and almost all people over 65
with two programs, Medicare and Medicaid, legislated in 1965 (and now swallowing a quarter of the federal budget and, on average, a !fth of state budgets).
Every presidential administration in the past 80 years—Democratic and Republican, liberal and conservative—has proposed major changes in health policy. Both
the Barack Obama and the Donald Trump administrations zoomed in on health
care in their !rst months. In short, the battle over the shape of American health
care is constant (Blumenthal & Morone, 2008; Henry Kaiser Foundation, 2016).
#is chapter takes up three main dimensions of the U.S. health care system,
emphasizing throughout the central role of politics and policymaking. We
begin with the basics—America’s national health infrastructure and how medical services are !nanced. Next we zero in on health insurance, which inspires
especially heated policy debates (more technical reviews of issues related to
!nancing and health insurance are presented in Chapters 10 and 11). A third
primary theme is health disparities among Americans: Geography, a proxy
for wealth and poverty, is a major determinant of health outcomes (this topic
is covered in more detail in Chapter 8). After describing the political context
for health care, we take up a speci!c issue—obesity—and detail how political
maneuvering shapes health matters that many Americans still consider personal, not a matter of government regulation. As both history and contemporary practice show, many ostensibly private matters in the health domain have
Despite the United States’
enormous spending on health
care—the highest in the
world—patient outcomes lag
behind those of comparable
countries.*
*To hear the podcast, go to https://bcove.video/2zHJ1v7 or access the ebook on Springer Publishing ConnectTM.
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Chapter 3. The Politics of Health Care in the United States 53
been the subject of public regulation—even in the famously individualistic,
anti-government United States.
At the core of health politics and policy
is the question of whether individuals have
a right to health care or whether it should
be treated as any other market good, like
clothes or food or cars. Most wealthy democratic countries view health care as a foundational human right and provide at least a
basic level of health services to all residents;
some, like Canada, aim for a universal right
to equal care (Chapter 4 focuses in more detail on a comparative global health
perspective). Uniquely among advanced democracies, the United States views
health care not as a right but a patchwork: an entitlement for most people over
65, a perquisite of employment in some companies and sectors, and a service to
be purchased either as insurance or at point of service for millions of others. !e
United States is among a handful of countries not to have rati”ed a UN treaty
declaring health care a fundamental human right (UN o#cial text, 2018).
Our idiosyncratic health system has always been shaped by political
debates—drawing in policymakers as well as large employers, private insurance companies, and professional medical decision makers. !is chapter
examines whether the result of all that politicking is better health outcomes
for most Americans. Our main aim in this chapter is to clarify the roles of policymaking and politics in the U.S. health system. Our discussions of “nancing,
insurance, and obesity as a behavioral health issue and comparative health care
are meant to complement other chapters in the book and to provide context
for the exploration of the dynamics of politics and policymaking in the world
of the U.S. health system. Our aim is to communicate how politics and policy
impact the health system and how political scientists approach the topic of
health care.
HEALTH CARE INFRASTRUCTURE AND SPENDING:
MANY DOLLARS, TO WHAT EFFECT?
!e U.S. system of delivering and “nancing health care is the most complicated
among advanced countries. Some nations, like Great Britain, manage health care
through the government; others, like Switzerland, rely on the private market
(with government subsidizing care for the least well-o$). Still others—Singapore,
for example—mix government-run care for low-income residents with a private
system (Gusmano & Rodwin, this volume). !e United States includes elements
of all three. Complicating matters further, treating patients and paying for those
treatments are managed by di$erent collections of institutions. !e one-word
summary: fragmentation.
At the core of health politics and
policy is the question of whether
individuals have a right to health
care or whether it should be
treated as any other market
good, like clothes or food or cars.
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54 Part I. Health Policy
Providing Health Care
Let’s start with government-provided care. American military veterans receive
health care from more than 1,200 hospitals and clinics managed by the Veterans
Health Administration (VHA). More than 305,000 VHA health professionals and
support sta! tend to some 9 million veterans each year, making this the largest
health system in the United States. Veterans’ complaints in recent years about
long waits for care and elaborate eligibility rules have resulted in diminished
approval ratings for the VHA, even as it spends nearly $200 billion annually (VA
Health Care, 2017). Along with this federal management of veterans’ care, state
and local governments also run public clinics and hospitals, which help serve
those who can’t otherwise a!ord care. Moreover, members of the armed forces
and their families receive care through services organized by each branch of the
federal military. Overall, about a quarter of U.S. health care delivery is through
these various government-run entities.
“e remaining three-quarters of hospitals and clinics are run by private companies, which are deeply enmeshed in the U.S. health care system. Of those clinics
and hospitals that are private, about 70% are nonpro#t—managed by universities,
religious institutions, charities, or nonpro#t networks. “e remainder are forpro#t, often organized into large systems: the Hospital Corporation of America,
for example, based in Nashville, Tennessee, manages more than 175 hospitals in
the United States and the United Kingdom, with annual revenues of more than
$3 billion.
What about prescription drugs and other pharmaceuticals? “e U.S. drug
industry is almost entirely private—an economic behemoth with global reach,
approaching $500 billion in annual sales. By comparison, in most other advanced
democratic countries, the government purchases and distributes prescription
drugs.
What di!erence does it make that so
much of the U.S. health infrastructure is outside government supervision? A lot: In most
advanced countries, a central government
body (like the United Kingdom’s National
Health Service, or China’s Ministry of Public
Health) provides strategic planning; determines where additional doctors, nurses,
and other health professionals are needed
(and whether there are su$cient hospitals
and clinics to house them); and pays most
of the cost of care. In the United States, privately managed care facilities are free to open or close where and when they wish.
America has no national health planning; individual states and large cities monitor their health systems, regulate providers, and collect reams of health data—but
do not wield direct in%uence on the provision of care. “e result is a hodgepodge
The U.S. drug industry is almost
entirely private—an economic
behemoth with global reach,
approaching $500 billion in
annual sales. By comparison, in
most other advanced democratic
countries, the government
purchases and distributes
prescription drugs.
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Chapter 3. The Politics of Health Care in the United States 55
of some often-superb facilities, especially in higher-income neighborhoods, and
many places (especially inner cities and rural areas) devoid of !rst-rate medical
institutions or professionals.
Although the U.S. system lags behind
almost every wealthy nation in health outcomes—more on that later—America does
lead the world in health innovation: developing new treatments, medical instruments, and drugs for the bewildering array
of diseases and health conditions that beset
us. More than 60% of health research and
development (R&D) funding is carried
out by private industry; another quarter is
funded by the government, often as grants
to university researchers, many of whom
work closely with private companies to license their discoveries for sale. Nearly
150 U.S. universities also manage large health care systems, organized around
teaching hospitals where the next generation of medical professionals are trained.
In sum, if you get sick in the United States, are not in the military or a military veteran, and need to see a doctor, chances are high that she will be privately
employed—though likely in a nonpro!t hospital or clinic. If you are under 65,
unemployed, and uninsured, you may seek care at an emergency room or a low/
no-cost public clinic. Should you receive a prescription, you’ll probably go to a
private pharmacy like CVS or Walgreens and buy (with help from insurance,
which we talk about below) drugs or other palliative services. “ose pharmaceuticals (or insulin treatments, special bandages, etc.) were likely produced by
private companies, though the R&D may well have involved government-funded
research in university or public laboratories at places like the Centers for Disease
Control and Prevention (CDC), a government agency.
Perplexed yet? Health care provision in the United States is a tangled mixture of national, state, and local government; private companies, both forpro!t and nonpro!t; universities and nonpro!t health-advocacy organizations;
and medical professionals spread across all these groups. “is multi-layered
complexity—sitting atop an equally complicated !nancing arrangement, discussed in detail in the following—is part of the reason that Americans far outstrip the rest of the world in health care spending. Let’s take a look at where that
annual $3.5 trillion goes.
Health Care Spending
Figure 3.1 provides a summary of how American health care dollars are spent.
Note that this arrangement—nearly a third of total funds spent on hospital care, for example—is not ordained by law or medical best practices but
Although the U.S. system lags
behind almost every wealthy
nation in health outcomes,
America does lead the world in
health innovation: developing
new treatments, medical
instruments, and drugs for the
bewildering array of diseases and
health conditions that beset us.
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56 Part I. Health Policy
re!ects a mix of tradition, strategic decisions, investor choices, and political
compromises. Many other countries spend a higher percentage of their health
dollars on government administration (1.2% in the United States) because their
systems are subject to central control. Most others also spend a far lower proportion of their health dollars on prescription drugs (approaching 11% in the
United States)—mainly because their national government purchases drugs in
bulk quantities and manages their distribution. As we will see below, U.S. political debates on funding prescription drugs tend to rule out such centralized government purchases.
“e United States is also distinctive in terms of how much it spends on health
care: by a considerable margin, the world’s most per capita. Figure 3.2 lists the top
health-spending countries per person.
With the United States considerably ahead of other wealthy nations—
spending twice as much as the average peer country—questions arise about
what lies ahead. “Bending the health cost curve” downward has been a
priority for health policymakers for decades; President Richard Nixon
warned darkly that “we face … a breakdown in our medical system,” caused
by rising costs, back in 1969 (Nixon, 1969). Fifty years later, costs continue
to rise.
32.7
15.5
5 4.2
3.1
14.6
10.4
6.4
2.3
4.7
1.2
Hospital Care Physician Services Clinical Services Long-Term Care
Home Care Other Personal Care Prescription Drugs Net Insurance Cost
Government
Public Health
Investment Government
Administration
Source: Data from the Department of Health and Human Services (DHHS) and !e Centers for Medicare
& Medicaid Services (CMS).
FIGURE 3.1 DISTRIBUTION OF U.S. HEALTH CARE SPENDING: 2018
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Chapter 3. The Politics of Health Care in the United States 57
Bending the Cost Curve? Health Spending
in Coming Years
Given the convoluted U.S. infrastructure, the
job of providing high-quality health services
is demanding—and becomes more di!cult
as costs soar. After a drop in annual increases
after the A”ordable Care Act (ACA)’s passage, costs have begun again to rise steadily,
with prescription drug increases leading the
way. Other drivers of the current boost in U.S. health expenses include higher
costs for out-of-pocket care, rising Medicare expenses as a swelling number of
baby boomers age into the program, and ACA premium hikes—the latter a consquence of executive branch regulatory actions designed to weaken the ACA.
In a sentence, why do Americans pay so much for health care? Because U.S.
providers charge more for the same service. Without a single regulator negotiating prices, costs are simply passed along (Cuckler et al., 2018). To understand the
United States $10,348
Switzerland $7,919
Germany $5,550
Netherlands $5,385
Austria $5,227
Comparable
Country Average $5,169
Belgium $4,839
Canada $4,752
Australia $4,708
France $4,600
Japan $4,519
United Kingdom $4,192
Source: Data from Peterson-Kaiser Health System Tracker.
FIGURE 3.2 TOTAL HEALTH EXPENDITURES PER CAPITA (U.S. DOLLARS): 2016–2017
Given the convoluted U.S.
infrastructure, the job of providing
high-quality health services is
demanding—and becomes more
dif!cult as costs soar.
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58 Part I. Health Policy
complexities of rising health costs, and the central role of political decisions, let
us look more closely at prescription drugs.
Pharmaceutical companies raised prices well beyond in!ation with the advent
of the Trump administration: After growing by around 2% annually, drug costs
leapt upward by 4.4% during 2017–2018. As a study by Pharmacy Bene”t Consultants (PBC) shows, 40 prescription drugs had price increases of more than
100% across the 15 months since January 2017; more than 225 drugs cost at least
a third more (Pharmacy Bene”t Consultants’ comparison, 2018). Current projections are for annual drug cost increases of some 6.5% over the next decade.
Pharmaceutical company representatives argue that higher costs are driven by
increased use of specialty drugs to treat cancer and genetic disorders, but those
skyrocketing fastest on PBC’s list include drugs for bee stings, bedwetting, and
prescription skin cream.
U.S. drug costs are more than twice as
high as the average for other industrialized
countries, a gap larger than that for nearly all
other consumer goods. Public policy decisions are a major reason. In contrast to most
other countries, the American government
guarantees extended monopolies to drug
companies, with generic alternatives that would dramatically reduce prices often
held up for years by litigation. Exacerbating this political decision, Medicare’s
initial passage included a compromise, since rea#rmed many times by Congress,
that the Centers for Medicare & Medicaid Services (CMS) cannot use its immense
bulk-purchasing power to negotiate lower prices with drug manufacturers. CMS
payment plans are also required by Congress to cover nearly all drugs, rather
than concentrating on the most frequently prescribed (and/or cheaper) medications (Kesselheim, Avorn, & Sarpatwari, 2016). Companies routinely claim that
the high costs of research and development, along with long delays in Food and
Drug Administration (FDA) approval of new drugs, keep their costs high. But academic analyses “nd at best mixed evidence of association between R&D expenses
and drug prices (Jaroslawski, Auquier, & Toumi, 2017; Kesselheim, Avorn, & Sarpatwari, 2016), and the FDA’s swifter drug approval processes in recent years has
not resulted in a commensurate price reduction for new pharmaceuticals.
A “nal reason for unusually high prescription drug prices is the fragmentation of the industry. Drug companies utilize distributors for their products, who
add a hefty premium to the price of every drug. How much do they add? Drug
companies are not permitted to list their prices before the distributor markup. It
is a fragmented system is rife with opportunities for “investment.” Budget-minded
policymakers, restricted at every turn from addressing these well-protected political decisions, can agree only that innovative policy moves are an essential part
of the solution to sharply rising prescription drug prices (Alexander et al., 2017;
Frank & Zeckhauser, 2018).
For a blend of reasons, then—manifestly including politics—U.S. health
spending is the world’s highest. What do we get for all those dollars expended?
U.S. drug costs are more than
twice as high as the average for
other industrialized countries, a
gap larger than that for nearly all
other consumer goods.
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Chapter 3. The Politics of Health Care in the United States 59
Across the !rst two-thirds of the 20th century, America was among world leaders
in terms of health outcomes, ranking near the top in areas like infant mortality
and life expectancy. In recent decades, almost every wealthy nation has surpassed
the United States on primary measures of mortality and morbidity. As we will
explore, these are average measures; they mask enormous di”erences between
rich and poor.
Patient Outcomes and Beyond: Evaluating American Health Care
Assessing health care systems is a complex science (Gusmano & Rodwin, this
volume). A hospital that rates highly on curing patients may actually turn away
the sickest cases. Nuanced assessment measures are therefore required. Along
with patient outcomes, analysts now evaluate health care systems in four additional areas: access (is health care availability timely and a”ordable?), care process (including such vital aspects as patient safety, preventive care, coordinating
care across di”erent health providers, and health professionals’ engagement with
patients), administrative efficiency (measuring whether the immense bureaucracy required to operate health systems work smoothly and swiftly), and equity
(do all who seek care receive similar treatment?). Chapter 12 reviews the topic of
quality improvement in more detail.
Since health care systems exist to enhance people’s health and well-being,
patient outcomes top the list of evaluative criteria. Here the United States performs poorly, compared to peer nations. On an Institute of Medicine comprehensive study of 17 high-income countries, Americans scored at or near the worst on
nearly all of nine measures, including frequency of homicides, incidence of heart
and lung disease, infant mortality, obesity, disability rates, frequency of car accidents, and sexually transmitted infections among teens (Woolf & Aron, 2013).
Together, these features drive down life expectancy. According to latest Organisation for Economic Co-operation and Development (OECD) estimates, Americans born in recent years can expect to live to age 78.8 on average—a full 5.1 years
less than in Japan, and not in the world’s top 30 countries—ranking below Chile,
Slovenia, and Cuba (Kochanek, Murphy, Xu, & Arias, 2017; OECD, 2017).
On the other above-listed dimensions, from system e#ciency through
equity, the United States is also a relatively low performer. Figure 3.3 summarizes an analysis of all !ve evaluative dimensions by the Commonwealth Fund,
a global health policy research organization (Schneider et al., 2017). As you
can see, the United States scores highest—!fth overall—on care process, thanks
to preventive measures like mammography screening and provider–patient
engagement, ranging from wellness counseling on healthy behaviors to end-oflife discussions with health providers. Otherwise, American health systems perform poorly. $e United States ranks next to last in administrative e#ciency and
!nishes at the bottom in the other three areas. Add up the results and America
!nishes last overall among wealthier countries.
$e American combination of high health spending per capita—31% higher
than Switzerland, the second most expensive—and lagging patient outcomes is
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60 Part I. Health Policy
a source of concern for U.S. health providers and policymakers alike (Papanicolas, Woskie, & Jha, 2018). Figure 3.4 combines these two comparative features—
higher costs and poorer results—in a compelling juxtaposition. Among the world’s
25 largest economies, the United States outstrips all others on expense (farthest
right, along x axis) and lags most on life expectancy (farthest down on y axis).
Part of the reason U.S. health care is so expensive—and partly why outcomes
are poor compared to other advanced countries—involves how it is !nanced.
When it comes to who pays for insurance and delivering health care services, here
again complexity rules. And also again, political debates and deals are central to
America’s convoluted architecture of health !nancing.
WHO PAYS? THE POLITICS OF MEDICARE, MEDICAID,
AND MUCH MORE
Some 18% of the U.S. GDP (all goods and services a nation produces) is devoted
to health services, a percentage that continues to rise—and that is higher than
peer nations, which typically spend around 10% of GDP on health care. Financing those huge health costs involves a jumbled mixture of national, state, and
local government; private insurance companies; individual payers; and private
charities. Figure 3.5 illustrates the mix of payment sources for U.S. health care.
Look carefully at the !gure and you’re probably in for a surprise. “e largest source of health insurance in the United States is the government: Medicare
(a federal government program), Medicaid (joint federal and state), and other
Source: Retrieved from Commonwealth Fund.

FIGURE 3.3 EVALUATING HEALTH SYSTEMS: COMPARING 11 WEALTHY COUNTRIES
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Chapter 3. The Politics of Health Care in the United States 61
70
0 $500 $1,000 $2,000 $3,000 $4,000
Health Expenditure
(adjusted for inflation as well as purchasing power parity [PPP] for price differences between countries)
Life Expectancy (Years)
$5,000 $6,000 $7,000 $8,000 $9,000
71
72
73
74
75
76
77
78
79
80
81
82
83
84
USA
Chile
South Korea
Israel
Greece
AustraliaFrance
Luxembourg
Canada
Sweden
Denmark
Belgium
Finland
UK
New Zealand
Ireland
Germany
Norway
Switzerland
AustriaNetherlands
Spain
Japan
Italy
1995
1970
1975
1980
1985
1990
2000
2010
2005
2014
Source: Financing Healthcare by Esteban Ortiz-Ospina and Max Roser. Retrived from !e Economist.
FIGURE 3.4 LIFE EXPECTANCY VS. HEALTH EXPENDITURE: 25 COUNTRIES, 35 YEARS
programs amount to 41% of insurance coverage. Together, these giant entitlement
programs (only Social Security is larger) account for approximately $1.18 trillion
in government spending, a !gure that by 2026 is expected to top $2 trillion. Private plans account for 34% of health care insurance (see Figure 3.5). “e next biggest slice: “out of pocket.” People pay at the
point of service, either to cover cost sharing
(which can run to thousands of dollars) or
because they have no insurance.
Ironically, because they have no negotiating leverage, uninsured individuals face
higher prices than the insurance companies
Ironically, because they have
no negotiating leverage,
uninsured individuals face
higher prices than the insurance
companies pay.
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62 Part I. Health Policy
FIGURE 3.5 PAYMENT SOURCES FOR U.S. HEALTH CARE
Health Insurance,
75%
Government
Public Health
Activities,
2%
Other Third
Party Payers
and
Programs,1
8%
Investment, 5%
Out of Pocket,2
11%
Private Health
Insurance,
34%
Medicaid
(Title XIX)
Medicaid Federal, 11%
(Title XIX)
State and
Local, 6%
VA, DOD, and CHIP
(Titles XIX and
Title XXI), 4%
Medicare,
20%
1 Includes worksite health care, other private revenues, Indian Health Service, workers’ compensation, general assistance, maternal and child
health, vocational rehabiliation, Substance Abuse and Mental Health Services Administration, school health, and other federal and state local
programs.
2 Includes copayment, deductibles, and any amounts not cover by health insurance.
Source: Retrieved from CMS.
Note: CHIP, Children’s Health Insurance Program; DOD, Department of Defense; VA, Veterans
Administration.
pay. Bill Clinton starkly pointed out the problem of individual payers back in
1993: “our grandchildren will !nd it … unthinkable that there was a time in this
country when hardworking families lost their homes, their savings, their businesses, lost everything, simply because the children got sick” (Clinton, 1993).
Despite years of policy e”orts, Clinton’s lament remains true today. One study,
by the Kaiser Foundation, concluded that roughly a quarter of Americans have
trouble paying medical bills and that the bills have had “a major impact on the
family”—often including bankruptcy (Hamel, Norton, Pollitz, Levitt, Claxton, &
Brodie, 2018).
Along with soaking up a signi!cant majority of spending, health insurance
is essential to enable people to a”ord the spiraling costs of treatment, among
many other bene!ts (Sommers, Gawande, & Baicker, 2017). No American political battleground has been more !ercely contested in recent years than how health
insurance is provided and paid for.
In a majority of the world’s nations, health care is free to residents, with
insurance provided mainly by the national government. Fall ill in any of 160
countries—from Costa Rica to Zambia, Pakistan to Denmark—and you can seek
care secure in the knowledge that government-paid insurance will cover the cost
of your treatment. In a smaller group of countries, the private market is a main
source of insurance. In Switzerland, for example, the government mandates that
everyone have health coverage but does not provide it: Instead, Swiss purchase
individual plans from more than 100 private companies. (Government subsidies
are provided to people in lower income brackets, on a sliding-scale basis.)
#e U.S. system is a patchwork, the result of political compromises on Capitol
Hill, state legislatures, city councils, employers, health care institutions, health
care professionals, the White House, and more. How did we get to this tangled
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Chapter 3. The Politics of Health Care in the United States 63
and fragmented nonsystem? We turn now to a closer look at the peculiar political
history of health insurance in America.
Health Insurance Reform: A Brief Political History
President Harry S. Truman (1945–1953) ran for reelection in 1948 touting
his national health insurance plan; it was his top domestic priority. However,
Congress—dominated by conservative Southern Democrats—buried the issue.
!e powerful chair of the Senate Finance Committee declined even holding
hearings on the proposal. If the United States operated as a parliamentary
democracy, like Germany or Canada, the president would have been able
(indeed, expected) to pass the program he promised in the campaign. National
health insurance fell short—thanks to the American government of checks and
balances (Blumenthal & Morone, 2008).
Republican President Dwight D. Eisenhower (1953–1961) was eager to build
a private insurance alternative to Truman’s plan. His administration made permanent a tax deduction to encourage employers to o”er health insurance to
workers—and the private health insurance system took o”. Note that it was
#nanced by a conscious policy decision: what political economists call a tax
expenditure, one that cost the federal government $253 billion in 2018.
With John F. Kennedy’s win in 1961, Democrats resurrected the Truman plan,
reduced its scope to cover only those over 65, and renamed it Medicare. !eir
hope was that it would prove so popular that the rest of the population would
demand coverage, too. In a legislative coup, planned by President Lyndon Johnson (1963–1969) and the chair of the Ways and Means Committee, Wilbur Mills
(D-AK), Congress passed not just Medicare but two counterproposals introduced
by the Republicans and the American Medical Association. !e #nal legislation
included a federal program that paid hospital and physician costs for people over
65 (Medicare) and a federal state program, administered on the state level, that
paid for some categories of poor people, mainly families with dependent children
(Medicaid). Even with these limits, opponents denounced the Johnson/Mills program as “socialized medicine.” Only 10 House Republicans voted for it, though
most changed to “aye” votes after failing to bury the bill (Berkowitz, 2005; Blumenthal & Morone, 2008).
!ese two programs eventually came to cost a quarter of the entire U.S. federal budget. Periodic expansions of Medicare and Medicaid still left millions of
Americans without insurance, at the mercy of a frayed health care safety net. By
the early 1990s, nearly 20% of Americans under 65 (the cuto” age after which
Medicare provides insurance), or just under 40 million people, had no health
insurance. President Bill Clinton, after signing in 1993 a massive bill designed to
bring the federal budget back into balance, turned to health care reform. A multiplicity of health care changes were blended into one of the most ambitious legislative e”orts since World War II, with extension of insurance at the measure’s heart.
Opponents, again trumpeting the dangers of government-mismanaged health
care, were able to defeat the e”ort, thanks in part to widely watched television
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64 Part I. Health Policy
advertisements starring an innocuous American couple, Harry and Louise, worrying aloud about the devastating e!ects of “letting government choose: We lose.”
“e Clinton administration assisted opponents by taking a year to design
and submit its plan. As Lyndon Johnson well understood, such massive proposed
changes very rarely can navigate the American system of multiple vetoes beyond
a year after a presidential election. A more focused expansion of insurance for
around 660,000 low-income children, known as the Children’s Health Insurance
Program (CHIP), won bipartisan support and passed in the wake of the Clinton
health-reform collapse. Today an expanded CHIP serves nearly 9 million children
annually.
Barack Obama submitted his health insurance expansion within 2 months of
taking o#ce and, after a year of blistering politics in Congress and in congressional town hall meetings dominated by the rising Tea Party, managed to win passage by February 2009. “e legislation $nally squeaked through without a single
Republican vote. In marked contrast to past reforms (Social Security in 1935,
Medicare/Medicaid in 1965), Republicans did not shift their $nal votes to “aye,”
but kept right on resisting (Ho!man, 2003).
To date, “Obamacare” has extended coverage to some 20 million people, around two
$fths of those uninsured before the ACA
was enacted. It involves two major programs. First, it subsidized private insurance
and required people to purchase it. Second,
it put aside the state-by-state Medicaid
patchwork and expanded the program to
cover everyone under 138% of poverty (today, about $32,000 for a family of four).
Notably, the $rst is the kind of program once sponsored by Republicans; the latter
expands a classic big-government program legislated during the Johnson years.
Implacable Republican opposition continued. A Republican-led Congress
staged more than 100 votes between 2011 and 2018 to repeal the law and twice
advanced repeal to the U.S. Supreme Court, where it failed both times by a 5–4
margin. Donald Trump, whose 2016 presidential campaign was built in part
around a promise to eliminate the ACA, dismantled portions of the law through
executive orders and ordered sweeping cutbacks in federal advertisements
during periodic enrollment periods.
One target of Republican ire is the ACA’s individual mandate, which requires
most people to have insurance. In order to $nance care for sick people, healthy
ones must pay into the system—and they, in turn, receive a!ordable health services should they fall ill. To ensure compliance with the mandate, a $nancial
penalty is charged to those who fail to sign up for insurance (which is heavily
subsidized for the poorest Americans). President Trump issued an executive
order in 2017 ending that penalty; months afterward in summer 2018, his Justice
Department issued a ruling that the mandate itself was unconstitutional (Beech
& Lambert, 2018), despite congressional passage and two a#rmative decisions in
To date, “Obamacare” has
extended coverage to some 20
million people, around two !fths
of those uninsured before the
ACA was enacted.
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Chapter 3. The Politics of Health Care in the United States 65
the Supreme Court. In contrast, the Medicaid expansion continues to spread, as
we discuss below.
Peering in 2018 into the murky future, the nonpartisan Congressional Budget
O!ce predicted a return to rising numbers of uninsured people, given continued
peeling away of the mandate and other aspects of the ACA. What may fairly be
viewed as a moral tragedy—that millions of people in the world’s wealthiest country are unable to pay for health services—will continue for the forseeable future.
THE POLITICS OF PROVIDING EQUITABLE HEALTH SERVICES
Fifty-eight countries around the globe, including nearly all U.S. peer countries
(wealthy democracies), provide universal care—every resident is guaranteed access
to the health care system by their government. Of the world’s 201 nations, 160 provide free health care: no cost to the patient.
“is does not mean that people in di#erent
income classes are all treated equally—it is
possible in some of these 160 countries to
buy private insurance, which can ensure
superior care. But a minimum level of professional care is generally guaranteed to all.
“e United States is among the small handful of countries (most of them lower income, like Liberia, Iraq, and Haiti) that
do not provide free care and do not seek to cover all residents. One result is signi$cant health disparities in the United States: “e quality of health coverage and
care varies widely, depending on where you live and how much wealth you have.
Take a look, for example, at Raleigh, North Carolina. Babies born in the 27617
zip code, generally home to wealthier households, have an average life expectancy of 88 years. Mere miles away, in the 27610 zip code on Raleigh’s southeast
side, babies born today have a life expectancy of 76 years: a shocking 12-year gap.
“at’s the di#erence between Japan (number 1 in life expectancy) and Kyrgyzstan
(number 106), or between Germany (ranked 24) and Iraq (121) (World Health
Organization, 2016).
Health outcomes are worse in almost every respect: Residents of the 27610
zip code have higher rates of obesity, diabetes, and asthma and return to hospitals
within a month of discharge far more often than their neighbors in the 27617 zip
code. “ey miss work for illness far more frequently. And a much higher proportion are uninsured, so when poorer residents seek care at a $rst-rate medical
facility like WakeMed Hospital—if available to them at all—it could break their
bank account (VCU Center on Society & Health, 2018). Figure 3.6, produced by
Virginia Commonwealth University’s Center on Health & Society and the Robert
Wood Johnson Foundation, graphically illustrates this Raleigh disparity in life
expectancy.
Fifty-eight countries around
the globe, including nearly all
U.S. peer countries (wealthy
democracies), provide universal
care—every resident is
guaranteed access to the health
care system by their government.
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66 Part I. Health Policy
Similarly disturbing divergences are evident across the country: from California, where two freeway exits separate neighborhoods with 9 years’ di!erence in
life expectancy, to New York City, where six subway stops also separate a 9-year
gap. “is stark illustration demonstrates what public health researchers have long
known: Health disparities are endemic in the United States (Egen, Beatty, Blackley,
Brown, & Wyko!, 2017). Health outcomes across most groupings of Americans
rise steadily as education improves, income grows, housing is safer, access to good
care exists, and public transportation services are readily available. Once again,
all these topics are indelibly colored by political choices—in America’s federalist system, decisions are variously made at the national, state, and local level, not
infrequently with disagreements and tensions across o#ce holders on each level.
Contributing to political complexity around care for America’s less well-o!,
many rural residents of “red states”—those overwhelmingly voting Republican—
both exhibit relatively poor health outcomes and staunchly oppose government
e!orts to improve their health. Versions of the sign “Keep your government
hands o! my Medicare!” regularly appeared at Tea Party rallies in the wake of
the ACA’s passage (Skinner, 2012)—the irony was noted publicly by President
Obama, among many others (CNN, 2009).
N
DURHAM
DUKE
UNIVERSITY
NORTH CAROLINA
CENTRAL UNIVERSITY
540
RALEIGH-DURHAM
INTL AIRPORT
NORTH CAROLINA
STATE UNIVERSITY
2 miles
Life expectancy at birth (years)
Shorter Longer
RALEIGH
82 YRS
ZIP 27713
85
77 YRS
ZIP 27703
88 YRS
ZIP 27617
81 YRS
ZIP 27606
76 YRS
ZIP 27610
40
40
440
540
Source: VCU’s Center on Health & Society and the Robert Wood Johnson Foundation.
FIGURE 3.6 DIFFERING LIFE EXPECTANCIES BY ZIP CODE: RALEIGH-DURHAM,
NORTH CAROLINA
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Chapter 3. The Politics of Health Care in the United States 67
With little national government e!orts at present to address health disparities, some states and cities are taking action themselves. Virginia in June 2018
became the 33rd state (including the District of Columbia) to expand Medicaid
to a wider set of needy residents, a policy passed as part of the ACA but left up to
individual states. Although conservative governors tended to oppose this extension even though more than 90% of funds came from the national government,
the bene”ts continue to spread (Sommers & Epstein, 2017). Figure 3.7 demonstrates, as of June 2018, which states have opted into this Medicaid expansion—
and which have not. All 18 of the latter had Republican governors and/or large
GOP majorities in their state legislature at the time of this writing.
HOW PERSONAL HEALTH DECISIONS BECOME PUBLIC:
THE CASE OF OBESITY
#e preceding discussions demonstrate that policy decisions, emerging from
political “ghts and compromises, are essential to shaping the distinctive U.S.
health care system. Certainly health providers, market forces, and patients are
also vital contributors—but none of these act absent of political context. And
AZ NM
AK
HI
CA
NV
OR
WA
MT
ID
CO
WY
SD
NE
KS
AR
MO
IA
MN
WI
MI
OH
KY
IL IN
TN
LA
MS AL GA
FL
SC
NC
WA VA
PA
NY
ME
NH
NJ
MD
MA
VT
CT
ND
UT
OK
OK
TX
RI
DE
STATES
NOT
CURRENTLY
EXPANDING
MEDICAID
18
Number of states
that have not yet
expanded Medicaid
STATES
EXPANDING
MEDICAID
TO DATE 33*
Number of states,
including the District
of Columbia, that have
expanded Medicaid
Source: Data from A 50-State Look at Medicaid Expansion FamiliesUSA (2007).
FIGURE 3.7 STATES EXPANDING/NOT EXPANDING MEDICAID: JUNE 2018
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68 Part I. Health Policy
that context itself is the subject of a pitched battle among con!icting American
ideals. On one hand, the U.S. policy is often described as among the world’s most
favorable to individual freedom—prizing personal liberty foremost. On the other,
repeatedly across our national history government actors have charged freely into
private arenas, regulating in the name of public health and safety personal matters like Americans’ drinking habits, sexual practices, or tobacco use (Kersh &
Morone, 2002a; Kersh & Morone, 2002b). Understanding this push–pull between
liberty and government regulation in the name of improved public health is at the
heart of health politics in the United States (Chapter 7 focuses on how health and
behavior in!uence health status in further detail).
Alcohol provides one example of private behavior turned subject of public
health regulatory regimes, helping to illustrate present-day trends. Alcoholic
beverages were long more commonly consumed by Americans than water, given
the dangers inherent in untreated water across the United States’ “rst century.
(#e “revolutionary” “rst widespread disinfection regimen for water was not
introduced until 1881 (McGuire, 2006).) When John Chapman, known as Johnny
Appleseed, planted all those apple trees in the 1840s, their fruit was more often
used to make fermented or “hard” cider than for eating (Kerrigan, 2012). Despite
the ubiquity of cider, beer, rum, and wine on American tables, the United States
underwent “ve major rounds of liquor prohibition between the 1820s and 1919.
#e battle culminating in the 18th Amendment—outlawing the production or
sale of any alcoholic beverages—was merely the most ambitious.
Much closer to the present day, coalitions of national and state political
actors have mounted a sustained challenge to the tobacco industry, resulting in
severe restraints on what many smokers consider their personal choice. As with
alcohol, public o$cials—pressed into action by social movements, advocacy
groups, and medical professionals—moved to regulate a topic that had been
seen as purely private behavior. Note also that in areas like regulating alcohol and tobacco, other advanced democratic nations take a more laissez-faire
attitude.
#e politics of obesity follow this familiar arc: Social stigma regarding overweight people tips into outright discrimination, including in the workplace (Watson, Levit, & Lavack, 2018)—and is further fueled by medical conclusions that
obesity poses a serious threat to personal health. Eventually professional interest
groups come together with concerned public health o$cials, and the policy battle
is joined (Kersh & Morone, 2010).
#ough the politics of health care can feature headlong rushes to judgment
(witness government prohibition of alcohol, or Anthony Comstock’s Victorianera e%orts to o$cially ban literature on birth control) (Morone, 2004), the obesity
case has played out more deliberately, owing especially to the food industry and
its political allies’ organized resistance to change.
Public o$cials’ concern about the growing American obesity rate surfaced
around the year 2000 and was met swiftly with a concerted e%ort to emphasize
personal responsibility, not “nanny state” government actors, in response. #e
idea that overweight and obese people had only themselves to blame—“just say
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Chapter 3. The Politics of Health Care in the United States 69
no, and push back from the table,” in the words of a widely reprinted editorial—
tapped a deep individualistic strain in U.S. politics and, especially at the national
level, sti!ed policymaking designed to address nutrition and diet. No signi”cant
policy addressing obesity passed Congress between 2000 and 2010, though dozens of bills were introduced; indeed, the only related measure that won approval
in either chamber was the “Personal Responsibility in Food Consumption Act
of 2005,” which protected the food industry against lawsuits. It passed the U.S.
House but failed in the Senate (Kersh, 2015; Kersh & Elbel, 2015).
National policy debates also play out in state and local arenas, and here more
substantive achievements have been registered. Prominent policies considered
and, in some locations, enacted include taxes on sugar-sweetened beverages and
junk foods (Pomeranz, Wilde, Huang, Micha, & Moza#arian, 2018); calorie labels
on chain and fast-food restaurant menus (Kiszko, Martinez, Abrams, & Elbel,
2014); government encouragement for “reformulation” of popular snack foods
to reduce sugar, salt, and/or fat content (Buttriss, 2013); and regulating the availability and nutritional quality of “competitive foods” served in schools (Datar &
Nicosia, 2017).
National policy action on obesity since 2010 has focused on calorie menu
labeling, passed as part of the ACA. New York, Philadelphia, Washington’s King
County, and the State of California were among jurisdictions that implemented
a calorie-labeling rule. Even with ample precedent, it took nearly 8 years (and
much lobbying on both sides) before the administrative rulemaking process
“nally yielded a formal labeling rule in May 2018. Meanwhile, U.S. obesity rates
have risen inexorably, topping 37% of adults in 2018. $irty years ago, most
U.S. states reported adult obesity rates of 10% or lower, with none higher than
15%. $e health consequences of obesity are well chronicled (Meldrum, Morris, & Gambone, 2017), but—much as with the U.S. health system as a whole—
the American policymaking system, susceptible at every turn to veto points,
interest group in!uence, and deliberately slowed action, has added layers of
complexity rather than opening a path to better health outcomes or reduced
expense.
CONCLUSION: BETTER NATIONAL HEALTH AHEAD?
We invited readers at the opening of this chapter to imagine whether the result
of extensive politicization of U.S. health systems has led to enhanced patient care
or greater e%ciency. Comparisons to other countries, as well as a look toward the
future—as we write, media alarms are being sounded about Medicare’s impending bankruptcy, a few years hence (Edney, 2018)—would suggest that a rosy view
is hard to apply. Much as with American society more generally, absent a strong
movement for meaningful change, the likely road ahead involves a mixture of
dazzling health care innovations, greater disparities in access to care, kneebuckling expenses, and immense investment of time and energy by political as
well as health professionals—with little concrete improvement to show for it.
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70 Part I. Health Policy
CASE EXERCISE—INSURANCE PLANS
As you sit down to choose your insurance plan for the upcoming year, you have to answer
two questions: (a) what is your BMI (body mass index)? and (b) how many cigarettes do you
smoke a day? The second question is easy for you because you are not a smoker and never
have been. But the !rst one—well, you are overweight. You need to decide how to answer the
question. If you answer truthfully, your insurance rates go up. If you lie, your rates stay the
same, but you run the risk of being caught and paying a !ne.
1. How would you decide which choice to make? What factors would you consider?
2. Is it fair and equitable to be charged more for insurance if you are overweight or
a smoker? What about those who drink or are hypochondriacs—shouldn’t they be
grouped, too?
t
DISCUSSION QUESTIONS
1. How is the U.S. health care system !nanced? How is that di”erent from China and
Great Britain?
2. If the government is not paying to support health care, what is it paying for?
3. What is the role of politics in Medicare and Medicaid?
4. How can average citizens use his or her in#uence on politicians to provide equitable
health services?
5. Why are personal health decisions becoming public?
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4
Comparative Health Systems
Michael K. Gusmano and Victor G. Rodwin
LEARNING OBJECTIVES
▶ Understand the difference between national health insurance (NHI) and
national health service (NHS) systems
▶ Highlight key features and issues in the health systems of Britain, France,
Canada, and China
▶ View the U.S. health system from an international perspective
KEY TERMS
▶ national health insurance (NHI)
▶ national health service (NHS)
TOPICAL OUTLINE
▶ Looking abroad to promote self-examination at home
▶ Health system models
▶ NHS and NHI systems compared with the United States
▶ The health systems in England, Canada, France, and China
▶ Provider payment
▶ Coordination of care
▶ Workforce and information technology (IT)
▶ Health system performance
▶ Lessons
© Springer Publishing Company DOI: 10.1891/9780826172730.0004
Copyright 2019. Springer Publishing Company.
All rights reserved. May not be reproduced in any form without permission from the publisher, except fair uses permitted under U.S. or applicable copyright law.
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AN: 1998657 ; James R. Knickman, PhD, Brian Elbel, PhD, MPH.; Jonas and Kovner’s Health Care Delivery in the United States, 12th Edition
Account: s3563253.main.ehost
74 Part I. Health Policy
INTRODUCTION
Windows can sometimes be mirrors. A look
at health systems abroad can enable us to
develop a better understanding of our health
system in the United States. An international
perspective reveals that the United States
has the most expensive health care system
in the world. Unlike other wealthy countries,
however, the United States fails to provide
universal health insurance coverage. Moreover,
in contrast to most other wealthy nations, our
population faces !agrant inequities in access
to primary and specialty care. Health care
costs are often a source of “nancial strain,
even bankruptcy, for people with serious illness
(Hacker, 2006), and Americans su#er from high rates of mortality that could have
been avoided with timely and appropriate access to a range of e#ective health care
services (Nolte & McKee, 2012). $ere is also evidence that the U.S. health care
system squanders resources and fails to address many of its population’s health care
needs. Not surprisingly, public opinion polls regularly”nd that medical professionals
and the public are dissatis”ed with the system and believe major change is necessary
(Blendon, Benson, & Hero, 2014; Hargreaves et al., 2015).
Looking Abroad to Promote Self-Examination at Home
International comparisons of health care system performance remind us that
there are workable alternatives to our current system. Examining other systems
provides “the gift of perspective” and helps us to understand our own system
“by reference to what it is like or unlike” (Marmor, Freeman, & Okma, 2005). As
Rudolf Klein (1997, p. 1270) explains:
Policy learning … is as much a process of self-examination—of re!ecting on the
characteristics of one’s own country and health care system—as of looking at the
experience of others … the experience of other countries is largely valuable insofar
as it prompts a process of critical introspection by enlarging our sense of what is
possible and adding to our repertoire of possible policy tools. For policy learning is
not about the transfer of ideas or techniques … but about their adaptation to local
circumstances. (emphasis in original)
$is chapter attempts to provide a better understanding of the U.S. health
care system by comparing it to health systems in wealthy countries, which share
many characteristics in common, and by contrasting it to China, a more striking
contrast. Our focus on wealthy nations draws on the experience of member
nations of the Organisation for Economic Co-operation and Development
(OECD), an organization based in Paris that studies economic trends, policies,
Public opinion polls regularly !nd
that medical professionals and
the public are dissatis!ed with
the system and believe major
change is necessary.
Price, volume, and technology
diffusion are the most
important factors driving
health care costs, not an
aging population.*
*To hear the podcast, go to https://bcove.video/2Pe60Tv or access the ebook on Springer Publishing ConnectTM.
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Chapter 4. Comparative Health Systems 75
and health data of its members. We pay special attention to England,1 which
operates a national health service (NHS), and to Canada and France, which have
national health insurance (NHI) systems. Our focus on China is an example of
so-called BRIC nations (Brazil, Russia, India, and China) with large populations
that have bene!ted from rapid economic growth over the past two decades and
now are demanding access to state-of-the-art medical care.
Although England’s NHS is one of the most public systems in the world, it also
allows opportunities for private hospitals, private practice, and private insurance
for those who prefer such options. Canada is frequently compared with the United
States because of its physical proximity and similar political culture; until the mid-
1960s, Canada’s health care !nancing and delivery systems were nearly identical to
those in the United States (Marmor et al., 2005). France’s health system also shares
many features with the U.S. health system. Like the United States, France relies
on a multipayer system for !nancing care and o”ers a mix of public and private
providers for delivering health care services. French citizens also enjoy freedom of
choice among providers—to an even greater extent than Americans. #e French
experience (Rodwin, 2006) suggests that it is possible to achieve universal coverage
without adopting a single-payer NHI system, such as Canada’s, or an NHS, as in
England. China has proclaimed a commitment to universal health care coverage and,
given its size and progress over the past decade, represents an important case study.
Despite its rapidly growing economy, China’s national investments in public health
and medical care are still far smaller than those of OECD nations, and out-of-pocket
payments represent roughly one-third of all health care expenditures. We conclude
the chapter with some lessons of comparative experience for U.S. policy makers.
HEALTH SYSTEM MODELS
NHS systems, such as those in the United Kingdom, Sweden, Norway, Finland,
Denmark, Portugal, Spain, Italy, and Greece, may be traced back to Lord Beveridge,
who wrote the blueprint for the English NHS immediately after World War II.
Although such systems are characterized by a dominant share of !nancing derived
from general revenue taxes, this does not preclude other forms of !nancing. For
example, the relative size of private !nancing and provision is much higher in
Italy and Spain than in Sweden or Denmark. In England, 76% of NHS funding
comes from general taxation, 18% from a payroll tax, and the remainder from
private payments (#omson, Osborn, Squires, & Reed, 2012, p. 33). Historically,
NHI systems have had a more open-ended reimbursement system for health care
providers, but this distinction is blurring as NHI systems are increasingly under
pressure to operate within budget limits.
NHI systems may be traced back to Chancellor Otto von Bismarck, who established the !rst NHI program for salaried industrial workers in Germany in 1883.
With the exception of Canada, whose dominant share of !nancing is from general
1 We focus on England, the largest constituent country within the United Kingdom, because
there are important di!erences among the NHS in Scotland, Wales, and Northern Ireland.
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76 Part I. Health Policy
tax revenues, these systems are characterized by payroll tax-based !nancing. In addition to income taxes, about a quarter of Canada’s federal spending on health care
comes from corporations. “e provinces also supplement income and corporate
taxes with additional sources of funding such as sales, tobacco, and alcohol taxes. As
with NHS systems, NHI systems are characterized by signi!cant variation in their
!nancing and organizational arrangements. For example, the share of French public
health care expenditures !nanced from an income tax on all earnings, including
dividends and interest from capital, increased to 16% in 2016 (Rodwin, 2018).
Whether one’s image of a health system is private and market-based, as in the
United States and Switzerland; public and government-managed, as in the United
Kingdom and Scandinavian nations; or at some intermediary point along such a
continuum, as in France and Canada, it is possible to make some useful distinctions
with respect to the public versus private provision of health care and methods of
!nancing health services. Table 4.1 classi!es health systems along these dimensions.
Provision of Health Services
“e arrangements for providing health care in Table 4.1 distinguish whether health
services are delivered by the public, private not-for-pro!t, or private for-pro!t
sector. Within these categories, many distinctions may be added. For example, some
publicly capitalized organizations (row A) are national (e.g., the Veterans Health
Administration [VHA] in the United States), others are subnational (state mental
hospitals), and many are local (municipal hospitals). Likewise, the not-for-pro!t
category may include a variety of quasi-public organizations, such as hospital
trusts in Britain (row B). “e for-pro!t form of provision (row C) includes private
for-pro!t hospitals and a distinctive subcategory in the United States – hospitals
and managed care organizations (MCOs) that sell ownership shares to investors
on publicly traded stock markets. Indeed, the growth of large investor-owned
MCOs distinguishes the United States from most other OECD nations.
TABLE 4.1 HEALTH SYSTEM PROVISION AND FINANCING

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Chapter 4. Comparative Health Systems 77
Financing
!e four methods of raising revenues to pay for health services correspond to
columns 1 through 4:
■■ 1: General revenue “nancing through the “scal tax system, including personal income
taxes
■■ 2: Compulsory payroll tax “nancing through the Social Security system
■■ 3: Voluntary premiums assessed by private health insurance companies and often paid
by either employees or individuals
■■ 4: Individual out-of-pocket payments made at the time a patient receives a service
Although all countries rely on blends of these four sources of revenue to
“nance health care services, most developed countries have adopted one of two
distinct health system models for actually getting care delivered to patients. NHS
systems generally rely on the government to organize the delivery of services
directly and either employ providers directly or as private contract employees. In NHI systems, governments organize social insurance programs that
reimburse health care providers for services rather than paying for health care
directly through the government’s budget. NHI systems generally rely mostly
on payroll taxes to fund their health services. NHS systems, however, rely on
general revenue taxation such as income taxes and a broad range of other taxes
to fund the delivery system. Using income taxes and general revenues allows for
greater redistribution of resources from the wealthy to the poor. Payroll types
are generally not highly redistributive.
In contrast to England, Canada, and France, China and the United States
rely, to varying degrees, on subnational and local governments to “nance health
care. In Canada, provinces and territories administer universal health insurance
programs, and the federal government provides block grants that account for
approximately 20% of health care expenditures. To qualify for the federal funds,
provincial and territorial health insurance systems must meet “ve criteria speci-
“ed by the Canada Health Act of 1984. !ey must be (a) administered on a nonpro”t basis by a public authority; (b) comprehensive in the sense that they must
cover most health services provided by hospitals, medical practitioners, and dentists; (c) universal in that all legal Canadian residents are covered; (d) portable
so that coverage for all residents in each province or territory is transferable to
all other parts of Canada; and (e) accessible, although “reasonable access” is not
de”ned in the law.
In 2009, China adopted a reform that provided health insurance for all of
its population. Between 2000 and 2013, the share of government total health
expenditure doubled from 15.5% to 30.1% (Qian, 2015). Although China now
provides some minimal health insurance to the majority of its population, coverage remains extremely limited, and as we noted earlier, roughly one-third of
all spending on health care still comes from out-of-pocket payments (Table 4.1,
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78 Part I. Health Policy
column 4). In terms of public funding for health care, China relies—to an even
greater extent than Canada—on subnational government revenues to !nance the
country’s three NHI funds.
Below the national government, China has provincial, regional, and local governments. By the mid-1990s, these subnational government authorities !nanced
80% to 90% of total government spending on social services, including health
care (Hipgrave et al., 2012). “e adoption of health reform has increased central government contributions to health care, but local government taxes and
out-of-pocket payments from individual patients still represent the two largest
sources of revenue. “is approach has exacerbated the large economic disparities between the wealthier coastal provinces and the poorer rural provinces in
western China. “e national government has attempted to address the country’s
rural-urban disparities, but with limited success.
NHS AND NHI SYSTEMS COMPARED WITH THE UNITED STATES
Table 4.1 enables one to highlight key features of NHS and NHI systems and
to adopt an international perspective on the U.S. health care system. “e most
striking di#erence between the United States and NHS or NHI systems is that
the United States—even after passage of the Patient Protection and A#ordable Care Act of 2010 (ACA)—includes large elements of !nancing based on
actuarial principles whereby private insurance premiums (column 3) are set
with respect to estimated risk. In contrast, in NHS and NHI systems, most
health care !nancing is based on ability to pay (columns 1 and 2). Ability-topay criteria lead to wealthier, younger, and healthier individuals paying disproportionately to !nance the care of poorer, older, and sicker individuals. Aside
from this important distinction, the rows and columns of Table 4.1 suggest that
most health care systems have elements of many boxes ranging from socialized medicine (box A1) to out-of-pocket payment for private practitioners and
hospitals (box C4).
“e United States has neither an NHS nor an NHI system. Instead, the
U.S. health care system relies on a patchwork of public and private insurance
with large gaps in coverage (see Chapter 3). Its enormous pluralism exhibits
components of its health system within each of the boxes in Table 4.1. It uses
a social insurance system for older people and for those with permanent disabilities (Medicare: columns 1 and 2); a social welfare system for some people
with low incomes (Medicaid, column 2); and an employer-based private health
insurance system for a large percentage of salaried employees in the private
and public sectors (column 3). Along with its public and private insurance programs, the United States also has elements of socialized medicine, such as the
military health care system, the VHA system, and the Indian Health Service
(IHS) for Native American and Alaskan Native people.
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Chapter 4. Comparative Health Systems 79
THE HEALTH SYSTEMS IN ENGLAND, CANADA, FRANCE, AND CHINA
Beyond the di!erences we have noted
between NHI and NHS systems, these systems have evolved in similar directions.
After World War II, governments have gradually extended their role in the “nancing
and provision of health services. What was
once largely the responsibility of the family,
philanthropy, religious institutions, employers, and local governments has largely
been taken over by national and subnational governments—a trend that has
accompanied the rise of the welfare state (de Kervasdoué, Kimberly, & Rodwin,
1984). #is evolution has a!ected all wealthy OECD nations and, increasingly,
BRIC and less developed nations. #e U.S. reliance on employer-based private
health insurance for many Americans is an important contrast to NHI and NHS
systems. Yet even in the United States, recent decades have seen an expansion of
public insurance and a decline in employer-based coverage.
#e growth of government involvement in health systems has characterized
OECD nations during the great boom years of health sector growth (1950s and
1960s) when governments encouraged hospital construction and modernization,
workforce training, and biomedical research. It continued in the 1970s, when the
goals of OECD countries shifted more in the direction of rationalization and cost
containment (Rodwin, 1984). In the early 21st century, public and private health
insurance has become the dominant source for funding health care, and public
expenditure on health care services, along with education and Social Security,
has become one of the largest categories of social expenditures as a share of gross
domestic product (GDP).
In contrast to these trends in OECD nations, by the end of the 1970s, China
moved from a health system dominated by public “nancing to one dominated by
private, out-of-pocket payments. Between 1949 and the early 1980s, the Chinese
health system was “nanced largely by the central government and state-owned
enterprises (Valentine, 2005). In 1978, Deng Xiaoping called for market reforms.
#e central government reduced its share of national health care spending from
32% to 15% (Blumenthal & Hsiao, 2005). It slashed subsidies to public hospitals
and introduced market mechanisms in health care, resulting in rapid growth of
out-of-pocket payments and income-based inequities.
By the late 1990s, Chinese o$cials increased investment in public health to
address growing disparities between rural and urban areas. E!orts to improve
the public health and primary care systems accelerated after the outbreak of
severe acute respiratory syndrome (SARS) in late 2002. By the end of 2003, more
than 5,000 people were infected with SARS and 349 people died (Smith, 2006),
thus exposing the weaknesses of the public health system. Since 2009, China has
continued to expand the role of government through the creation of new public
After World War II, governments
have gradually extended
their role in the !nancing and
provision of health services.
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80 Part I. Health Policy
insurance schemes and the adoption of new public health regulations (Wang,
Gusmano, & Cao, 2011).
In addition to the growth of government’s role in health care, most OECD
nations confront common challenges and exhibit distinct approaches for many
issues. We illustrate how this is so by comparing the health systems of England,
Canada, France, and China with respect to (a) provider payment, (b) coordination
of care, (c) workforce and IT, and most important, (d) health system performance.
Provider Payment
All countries rely on multiple methods for paying physicians and hospitals.
NHS systems traditionally have relied more on salaried and capitation forms of
payment for physicians and budgets for hospitals. In the English system, about
two-thirds of general practitioners (GPs) and dentists work as independent contractors reimbursed through a blended payment system, 75% from capitation
payment and most of the rest (20%) from fee-for-service (FFS) payments based on
performance. Since 2012, GPs have been placed in charge of clinical commissioning groups (CCGs), which control about 70% of the NHS budget (NHS Clinical
Commissioners, 2018). CCGs are locally speci!c NHS bodies in charge of planning and commissioning health care for their area, including purchasing hospital
and specialty medical care services for their patients. “e NHS !rst introduced
a prospective payment system for reimbursing public and private hospitals in
2003 and, in April 2004, phased in a new national tari# system. Since 2012, the
NHS has adopted a Payment by Results (PbR) system based on the average cost of
providing the procedure or the treatment across the NHS as a whole.
Historically, Canadian primary care physicians have been paid on an FFS
basis. “e Ministries of Health for all provinces and territories are responsible for
negotiating an annual physician fee schedule based on a relative value scale (RVS)
for each reimbursable procedure or code. “e RVS may have developed from a
resource-based fee schedule (RBFS), which tries to capture the inputs required
to provide the service, or on historical charges. Studies have found wide variation in fee schedules across Canada (Roth & Adams, 2009). In more recent years,
some provinces have experimented with blended capitation schemes in family
health networks, family health teams, and family health organizations. Blended
capitation relies on age- and gender-adjusted payments, coupled with !nancial
incentives to follow “evidence-based” guidelines and FFS when physicians treat
patients who are not enrolled in these schemes (HealthForceOntario, 2014).
In France, physicians in the ambulatory sector and in private hospitals are
reimbursed largely on the basis of a fee schedule negotiated among physician
associations, the central administration of NHI funds, and the government.
Approximately 10% of GPs and 40% of specialists in private o$ce-based practice
have the option to extra-bill beyond the negotiated fees that represent payment
in full for all other physicians. “ese !gures vary by subspecialty and location.
Physicians who have opted to extra-bill may do so as long as their charges are
set with “tact and measure,” a standard that has never been legally de!ned but
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Chapter 4. Comparative Health Systems 81
which has been found, empirically, to represent a 50% to 100% increase to the
negotiated fees. Physicians who “extra-bill” receive more revenue per patient seen
but they need to recruit from a subset of patients able and willing to pay this extra
out-of-pocket payment. Physicians based in public hospitals are remunerated on
a part-time or full-time salaried basis, and those in private for-pro!t hospitals
may bill NHI based on the negotiated fees.
Before 1984, public hospitals in France were reimbursed on the basis of a retrospective, cost-based, per diem fee; after that, they were placed on global budgets
that were later gradually adjusted for patient case mix in the 1990s. Private forpro!t hospitals used to be reimbursed on the basis of a negotiated per diem fee;
in the 1990s, the per diem payments were also gradually adjusted for their case
mix. “e basis for case-based adjustment in France is an adaptation of the U.S.
diagnosis-related group (DRG) categories known in France as GHM (groupes
homogènes de malades). “e most recent modi!cation was introduced in 2004
(Schreyögg, Stargardt, Tiemann, & Busse, 2006) when activity-based payment
(ABP) was introduced to create a level playing !eld for reimbursement of acutecare services among public and private hospitals. As of 2012, the reimbursement
system for public and private hospitals has been completely aligned based on
the national ABP tari#s that take into account each hospital’s historical costs.
“is has resulted in expected activity growth, which in turn, results in downward
price adjustments because annual hospital costs are constrained by national and
regional hospital expenditure targets (Or, 2010).
In China, the expansion of health insurance is changing the nature of provider
payment, but by the end of 2013 most physicians were still paid salaries. Subnational
governments in China regulate prices in an e#ort to make health care a#ordable, and
over the past two decades, with encouragement from the central government, they
have introduced such incentives as pay-forperformance based on treatment protocols to
improve quality (Yip, Hsiao, Meng, Chen, &
Sun, 2010). Although the central government
hopes the expansion of health insurance will
limit hospital reliance on kickback payments
from medical device and pharmaceutical
companies, such payments continue to be
an important source of revenue for Chinese
health care providers (Wang et al., 2011; Shi
et al., 2018).
In comparison to England, Canada, France, and China, the United States pays
signi!cantly higher prices for medical care. Although there is some debate about
the factors that drive U.S. health care spending, consensus has emerged that price
is the most important factor in explaining why the United States spends so much
more than any other health care system in the world (Papanicolas, Woskie, & Jha,
2018). Two distinguishing characteristics of the U.S. health care system are that, in
contrast to other OECD countries, there is neither a national budget cap nor a formal
process of price negotiation between payers and representatives of physicians.
Two distinguishing
characteristics of the U.S. health
care system are that, in contrast
to other OECD countries, there
is neither a national budget cap
nor a formal process of price
negotiation between payers and
representatives of physicians.
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82 Part I. Health Policy
Coordination of Care
All countries su!er from problems of coordination among hospitals and
community-based services. “ey di!er, nonetheless, with regard to the resources
and organization of their delivery systems. France, for example, has more practicing
doctors per 1,000 population (3.3) than the United Kingdom (2.8), the United States
(2.6), Canada (2.7), or China (1.8) (OECD, 2015). France also has more acute hospital
beds per 1,000 population (4.1) than the United States (2.5), the United Kingdom
(3.0, 2013), Canada (2.0), or China (2.7, 2013) (OECD, 2013, 2015).
Since its creation in 1948, the NHS has been one of the largest public service
organizations in Europe. With more than 1 million employees, more than 2,500
hospitals, and a host of intermediary health care organizations, the NHS poses an
awesome managerial challenge (Klein, 2013, 2018). Perhaps because Britain has
fewer health care resources than most OECD nations, the British have been more
aggressive in e!orts to reduce ine#ciency than other wealthier countries. Because the
NHS faces the same demands as other systems to make technology available and to
care for an increasingly aged population, British policy makers recognize they must
pursue innovations that improve e#ciency in the allocation of limited resources.
Such e!orts, however, face numerous obstacles: opposition by professional bodies,
di#culties in %ring and redeploying health care personnel, and, not least, the
tripartite structure of the NHS, which, since its inception, has created an institutional
separation among hospitals, general practitioners, and community health programs.
“is separation is reinforced further by the fact that local authorities are responsible
for a great deal of prevention and health promotion as well as social care, making it
di#cult to integrate hospital and community-based care.
In Canada, less separation exists between physicians and hospitals because
specialists are paid FFS and work both in community-based practice as well as in
hospitals. Hospitals are largely private nonpro%t institutions with their own governing boards, but they are almost entirely publicly %nanced and subject to tight
budget constraints. Most community-based physicians must refer their patients
requiring diagnostic procedures and testing, as well as more specialized care, to
local hospitals, which can lead to extended waiting times for elective procedures
and problems in ensuring optimal coordination among hospital specialists and
community-based providers.
France also faces problems with the coordination of care between hospitals
and community-based providers. “ere is inadequate communication between
full-time, salaried physicians in public hospitals and solo physicians working in
private practice. Although GPs have informal referral networks to specialists and
public hospitals, no formal institutional relationships exist to ensure continuity of
medical care; disease prevention; health promotion services; posthospital followup care; or systematic linkages and referral patterns among primary-, secondary-,
and tertiary-level services. Schoen et al. (2012) document that the French health
care system is characterized by poor hospital discharge planning and a lack of
coordination among medical providers.
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Chapter 4. Comparative Health Systems 83
In China, before 1978 the health care delivery system in rural areas was organized by communes, which provided housing, education, and social services as
well as basic medical care. An important feature of the communes’ Cooperative
Medical System was the sta! of paraprofessionals known as “barefoot doctors”
(Rosenthal & Greiner, 1982). Most of the barefoot doctors were young peasants
who received a few months of training and o!ered basic primary and preventive
care, including health education. If the needs of patients were more complex, the
barefoot doctors would refer them to physicians at the commune health centers
or, if necessary, to the closest hospital. In urban areas, the health care delivery
system relied heavily on so-called “rst-level hospitals, community clinics with a
modest inpatient capacity, to provide ambulatory care.
With the introduction of market mechanisms in the health sector after 1978,
the government ended its barefoot doctor program in rural areas, leaving the
population in rural China without adequate access to health care services. It also
reduced its subsidies to state-owned “rst-level hospitals; forced to become more
self-reliant, these hospitals withdrew public health and primary health care services. Some “rst-level hospitals went bankrupt, and those that survived turned to
pro”table medical services rather than emphasizing primary care and prevention.
Since the 2009 reform, the rapid increase in health insurance coverage brought
nearly 1 billion people back under some form of “nancial protection. Service
utilization has increased and hospital care has become more a!ordable, but there
are still glaring disparities across regions and medical sectors (He & Meng, 2015).
Moreover, a strong system of primary care is conspicuously absent, and coordination among primary care and hospitals remains an elusive goal.
Workforce and Information Technology
Primary care versus specialty care balance. Among OECD health care systems,
an average of 31% of physicians are generalists. #e United States stands out, in
contrast, because about 90% of physicians are specialists, and only about 10%
are generalists (Laugesen, 2018). Despite this di!erence, when adjustments are
made, it turns out that one third of the physician workforce in the United States
and other OECD nations works in primary care. #e situation in China, however,
presents a striking contrast because only 57% of cities have community-based
primary care organization, and more than 40% of the population reports that it
does not have convenient access to a primary care center (Wang et al., 2011). In
addition, most general practitioners lack additional training after receiving their
undergraduate medical education.
Primary care is important because systems with a higher concentration of
primary care practitioners improve coordination and continuity of care. Access
to an e!ective system of primary care appears to result in higher life expectancy
at birth, lower infant mortality, lower mortality from all causes, lower diseasespeci”c mortality, and higher self-reported health status (Star”eld, Shi, &
Macinko, 2005; World Health Organization [WHO], 2008).
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84 Part I. Health Policy
Workforce shortages/surpluses. Concerns about the adequacy of primary
care in the United States are reinforced by discussions about the adequacy of the
health and social care workforce in the face of rapid population aging (Carrier,
Yee, & Stark, 2011). Increases in Alzheimer’s disease and other forms of dementia
have raised concerns about the extent to which the health and long-term care
systems will have a su!cient number of physicians, nurses, and other medical
professionals to address the needs of an aging society (Warshaw & Bragg, 2014).
Although a shortage of clinicians, particularly in primary care, is the major
concern in the United States, France, and China, some countries in Europe, particularly England, now wonder whether they may have too many doctors and
nurses. Before the global economic crisis began in 2008, many OECD countries
adopted policies designed to increase their supply of medical professionals.
After the economic slowdown, many countries expressed concern about an
“oversupply” of some health care workers (Ono, Lafortune, & Schoenstein, 2013).
Starting in 2000, for example, the English NHS adopted a workforce redesign
initiative to increase the number of doctors and nurses in the system, expand
the roles of existing professionals, and redistribute responsibilities to rely more
on teams of health care professionals. As a result, there is now concern that the
country may have too many hospital specialists, but there are persistent concerns
that it still does not have a large enough supply of well-trained social care workers, particularly for providing home care to older patients (Bohmer & Imison,
2013). Similarly, a recent assessment of health care needs in Ontario, Canada,
concluded that there will be an aggregate surplus of GPs and specialists in 20
years, even though some specialties and areas may experience shortages (Moat,
Waddell, & Lavis, 2016).
!e push for electronic medical records and other forms of health care IT.
“roughout the world, policy makers are searching for ways to reduce health
care spending while improving the quality of care. “e use of electronic health
records and other forms of health information technology (HIT) are often touted
as solutions to these problems (see Chapter 14). Harvey Fineberg (2012), the
president of the Institute of Medicine, argues that over the long term, HIT will
improve the quality and e!ciency of the health care system. Marmor and Oberlander (2012, p. 1217) dismiss the focus on HIT as a “fad” and suggest that the
desire to #nd a “big #x” to the problems of cost and quality has led policy makers
to embrace technical and managerial solutions, including the adoption of HIT,
along with various forms of managed care, health planning, and payment reforms
designed to align the incentives of providers and patients with public health goals.
“is argument supports the classic James Morone (1993) thesis that the
United States tends to search for a “painless prescription” to the major challenges
in health care. Indeed, comparative analysis suggests that such technical solutions as HIT to the problems of cost and quality have had little e$ect on cost or
quality in health care and that the United States should focus on more important
structural features of other health care systems, such as global budgets, fee schedules, systemwide payment rules, and concentrated purchasing power.
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Chapter 4. Comparative Health Systems 85
Advocates of HIT argue that newer developments in the use of so-called big
data are more likely to transform medical practice because of their capacity to
link information among many institutions within a health care system. !ey also
argue that the United States has never adopted HIT on a widespread basis, so
the failure of previous e”orts to improve quality or lower costs is not su#cient
evidence that HIT cannot contribute to these goals in the future.
It seems plausible to suggest that HIT may be a valuable tool for addressing
costs and quality in health care, but its value surely depends on the policy context
in which it is used. For England, Canada, and France, HIT may further enhance
the e#ciency of resource allocation by providing administrators, providers, and
patients with access to better information. In the United States, however, the
e”ect of HIT within the context of a fragmented, open-ended $nancing system
may be far more limited. Viewed from this perspective, it is easier to understand
the arguments of those who remain skeptical of HIT’s importance.
Health System Performance
Policy makers and researchers often want to compare the performance of di”erent systems and identify lessons for health policy. Although these e”orts have
generated important information, they have often succumbed to the temptation
of devising a composite indicator to rank health care systems against one another
(Oliver, 2012). !is practice encourages lavish attention from the media on the
search for the best health care system, the new holy grail of performance assessments. Unfortunately, such an approach lacks any e”ort to understand, assess,
and compare health care systems in relation to the cultural context, values, and
institutions within which performance indicators are embedded.
!e study of health system performance by the WHO is the most prominent example of the composite indicator approach to the comparative analysis of
health systems (WHO, 2000). WHO ranked the health systems of 191 member
states based on weighted measures of $ve objectives: (a) maximizing population
health (as calculated by disability-adjusted life expectancy, or DALE); (b) reducing inequalities in population health; (c) maximizing health system responsiveness; (d) reducing inequalities in responsiveness; and (e) $nancing health care
equitably.
Although controversial because of its many methodological %aws and missing data, the WHO report generated tremendous discussion about health system
performance and the criteria that should be used to assess it (Musgrove, 2003).
Some of the controversy generated by the report can be attributed to complaints
from countries unhappy with their ranking, but prominent academics also criticized the study for relying on incomplete and inadequate data as well as on questionable methods (Williams, 2001).
WHO’s use of DALE as a measure of health status illustrates the problem of
using population health status to assess the performance of health care systems.
DALE includes causes of death that are amenable to health care as well as a
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86 Part I. Health Policy
host of social determinants of health. As a result, this measure is not “related
directly to the health care system” (Nolte & McKee, 2003, p. 1129). Using DALE,
life expectancy at birth and infant mortality are inadequate measures of health
system performance because the role of health care in improving population
health is small compared with interventions aimed at social and environmental
determinants.
As Bradley and Taylor (2013) argue, one reason the United States performs so
poorly on such indicators is because we have failed to invest su!ciently in education, housing, employment, and other social programs that help to produce and
sustain good health. Between those who emphasize the decisive e”ect of social
determinants of health and those who focus on access to health care, there is a
middle ground: attention not only to the consequences of poor social conditions,
but also to barriers in access to what we have called e”ective health care services.
#ere is a vast literature that measures inequities in access to health care (see
Chapter 2). Such studies rely either on comparisons of inputs (e.g., physicians,
hospital beds) or on administrative or self-reported survey data to measure service utilization. An alternative approach attempts to capture the consequences
of poor access to disease prevention, primary care, and specialty services—in
other words, mortality amenable to health care (amenable mortality). Of course,
few causes of death are entirely amenable, or not amenable to health care, and
as medical therapies improve even more deaths may be classi$ed as potentially
avoidable. Nevertheless, based on an OECD study, this summary provides convincing evidence that the United States is not performing well in comparison to
other wealthy nations (Mossialos, Wenzl, Obsorn, & Sarnak, 2016).
Cross-national analysis of trends in avoidable mortality indicates that
amenable deaths have declined much faster over the last three decades than
other causes of death (Nolte & McKee, 2012). #is result lends further credence
to the validity of amenable mortality as an indicator of the e”ectiveness of public
health interventions and medical care. We have used this measure to compare
the health systems in megacities located within four of the countries we highlight
in this chapter: London, New York, Paris, and Shanghai (Gusmano, Weisz, &
Rodwin, 2009).
#rough ACOs in the United States (see Chapter 11) and various forms of
disease management and integrated service delivery proposals in other countries,
health care professionals are being encouraged to think about population as well
as individual health. #e e”ort to shift health systems in this direction is a positive development, but if we hope to understand the performance of health care
systems and the relationship between health care inputs and health outputs, it is
important to select such indicators as amenable mortality, which are more closely
related to the performance of these systems than are broad measures of health
such as life expectancy and DALEs.
#e extensive criticism of WHO’s e”ort to evaluate health system performance has not discouraged other groups from taking similar approaches. #e
Commonwealth Fund has a project designed to identify high-performing health
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Chapter 4. Comparative Health Systems 87
systems within the United States and other wealthy nations. It also draws on
more dependable data than WHO’s for its assessments in part because its scope
is more limited and focuses on nations for which population, health, and health
system data are more readily available. For example, the Commonwealth Fund
supplements many of the same data sources used by WHO with original surveys
of patients and primary care providers !elded by Harris Interactive (Commonwealth Fund, 2014).
It then uses these survey results, along with a host of other data sources, to
compare U.S. national averages on multiple criteria grouped by such categories
as health outcomes, quality, access, e”ciency, and equity (Schneider, Sarnak,
Squires, Shah, & Doty, n.d.). #e problem with such an approach, well summarized by Schneider and Squires (2017), is that little attention is paid to the validity
of the multiple criteria measured and no rationale is provided for weighting the
main categories equally and then ranking health systems on the basis of criteria
on which diverse publics and policy makers rarely agree.
Access to services across income groups. An important dimension of health
system performance is the extent to which a system provides access to health
care services by income group. In contrast to the United States, countries with
universal or near-universal coverage enjoy a relatively equitable distribution of
primary care visits (van Doorslaer & Masseria, 2004). Lower-income residents
of Australia, Canada, New Zealand, and the United Kingdom, for example,
are less likely to report barriers to health care than people with below-median
incomes in the United States (Blendon et al., 2002). A comparative study on
hospitalizations for ambulatory care sensitive conditions (ACSCs), a measure
of access to timely and e$ective primary care, !nds that rates are much lower in
England, France, and Germany than in the United States (Gusmano, Rodwin, &
Weisz, 2014).
A concern often voiced by conservative analysts in the United States is that
so-called “government-run” health care systems, by which they mean both NHS
and NHI systems, “ration” care (Goodman, Musgrave, & Herrick, 2004). Because
such systems operate within a budget, these analysts claim, they must limit access
to specialty and surgical health care services in ways that are unacceptable. #is
claim is supported by studies that compare access to certain expensive health
care services in England and the United States (Aaron, Schwartz, & Cox, 2005).
Although there is evidence that some expensive technologies, including revascularization and kidney dialysis, are used less frequently in England than in the
United States (Gusmano & Allin, 2011), this is not the case with respect to France
or Germany. For example, after controlling for need, the use of revascularization
(coronary artery bypass and angioplasty) is comparable in France, Germany, and
the United States (Gusmano et al., 2014).
Even among countries that provide universal coverage, there are di$erences
in access to specialty services by socioeconomic status. Residents of higherincome neighborhoods in Winnipeg, Canada, a country that strives to eliminate
!nancial barriers to care, receive “substantially more” specialty and surgical care
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88 Part I. Health Policy
than lower-income residents of the city (Roos & Mustard, 1997). In France, Germany, and England, access to some specialty health care services is signi!cantly
worse among residents of lower-income neighborhoods (Gusmano et al., 2009).
Inequalities in access to health care are even greater in BRIC countries and developing nations. Despite remarkable economic growth in recent decades, for example, there are “agrant disparities in access to health care within China.
Cost. As was evident during the debates over the ACA, there is a widely shared
belief among American policy makers that a national program providing for universal entitlement to health care in the United States would result in runaway
costs. In response to this presumption, nations that entitle all of their residents to
a high level of medical care, while spending less on administration and on health
care than the United States, are often held up as models. #e Canadian health system is the most celebrated example. French NHI is another case in point. England’s
NHS, although typically considered a “painful prescription” for the United States
(Aaron et al., 2005), nevertheless ensures !rst-dollar coverage for basic health services to its entire population and, as we have seen, spends less than half as much
on health care, as a percentage of GDP, and approximately one-half as much per
capita as in the United States (Table 4.2). Huang (2011) expects that China’s total
health care expenditures will increase rapidly over the coming decade, but its current spending, as a percentage of GDP, is far below the OECD average.
Stories in the media often suggest that pressures from population aging will
render existing welfare state commitments, including the Medicare and Medicaid programs in the United States, unsustainable. Despite these concerns, most
studies conclude there is no correlation between the percentage of the older
population (65 years and over) and health care expenditures as a percentage of
GDP. #e United States, which spends more on health care than any country in
the world, is among the OECD countries with the youngest age cohorts. In contrast, Britain, Italy, Sweden, Germany, and France, with older populations than
the United States, spend a far lower percentage of GDP on health care. Even if
one excludes the United States and examines only the European Union, there is
no correlation between population aging and health care spending.
Cross-national analysis of health care expenditure data indicates that, after
controlling for income, age has little e$ect on national health care expenditures.
TABLE 4.2 HEALTH CARE EXPENDITURE AS A SHARE OF GDP: SELECTED COUNTRIES, 2016

* Data only available up to 2014.
GDP, gross domestic product; OECD, Organisation for Economic Co-operation and
Development.
Source: Organisation for Economic Co-operation and Development. (2017). Health at a
glance 2017: OECD indicators. Paris, France: OECD Publishing.
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Chapter 4. Comparative Health Systems 89
Proximity to death, not age, leads to an increase in health spending (Moon, 1996).
An analysis of health spending on older people in Switzerland found that expenditures are concentrated in the last few months of life (Zweifel, Felder, & Meiers,
1999). Although the OECD analysts project that “age-related spending for the
average country will rise by around 6 to 7 percentage points of GDP between
2000 and 2050,” they acknowledge that “part of this pressure is a result of cost
pressures from advances in medical technologies, rather than ageing per se”
(Australian Department of the Treasury, 2007).
Price, volume, and technology di!usion are the most important factors that
drive health care costs; as noted earlier, however, high U.S. prices explain why
the U.S. health care system is so expensive relative to other nations (Papanicolas
et al., 2018). Although Americans spend more than any other nation, health service use in the United States is actually below the median for the OECD on most
measures. A study for the McKinsey Global Institute (Angrisano, Farrell, Kocher,
Laboissiere, & Parker, 2007), based on four diseases, provides further support
for the role of prices in driving up U.S. health care costs. “e study found that in
1990, Americans spent about 66% more per capita on health care than Germans
but received 15% fewer real health care resources.
In addition to understanding the factors that drive health care spending, it
is important to confront the question: How much spending on health care is too
much? Most health economists argue that there is no right amount of money to
spend on health care. Cutler (2007) argues that we should focus less on the level
of health care expenditure and pay greater attention to whether the expenditures
generate more bene#ts than costs. However, e!orts to adopt explicit economic
evaluation of health technology provoked controversy in the United States.
“e ACA forbids federal government agencies from using cost as a criterion
for making coverage decisions. Among the countries compared in this chapter,
France, Canada, and England, to varying degrees, all use economic evaluations of
health technology to make coverage decisions. In France, economic evaluations
of new drugs are recommended but not required (Sorenson, 2009). In Canada,
these e!orts are more decentralized than in England, and “only a handful” of technologies are subject to cost-e!ectiveness analysis (Menon & Sta#nski, 2009). In
England, the National Institute for Health and Care Excellence (NICE) focuses on
new technologies only and is reputed to be the leading health technology assessment agency worldwide.
NICE, established in 1999 in response to growing concerns about variations
in the use of new technology, is supposed to meet three primary objectives:
(a) reduce unwarranted variation in prescribing patterns across England and
Wales, principally through setting practice guidelines; (b) encourage the di!usion and uptake of e!ective health technologies; and (c) ensure value for money
for NHS investment by assessing the cost-e!ectiveness of selected interventions. Record increases in NHS expenditures throughout the decade following
2000 were linked to meeting these objectives, particularly in terms of directing
spending to facilitate widespread and uniform access to the most cost-e!ective
treatments.
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90 Part I. Health Policy
NICE prides itself on its transparency, methodological rigor, stakeholder
inclusiveness, consistency, independence from government, and timeliness, all of
which appear necessary to secure the legitimacy and e!ectiveness of its recommendations. Since 2003, it has been mandatory for local NHS purchasers and
providers to act on all positive recommendations on technology appraisals (i.e.,
recommendations that speci”c health care interventions be made available in the
NHS) within 3 months of their publication.
NICE arrives at conclusions about whether interventions are therapeutically bene”cial and cost-e!ective compared with other relevant alternatives by
reviewing a range of available evidence, assembled and synthesized by a publicly
funded network of academic institutions. #e role of social values in the appraisal
process is increasingly apparent as NICE reviews complex cases, for instance,
on whether select end-of-life cancer drugs be made available to NHS patients
despite their o!ering insu$cient value for money with respect to conventionally
accepted thresholds of cost-e!ectiveness.
#ere is some evidence that widespread adoption of NICE recommendations
for speci”c technologies, particularly cancer drugs and the use of varenicline for
smoking cessation, has reduced geographic variations in access to the technologies (Chalkidou, 2009). Also, there is evidence that NICE guidance has increased
costs to the NHS, which is not surprising because most cost-e!ective interventions are more expensive than the alternatives. #is does not bode well for those
in the United States who hope that economic evaluation of health technology will
contain the growth of health care costs, particularly if assessment e!orts are disproportionately focused on new, expensive technologies. Chalkidou (2009) estimates that since its creation, NICE’s decisions have cost more than £1.5 billion a
year. In this context, it should be noted that cost containment was never one of
NICE’s explicit objectives.
Quality. #e focus on quality is a relatively recent phenomenon. For many
years, the primary concern of most policy makers, particularly in developed countries, was on overcoming “nancial barriers to the health care system. In 2002, the
OECD created the Health Care Quality Indicators (HCQI) project to develop
and implement a set of international indicators. #e project includes representatives from 23 of the 30 OECD nations, as well as a number of international
partners, including the Commonwealth Fund, the Nordic Council of Ministers
Quality Project, and the International Society for Quality in Health Care (ISQua).
#e project team identi”ed “ve priority areas for monitoring quality: (a) cardiac
care, (b) diabetes mellitus, (c) mental health, (d) patient safety, and (e) primary
care and prevention/health promotion. #e OECD secretariat asked participating countries to identify expert panelists to review potential indicators (Mattke,
Epstein, & Leatherman, 2006). #e panels were charged with reviewing existing
indicators rather than developing entirely new measures. #ey used a consensus
process and selected 86 indicators on the basis of relevance, including the extent
to which the health system can in%uence the indicator, scienti”c soundness,
and feasibility. Not surprisingly, the project has identi”ed signi”cant variation
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Chapter 4. Comparative Health Systems 91
in quality as measured by these indicators
(OECD, 2013).
Some quality indicators, such as leaving a foreign body inside patients during
surgery, follow directly from the literature
on medical errors that can be influenced
by a health system. The relationships
between health system quality and other
indicators, however, are controversial. For
example, higher rates of 5-year survival
among patients diagnosed with breast or
cervical cancer may reflect better access to high-quality cancer care. It is possible, however, that these outcomes may reflect more aggressive efforts to
diagnose patients with cancer and have little to do with the quality of care
patients receive. Beyond these conceptual issues, countries continue to struggle with a lack of relevant data for quality monitoring. Even in countries with
relatively well developed health data systems, it is often difficult to link data
with unique patient identifiers in ways that allow researchers and policy
makers to understand quality of care across different episodes of care and
different providers.
In 2010, the United Kingdom’s coalition government published a white paper,
Equity and Excellence: Liberating the NHS, which called for the measurement of
health outcomes based on a number of speci!c indicators. To achieve this goal,
England developed the NHS Outcomes Framework (Secretary of State for Health,
2014) with indicators to evaluate local health care arrangements across !ve different domains: (a) preventing people from dying prematurely; (b) enhancing the
quality of life for people with long-term conditions; (c) helping people to recover
from episodes of ill health or after injury; (d) ensuring that people have a positive
experience of care; and (e) treating and caring for people in a safe environment
and protecting them from avoidable harm.
In France, the Haute Autorité de Santé (HAS), or National Authority for
Health, was established in 2004 as an independent public organization to promote quality of health services through accreditation, certi!cation, and development of practice guidelines. Today, HAS leads the European Network for Patient
Safety (EUNetPaS), which has developed a common agenda to promote patient
safety. After a contaminated blood scandal in the early 1990s, the French government established new institutions to conduct disease surveillance and protect
the population from unsafe foods, unsafe drugs, and unsafe blood. In addition,
France’s Ministry of Health recently initiated a small number of aggressive safety
campaigns with strong patient involvement, such as one supported by TV spots to
improve the use of antibiotics in preventing the appearance of resistant bacteria.
Based on a risk-scoring system for surgical wound infections, national prevalence
rates of methicillin-resistant Staphylococcus aureus (MRSA) in France declined
from 2001 (33%) to 2006 (27%). “ese results are impressive in comparison with
Even in countries with relatively
well developed health data
systems, it is often dif!cult to
link data with unique patient
identi!ers in ways that allow
researchers and policy makers
to understand quality of care
across different episodes of care
and different providers.
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92 Part I. Health Policy
other European countries and the United States, where MRSA infections have
increased (Degos & Rodwin, 2011).
In 1994, the Canadian government established the Canadian Institute for
Health Information (CIHI) to improve its capacity to assess the health care
system and to identify standards for health system performance. CIHI maintains 27 databases and clinical registries. !e agency receives funding from
the federal (80%) and provincial (20%) governments (Marchildon, 2013). In
2004, the federal government adopted a 10-year plan to strengthen health care.
!e plan increased federal health transfers to the provinces by 6%, and the
provinces were supposed to place greater emphasis on reducing wait times
and improving quality (Allin, 2012). Some of these funds have been used to
track and reduce wait times. !e federal government has also encouraged the
use of health technology assessment, clinical guidelines, and best practices
to enhance patient safety. Critics argue that despite the increase in attention
to quality in individual provinces, problems of access, variation, and reform
remain formidable (Lewis, 2015). Moreover, Canada lacks a “guiding framework
that supports” quality improvement in primary care (Sibbald, McPherson, &
Kothari, 2013, p. 2).
In China, the issue of quality is also central to recent policy debates, but
their starting point is radically di”erent. When the Chinese government
reduced its subsidies for health care in the late 1970s, health care organizations
and providers often turned to pharmaceutical companies to make up for these
lost revenues. Rather than focus on providing primary and preventive care, for
example, many #rst-level hospitals focused on selling drugs to patients (Wang
et al., 2011). As a result, these institutions developed a reputation for poor quality, and patients were drawn to larger hospitals and academic medical centers,
creating overcrowding problems. Part of the motivation for expanding health
insurance in China was to improve the quality of care across the entire health
care system, but this goal remains as elusive as the challenge of coordination
(Wang et al., 2011).
Criteria used to evaluate the performance of health care systems—such as
access to, cost of, and quality of health care—are often called the “three-legged
stool” of health policy. Until recently, however, quality did not receive a great deal
of attention. Since the 1970s, researchers, policy makers, and patients have been
demanding better information about quality. In the late 1990s, the U.S. Institute
of Medicine led the world in calling attention to the importance of this issue,
based on a report that uncovered disturbing evidence of problems with safety and
quality in the United States (Kohn, Corrigan, & Donaldson, 2000). In contrast,
the SARS epidemic embarrassed the Chinese government and sparked e”orts to
improve access to and the quality of care. Finding solutions to such problems has
been a challenge because stakeholders cling to existing practices and technologies, data limitations make it di$cult to measure the quality of care, and fundamental disagreements remain about the meaning of quality and how to measure
value for money in health care.
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Chapter 4. Comparative Health Systems 93
LESSONS
Based on the experience of NHI and NHS systems in the countries we have examined, we would highlight four lessons for policy makers in the United States:
■■ Achieving the goal of universal health coverage requires legislation to make such coverage compulsory.
■■ Financing broader insurance coverage in the United States—beyond Medicare and
Medicaid—requires increasing government subsidies based on ability-to-pay criteria.
■■ Health care systems with universal coverage rely increasingly on economic evaluation
of health technology as a criterion for making coverage decisions.
■■ Containing health care costs has not been achieved without greater reliance than in
the United States on price regulation and systemwide budget targets.
!e ACA represents the most signi”cant health care reform since Medicare
and Medicaid in 1965 because it has increased signi”cantly the share of the population with health insurance coverage and redistributed the burden of health care
“nancing from those who are wealthier, younger, and healthier toward those who
are poorer, older, and sicker (see Chapter 3). We would argue that this legislation
draws heavily on the “rst two lessons of comparative experience (the mandate
and the move toward ability-to-pay criteria for “nancing health care) and less
so on the third (economic evaluation of health technology), and it ignores the
fourth (greater price regulation and budget targets). !is will bring the United
States closer to other wealthy nations in terms of population coverage. Yet the
U.S. health care system continues to present some striking contrasts to most
other wealthy nations. It remains a patchwork system characterized by a complex
combination of institutions that include an enclave of socialized medicine such
as the VHA, a social insurance program (Medicare), and social welfare programs
(Medicaid and Children’s Health Insurance Program [CHIP]); tax-subsidized
employer-based private insurance for about half of the population; and heavy
reliance on out-of-pocket payment for the population that remains uninsured,
similar to the situation in China, India, and most developing nations.
!e United States has the highest per capita expenditures; the highest salaries
for physicians and other professionals making up the health care workforce; and
the highest aggregate prices for hospitals, physicians’ services, and pharmaceuticals. Despite our drive to innovate and invest in the latest medical technologies, access to high-technology services, as well as to basic primary care services,
is highly inequitable compared with other OECD nations—but not with China,
which faces not only the usual inequities among populations of di#erent income
and educational levels, but also massive inequities among its urban and rural residents and, within cities, among its registered and migrant populations.
Another way in which the U.S. health care system di#ers from that of wealthy
OECD nations concerns the vast range of health insurance products we o#er
to our population, including the option (following the ACA) of not purchasing
health insurance, albeit with a “nancial penalty. Despite the emphasis on choice
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94 Part I. Health Policy
of insurer, many people !nd themselves con!ned to obtaining health care within
restricted provider networks outside which payment for services often becomes
una”ordable. #ere is no parallel to this problem in wealthy OECD nations such
as England, Canada, and France. In China, choice of too many insurance products is not the problem. #e situation there is far worse than in the United States
because a large part of the urban migrant population (about 250 million people) is typically excluded from decent health insurance coverage. #e problem
of internal migrants in China is substantial, but not surprising, for a system that
spends only 5.5% of its GDP on health care and has only recently set the goal of
providing universal coverage.
CASE EXERCISE—EUROPEAN LESSONS LEARNED
You are an employee of a think tank in Washington, DC. The director has been asked to testify
before a congressional committee on the following question: In reforming the ACA, what lessons should the United States learn from relevant experience abroad? Your job is to write
a memorandum that will help the director answer this question. In writing this memo, you
should address the following questions:
1. How can learning from abroad help policy makers engage in a process of self-examination of health policy at home?
2. Compare the NHS and NHI systems.
3. What should members of Congress know about China’s problems and aspirations in
health policy?
4. What lessons from abroad would be most relevant in reforming the U.S. health system?
t
DISCUSSION QUESTIONS
1. What are some reasons for studying health care systems abroad?
2. How do NHI and NHS systems compare with the health care system in the United
States?
3. How do most countries with similar levels of per capita income di”er from and resemble the United States with respect to cost, quality, and access to health care?
4. What can the United States learn from other OECD countries about how to extend
health coverage while containing health care expenditures?
5. How can health system performance be measured? Compare the approaches adopted
by WHO and the Commonwealth Fund.
6. How are the problems and opportunities di”erent for China than for the United States
and other OECD countries?
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Chapter 4. Comparative Health Systems 95
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5
Population Health
Pamela G. Russo and Marc N. Gourevitch
LEARNING OBJECTIVES
▶ Understand the differences between the medical and population health
models of producing health, including the difference between the concepts of
health care and health
▶ Explain how the two models lead to different strategies for interventions to
prevent disease and improve health
▶ Learn about the differential importance of various health determinants
▶ Review the evidence regarding social and physical environmental influences
on behavior and on health outcomes
▶ Review the variation in health and life expectancy between counties and
between countries
▶ Describe innovative synergistic approaches that integrate the clinical and
population models
KEY TERMS
▶ cross-sectoral collaborative approaches
▶ determinants of health
▶ dose-response effect
▶ health care
▶ medical model
▶ medically indigent
▶ multiple determinants of health
▶ neighborhood effects
▶ reverse causality
▶ social determinants of health
© Springer Publishing Company DOI: 10.1891/9780826172730.0005
Copyright 2019. Springer Publishing Company.
All rights reserved. May not be reproduced in any form without permission from the publisher, except fair uses permitted under U.S. or applicable copyright law.
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AN: 1998657 ; James R. Knickman, PhD, Brian Elbel, PhD, MPH.; Jonas and Kovner’s Health Care Delivery in the United States, 12th Edition
Account: s3563253.main.ehost
102 Part II. Keeping Americans Healthy
TOPICAL OUTLINE
▶ The population health model
▶ The medical model
▶ Comparing the medical and population health models
▶ The influence of social determinants on health behavior and outcomes
▶ Leading determinants of health: weighting the different domains
▶ Health policy and return on investment
INTRODUCTION
Much of this book concerns what happens within the walls of health care
institutions—hospitals, clinics, physician o!ces, and long-term care facilities.
Taking a more macro-level perspective,
however, reveals that health care is but one
of many factors that contribute to physical
and mental health in a population or society.
Other determinants—education and income,
genetics, behaviors, and environmental
exposures—are responsible for much of the health, or disease, in a population. In
fact, the e”ects of the systematic di”erences in health care are far smaller than
the e”ects of the nonrandom di”erences in other determinants of health on a
population’s overall health outcomes. #ese in$uences outside the health care
system greatly in$uence which groups of people are more likely to become ill in
the %rst place, to be injured, or to die early. #ese in$uences also help determine
people’s health care outcomes once they become sick, injured, or disabled. #is
chapter addresses the changes in health care and public policy emerging from the
growing appreciation of the profound in$uences on the population’s health that
occur outside the health care system, where the vast majority of people—or patients,
from a health care perspective—spend the overwhelming majority of their time.
#e notion that health is in$uenced by factors outside the health care
system is of course not new. Why, then, is it receiving renewed attention? More
than anything else, growing attention to population health re$ects widening
acceptance of, and mounting frustration with, the poor performance of the
United States on many indicators of health despite its excellence in many aspects
of health care. Decades of studies and reports have documented conclusively
that even in the face of unsustainably high spending on health care, the health of
the U.S. population lags behind that of nearly every other peer country (National
Research Council and Institute of Medicine, 2013). Armed with the more recent
understanding that countries with a higher ratio of social service to health care
spending have healthier populations (Bradley, Elkins, Herrin, & Elbel, 2011)
The physical and mental
health of our communities is
affected by more than just
health care.*
*To hear the podcast, go to https://bcove.video/2QEZxWe or access the ebook on Springer Publishing ConnectTM.
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Chapter 5. Population Health 103
and that inadequately addressed social factors are signi!cant drivers of health
care spending, policy makers are coming around to the notion that addressing
social determinants of health must be part of the solution to achieving national
health goals and health care cost-savings goals. Should policy makers seeking
to improve population health simply sidestep the health care sector if it
contributes only modestly to health at a societal level? Doing so would likely be
short-sighted, since health care is the sector in which resources earmarked for
health are almost exclusively concentrated in the United States. How, then, are
we to bridge the health care sector’s focus on and resources for health, with an
understanding of the broader societal factors that in fact determine so much
of health and disease? “erein lies the core challenge of the emerging !eld of
population health.
THE POPULATION HEALTH MODEL
Population health employs an integrative model in understanding and seeking
to improve the health of groups of people, acknowledging that di#erent factors
intersect and combine to produce good or poor health. “e population health
model seeks to explain and intervene in the causes of the systematic di#erences in
health between di#erent groups (Kindig & Stoddart, 2003). To do so, it analyzes
the patterns or distribution of health between di#erent groups of people in order
to identify and understand factors leading to di#erences in outcomes. “ese
factors are often described as “upstream” causes in the sense that they in$uence
health through a series of pathways that may not be immediately visible (see also
Chapter 7).
Population health scientists use the term determinants of health rather
than factor or cause, and they use the term multiple determinants of health to
describe the determinants that arise from !ve important domains:
■■ “e social and economic environment—factors such as income, education, employment, social support, and culture (often referred to as the social determinants of
health, or SDOH)
■■ “e physical environment, including urban design, housing, availability of healthy
foods, air and water safety, exposure to environmental toxins
■■ Genetics (and, more recently, epigenetics—the study of gene–environment interactions)
■■ Medical care, including prevention, treatment, and disease management
■■ Health-related behaviors, such as smoking, exercise, and diet, which in turn are shaped
by all of the preceding determinants
Health is therefore conceptualized as the result of exposure to di#erent patterns of these multiple determinants (Figure 5.1). Over the past 40 years, a signi!-
cant body of knowledge has developed that demonstrates the profound e#ects of
multiple determinants from di#erent domains as well as the interactions among
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104 Part II. Keeping Americans Healthy
them, their e!ects at di!erent stages in the life course from gestation to old age,
and their cumulative e!ects. Although the determinant categories are listed independently, they have substantial and complex interactions over the life course of
an individual or group.
Some health care outcomes can, in turn, a!ect the determinants; that is,
they can have a reverse causality e!ect on determinants. For example, whereas
social determinants such as income have an e!ect on outcomes, the outcome
of being unhealthy also can have a negative e!ect on income (Kindig & Chin,
2009).
THE MEDICAL MODEL
In contrast to the population health model, the medical model hones in
on individuals, focusing on the factors most immediately linked to the
pathophysiology underlying a person’s disease. It is a reductionist model in
the sense that it searches for the molecular and physiological mechanisms
that explain how speci”c factors produce illness or act as markers of incipient
disease. In turn, the therapeutic ideal is to “nd the “silver bullet” that will
FIGURE 5.1 A GUIDE TO THINKING ABOUT DETERMINANTS OF POPULATION HEALTH
Source: Institute of Medicine. (2003). !e future of the public’s health in the 21st century (p. 52). Washington,
DC: National Academies Press. Reproduced with permission from National Academies Press, Copyright
2002, National Academy of Sciences.
Broad social, economic, cultural,
health, and environmental conditions
and policies at the global, national,
state, and local levels
O V E R T H E L I F E S P A N
Innate Individual Traits:
Age, sex, race, and
biological factors
–––
The biology
of disease
Living and working conditions
may include:
• Psychosocial factors
• Employment status and
occupational factors
• Socioeconomic status
(income, education,
occupation)
• The natural and built
environments
• Public health services
• Health care services
Individual
Behavior
Social,
Family, and Community
Networks
Living and Working
Conditions
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Chapter 5. Population Health 105
85
80
75
70
65
HEALTH SPENDING PER CAPITA (US$)
LIFE EXPECTANCY (YEARS)
R2 = 0.51
IND
RUS
BRA
MEX
HUN
SVK
DNK DEU
CAN
LUX
NLD NOR
USA
CHE
FRA AUT
SUE
PRT
ESP
NZL
FIN
IRL BEL
ITA JPN
ISL AUS
GBR
ISR
CHL GRC CZE SVN
KOR
EST
POL
TUR
CHN
IDN
0 1000 2000 3000 4000 5000 6000 7000 8000 9000
Source: Organisation for Economic Co-operation and Development. (2013). Health at a glance. Paris, France:
Author. doi: 10.1787/health_glance-2013-en
FIGURE 5.2 ASSOCIATION BETWEEN HEALTH SPENDING AND LIFE EXPECTANCY
stop or reverse those mechanisms and thus cure or prevent progression of the
current medical problem.
!e medical model frames risk factors as working through disease-speci”c
pathways and typically analyzes risk factors as if they were independent in statistical modeling. !e medical model considers how di#erent biological systems
within the individual interact—for example, the endocrine system and the cardiovascular system—but the lens remains focused on the body.
Health care is generally reactive, meaning that it responds to abnormality, disease, or injury, and as a result has been characterized as a “sickness care
system” (Evans, Barer, & Marmor, 1994). Health care has traditionally been
delivered (and reimbursed) in acute episodes and has placed less value on and
provided less reimbursement for e#orts to promote health or to prevent illness
and injury. Although health care has achieved great strides in diagnosing, treating, and in some cases curing illness and injury, and although new knowledge
and technology are constantly increasing the capacity to preserve life, relieve
su#ering, and maintain or restore function, Americans’ chances for living long
and healthy lives are not improving, despite ever-greater U.S. spending on health
care (Figure 5.2).
!e United States is the outlier point on the far right—the highest health
care spending—yet Americans’ probability of survival to age 80 is lower than
that of other developed countries. !is marked discrepancy between the highest
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106 Part II. Keeping Americans Healthy
spending on health care and poorer survival rates is referred to as “the U.S. health
disadvantage” (National Research Council and Institute of Medicine, 2013). !e
di”erences between the medical and population health models can help explain
the reasons for the disparity between the United States and other developed
countries as well as the severe disparities within the United States among di”erent populations.
COMPARING THE MEDICAL AND POPULATION HEALTH MODELS
Consider two examples, obesity and tobacco use, that illustrate the di”erent explanatory and intervention approaches of the medical model versus
the population health model. In the medical model, when an adolescent with
obesity visits a health care provider, the
provider will likely assess the patient’s
family history, diet, and physical activity.
!ese may be followed by laboratory tests
to rule out hormonal or other physiological causes for obesity and to check for diabetes and other consequences of extreme
overweight. Interventions are likely to include referrals to nutritionists and
recommendations for decreasing calories and increasing physical activity,
with regular monitoring. In very serious cases (morbid obesity) or with failure
to achieve weight loss through these means, the patient may be referred for
bariatric surgery.
!e medical model does not focus on why an epidemic of obesity has occurred
over the past 30 years or investigate why there are higher rates of obesity in lowincome and minority populations or grapple with the circumstances that make it
di#cult for many patients to comply with medical recommendations for eating
less and exercising more.
In contrast, the population health model has identi$ed a wide variety of
causes that have worked synergistically—an unintended conspiracy of causes
over time—to produce the high rates and di”ering patterns of obesity observed
among population groups. Such causes may include:
■■ Higher density in low-income neighborhoods of fast-food restaurants, which o”er
high-calorie, high-fat, low-nutrient, supersized meals at low prices
■■ !e presence of vending machines that sell high-calorie soft drinks as a source of
needed revenue in schools
■■ Subsidized school lunches with high caloric and fat content—a result of agricultural
policies
■■ !e decrease in physical education classes and near-elimination of recess periods,
due to shrinking school budgets and a narrow focus on meeting academic test score
requirements
■■ Fewer children and adults walking or bicycling to school or other destinations, due in
part to the lack of sidewalks, safe pedestrian crossings, and bicycle lanes
The medical model does not
focus on why an epidemic of
obesity has occurred over the
past 30 years.
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Chapter 5. Population Health 107
■■ Fewer safe places to play or walk in urban, low-income neighborhoods
■■ A lack of grocery stores with healthy food options such as fresh fruit and vegetables
in many neighborhoods, due to the higher cost and lower pro!t margins of these
foods
■■ Marketing obesogenic foods to children
“ese social and physical environmental determinants strongly limit people’s
behavioral choices. It is di#cult to achieve lasting lifestyle behavioral changes
among people who do have the economic resources to join gyms, have child care
while they exercise, and a$ord healthier food choices. Such goals are more challenging still when healthy choices are largely beyond !nancial reach.
In a population health framework, relevant interventions could include
zoning law changes; menu labeling; working with fast-food industries to provide
healthier, but low-cost menu options; educational policies that encourage healthy
food choices and increased physical activity in schools and after school; and so
on. Such interventions are not traditionally considered part of the health care
arena. Making the healthy choice the easier choice is not always su#cient; programs to change behavior boost the chances that people will make those healthy
choices their default choices. Such programs might include workplace or community programs to encourage physical activity in the form of walking, bicycling,
or other exercise or cooking classes using nutritious, a$ordable, noncalorie-dense
foods.
Tobacco use o$ers a second example. In the medical model, the focus is on
individual patients who smoke or chew tobacco. “e solution is framed in individual terms and is geared toward behavioral change through cessation counseling and nicotine replacement options. Success requires having access to providers
who support and encourage cessation (see Chapter 7).
In the population health model, the understanding of the problem includes
the in%uences of tobacco production, advertising, distribution, and patterns of
use in di$erent groups, as well as the policies used to intervene include smokefree laws, tobacco taxes, and regulation of advertising and marketing. “ese
population-wide policy changes have changed U.S. social norms regarding
the acceptability of tobacco use and led to dramatic decreases in the rate of
smoking.
As with programs to increase physical activity and healthy eating, policy
changes to reduce smoking are usually coupled with increases in access to cessation programs at the community level, such as free quitlines and free nicotine
patches, which assist smokers in quitting. “e population health model also
enables targeting policies toward groups with the highest rates of tobacco use,
and it responds to tobacco industry actions to redirect their advertising from the
more a&uent smokers who are able to access cessation programs to new, more
susceptible markets, including youth, minorities, and people in developing countries (Kreuter & Lezin, 2001).
In short, key determinants of health are often shaped by policies and programs in sectors not traditionally considered as residing within the health care
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108 Part II. Keeping Americans Healthy
sector. In the obesity example above, the education sector is key to changes in
school environments. Changes in zoning laws can alter the proximity of fast-food
restaurants or liquor stores to schools or parks. Cross-sectoral collaborative
approaches are essential to addressing underlying causes of poor health and
therefore to improving health and health equity at the population level.
THE INFLUENCE OF SOCIAL DETERMINANTS ON
HEALTH BEHAVIOR AND OUTCOMES
!e medical model is well accepted and respected by health care providers and
by basic science, clinical, and health services researchers. Indeed, medical knowledge is widely viewed as grounded in “hard science” and thus re”ecting “truth”
about the causes of disease. !e population health model, conversely, with its
inclusion of social science and diverse methods and data sources, is less widely
perceived as scienti#cally rigorous. While few may doubt that poverty and lack
of education are associated with worse health—as the Australian-born population health researcher John Lynch says, population health is the “science of the
bleedin’ obvious”—many are not aware of the magnitude and rigor of the scienti#c evidence underlying these #ndings or of the e$ectiveness of associated
population-level interventions.
In fact, substantial advances have been made in de#ning the pathways by
which social determinants in”uence health—in other words, how these factors
“get under the skin”—using a wide variety of research methods, from experimental psychology and neuroimaging, to exploring the pathophysiology of how
chronic stress causes in”ammation, to epigenetics. For a comprehensive review
of the research on the interaction between social determinants and human biology, see Adler and Stewart (2010).
Early and important research on health determinants was based on epidemiological #ndings linking morbidity and mortality to socioeconomic status,
de#ned by education, income, or occupational status. One of the earliest studies
to demonstrate the importance of such factors was Michael Marmot’s Whitehall
study, a longitudinal study conducted over two decades with results reported
throughout the 1970s and 1980s (Evans et al., 1994). !e British data were especially enlightening because they included a measure of social class, based on
occupation.
!e Whitehall study collected extensive information on more than 10,000
British civil servants, from the lowest rung of the income and rank hierarchy to
the highest. Marmot found that the likelihood of death was about three and a half
times higher for those in the lowest status rank (clerical and manual workers) than
for those in the highest administrative jobs. Mortality rates increased steadily
with every reduction in rank.
Such a steady increase is known as a gradient in the population health
model and a dose-response effect in the medical model, where it is taken
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Chapter 5. Population Health 109
as evidence of a robust relationship between causal factor and outcome. All
of the workers in this population had steady, paying jobs, and none had high
exposure to work-related toxins or other risks in the physical environment.
All had access to the British National Health System. The gradient in
heart disease mortality continued to be present after adjusting the data for
different rates of smoking, high blood pressure, and high cholesterol. In
other words, after controlling for the traditional medical model risk factors,
the 3:1 difference in death rate by social class could not be explained away.
Marmot and others went on to investigate the role of stress associated with
occupational rank.
Decades of study of the stress response have rigorously demonstrated its
negative impact on health, mediated by multiple physiological pathways. A wide
variety of stressful stimuli have been studied, including social subordination,
lack of job control, discrimination, social isolation, economic insecurity, job loss,
and bankruptcy. More recently, the impact of racism has also been studied in
this framework. A proposed common pathway is that greater exposure to stress
over time leads to chronic activation of physiological responses that, by virtue of
resulting conditions (e.g., neurophysiological adaptations, elevated blood pressure, heightened in!ammatory responses), result in elevated rates of morbidity
and mortality. For example, babies born to mothers who fear targeting by immigration raids are more likely to be of low birth weight (Novak, Geronimus, &
Martinez-Cardoso, 2017).
Scientists increasingly recognize that the mechanisms by which social determinants act depend on the context in which people encounter stressful events.
One area of research focuses on neighborhood effects, which include the interaction of social and physical environmental determinants; for example, the negative interaction between the physical environment (poor housing, presence of
crime and violence, absence of stores with healthy foods) and social determinants
related to poverty.
Data on the links between social factors and health and the wide variations
in health among groups can be found in a report from the Robert Wood Johnson
Foundation Commission to Build a Healthier America (2014), a national, independent, nonpartisan group of leaders who investigated how factors outside the
health care system shape and a”ect opportunities to live healthy lives. #e Commission’s team of researchers compared average life expectancy by county and
found signi$cant variations. For example, the average life expectancy in Wolfe
County, Kentucky, is 70 years, compared with 78 years in nearby Fayette County—
a di”erence of 8 years. Such $ndings of stark di”erences in life expectancy or other
health outcome according to race/ethnicity, gender, sex, sexual orientation, place,
and income have focused attention on the goal of achieving health equity. Health
inequities “systematically put groups of people who are already socially disadvantaged (e.g., by virtue of being poor, female, and/or members of a disenfranchised
racial, ethnic, or religious group) at further disadvantage with respect to their
health” (Braveman & Gruskin, 2003). Building toward health equity, therefore,
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110 Part II. Keeping Americans Healthy
requires incorporating an intentional focus on combatting underlying causes of
inequity—from structural racism to lack of parity in wages to underinvestment in
early childhood education—into initiatives to improve population health.
Two of the most predictive factors of life expectancy are income and degree
of education. Examination of the relationship between measures of education
and income on U.S. life expectancy showed that:
■■ College graduates can expect to live at least 5 years longer than those who did not
complete high school.
■■ !e gap in life expectancy between the richest 1% and poorest 1% of individuals in
the United States is 14.8 years for men and 10.2 years for women (Chetty et al., 2016).
By way of context, in 2017, the federal poverty level (FPL) was $20,780 for a family of
three.
■■ Even middle-income Americans can expect to live shorter lives than those with higher
incomes, whether or not they have health insurance.
!e Commission also examined the relationships among health status, educational attainment, and racial or ethnic group. !e measure of health status was a
self-reported assessment of one’s own health as excellent, very good, good, fair, or
poor. Self-reported health status corresponds closely with assessments made by
health professionals. Indeed, among adults studied by the Commission’s research
team, those who reported being in less than very good health had rates of diabetes and cardiovascular disease more than “ve times as high as the rates for adults
who reported being in very good or excellent health. Additional highlights of the
Commission’s results include:
■■ Overall, 45% of adults ages 25 to 74 reported being in less than very good health, with
rates varying among states from 35% to 53%.
■■ Adults with less than high school degrees were more than two to three times as likely to
be in less than very good health than college graduates. !ere was also a clear gradient
in health by educational level.
■■ Health status varied across racial or ethnic groups; non-Hispanic Whites were more
likely to be in very good or excellent health than other groups nationally and in almost
every state. In some states, non-Hispanic Black and Hispanic adults were more than
twice as likely as White adults to be in less than very good health.
■■ Analyzing both social factors simultaneously, non-Hispanic Whites had better health
status than adults in any other racial or ethnic group at every level of education. !e
gradient in health by educational level within each racial or ethnic group is shown in
Figure 5.3.
Educational attainment may in#uence healthy choices and better health via
multiple pathways. For example, people with more schooling may have a better
understanding of the importance of speci”c healthy behaviors, or higher educational attainment may lead to higher-paying jobs with greater economic security, healthier working conditions, better bene”ts, and greater ability to purchase
more nutritious foods and live in a safe neighborhood with good schools and
recreational facilities. Figure 5.4 demonstrates that behavior and education both
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Chapter 5. Population Health 111

Black,
Non-Hispanic
Hispanic Asian American Indian
or Alaska Native
Percent of Adults Ages 25–74 Years,
in Less Than Very Good Health
Other White,
Non-Hispanic
U.S.
Overall
National
Benchmark
45.2
19.0
Source: Robert Wood Johnson Foundation Commission to Build a Healthier America (2009). Beyond health
care: New directions to a healthier America. Princeton, NJ: Robert Wood Johnson Foundation.
FIGURE 5.3 GRADIENTS WITHIN GRADIENTS
a!ect health: At every level of educational attainment, adults who smoke and do
not participate in leisure-time exercise are less likely to be in very good health
than adults who do not smoke and do get exercise.
Similar to educational attainment, racial discrimination can a!ect health via
multiple pathways. A substantial base of evidence exists regarding the e!ect of
di!erent policies on both discrimination and health. Exposure to discrimination
in and of itself provokes a physiological stress response in the lab, and repeated or
sustained exposure leads to chronic, unhealthful activation of the stress response.
A variety of policies have combined to maintain or worsen Black–White segregation by neighborhood, despite the civil rights legislation of the 1960s. Residential
segregation in”uences diverse social determinants of health, including educational and employment opportunities, access to safe and a!ordable housing, routine opportunities for physical activity, food “deserts” with scarce access to fresh
healthy foods, and exposure to violence. #ere is strong evidence that reducing
or eliminating residential segregation would substantially diminish Black–White
di!erences in income, education, and unemployment, and in turn racial disparities in health (Williams & Collins, 2001).
As noted earlier, the population health model calls for integration of the
multiple determinants of health, with consideration of both negative and positive interactions among di!erent factors. #e relationships between socioeconomic status and health are complicated, but the most persistent disparities in
health between groups clearly involve the intersection of multiple types of social
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112 Part II. Keeping Americans Healthy
Less Than
High-School
Graduate

Percent of Adults Ages 25–74 Years,
in Less Than Very Good Health
Some College College
Graduate
46.8
National
Benchmark
19.0
U.S.
Overall
45.2
Source: Robert Wood Johnson Foundation Commission to Build a Healthier America (2009). Beyond health
care: New directions to a healthier America. Princeton, NJ: Robert Wood Johnson Foundation.
FIGURE 5.4 HEALTH-RELATED BEHAVIORS AND EDUCATION BOTH AFFECT HEALTH
disadvantages (Adler & Stewart, 2010). !e interconnected nature of social categorizations such as race, class, and gender as they apply to a given individual
or group result in overlapping and interdependent systems of discrimination or
disadvantage, as described by the concept of “intersectionality” (Schulz & Mullings, 2006).
LEADING DETERMINANTS OF HEALTH: WEIGHTING
THE DIFFERENT DOMAINS
!e “ve di#erent domains or categories of health determinants, described earlier in this chapter, do not make equal contributions to the health outcomes of
populations. !is is not “new news.” In the 1970s, !omas McKeown (1976)
concluded that improved health and longevity in England over the previous 200
years resulted from changes in food supplies, sanitary conditions, and smaller family sizes, rather than medical interventions.
In the United States, John Bunker and colleagues (1995) estimated that during the
20th century, medical care explained only
5 of the 30-year increase in life expectancy
During the 20th century,
medical care explained only 5
of the 30-year increase in life
expectancy.
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Chapter 5. Population Health 113
and, between 1950 and 1990, when many new therapies were developed for infectious diseases and heart disease, medical care accounted for only 3 of the 7 years
of life expectancy increase.
Medical care also can be responsible for increasing mortality rates. A 2000
Institute of Medicine (IOM) report publicized the startling !nding that medical
errors accounted for approximately 2% to 4% of U.S. deaths annually (Kohn, Corrigan, & Donaldson, 2000), placing medical error among the top causes of death
(Bleich, 2005).
“ere was a period of time in the 1990s during which medical scientists
expected that genetics could explain much of the variation in health between
groups and individuals, yet the role of genetics in understanding such variation
remains unresolved. Recent initiatives to study genetic factors at the population
level, such as the National Institutes of Health (NIH) – sponsored All of Us project to enroll 1 million individuals in a cohort study collecting data on multiple
domains of health, will deepen knowledge on this important front.
Health behaviors (e.g., smoking, physical activity, substance abuse, sexual
activity, diet) are considered major determinants of health in both the medical and
population health models. Analysis of data from 22 European countries showed
that variations in health disparities could be attributed to variations in smoking,
alcohol consumption, and access to care but that the patterns of determinants of
inequality were di#erent for men and women, by country, and by which outcome
was measured (Mackenbach et al., 2008).
“e best weighting scheme to determine the combined e#ects of determinants from di#erent domains depends on the health outcome of interest. Some
outcomes will be more dependent on certain determinants than on others.
Researchers have therefore estimated the relative contributions of the multiple
determinants of health through what are called summary measures of mortality
and morbidity—that is, measures that summarize the length and quality of life.
Signi!cant progress has been made in accumulating the empirical data that can
yield the best approximations of the relative weights of each domain on summary
health outcomes.
McGinnis and Foege (1993) reviewed the relevant literature from 1977 to
1993 to analyze the leading causes of U.S. deaths. “ey concluded that approximately half of all deaths in 1990 were due to key behavioral factors, led by tobacco
use and followed by diet and physical activity. Related estimates included that
about 40% of deaths were caused by behavioral factors, 30% by genetics, 15%
by social determinants, 10% by medical care, and 5% by physical environmental
exposures. Ten years later, an IOM (2003) analysis revised the 1990 estimate of
50% of all deaths upward to 70% of all deaths being due to key behavioral and
environmental factors. “e Centers for Disease Control and Prevention (CDC)
updated the McGinnis and Foege analysis and concluded that smoking remained
the leading cause of preventable deaths, followed by poor diet and lack of physical activity (Mokdad, Marks, Stroup, & Gerberding, 2005).
“e annual national County Health Rankings report, !rst launched in 2010,
ranks the overall health of every county within each of the 50 states and reports
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114 Part II. Keeping Americans Healthy

PROGRAMS
AND POLICIES
HEALTH
FACTORS

HEALTH
OUTCOMES
EDUCATION
EMPLOYMENT
INCOME
FAMILY & SOCIAL SUPPORT
COMMUNITY SAFETY
ENVIRONMENTAL QUALITY
BUILT ENVIRONMENT
ACCESS TO CARE
QUALITY OF CARE
TOBACCO USE
DIET & EXERCISE
ALCOHOL USE
UNSAFE SEX
Source: University of Wisconsin Population Health Institute (2010). County Health Rankings and Roadmaps 2018. Retrieved from http://www.countyhealthrankings.org/county-health-rankings-model
FIGURE 5.5 COUNTY HEALTH RANKINGS MODEL
the contribution of the multiple determinants of health on each county’s overall
health using a population health framework. Health outcomes are viewed as the
result of a combined set of factors, and these factors are also a!ected by conditions, policies, and programs in their communities. “e report is based on a
model that compares overall rankings on health outcomes with rankings on different health factors (Figure 5.5).
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Chapter 5. Population Health 115
!e County Health Rankings report estimates the in”uence on health and longevity of (a) health behaviors at 30%, (b) clinical care at 20%, (c) social and economic factors at 40%, and (d) physical environmental factors at 10%. !ough there
is a range of opinion on the merits of accounting for all causes of health and disease
in such models (Krieger, 2017), the rankings have powerfully demonstrated dramatic variation between one county and another in health outcomes and in health
determinants. !is variation is even greater than the variation in health care expenditures and health care outcomes that has been demonstrated over many years
by health service researchers. For example, the premature death rate in the least
healthy counties was two and one half times greater than in the healthiest counties.
!e bottom-line message of the County Health Rankings project is that where
people live matters to their health. !e population health framework enables
communities to see which factors are contributing the most to their poor or good
health outcomes, and thus choose to act to improve the factors a#ecting health,
vitality, and productivity of all community residents.
HEALTH POLICY AND RETURNS ON INVESTMENT
In a logical world, the more that is known about the causes of a signi$cant problem, the more resources would be allocated toward reducing the most important
of those causes. In the United States, two-thirds of what we spend on health care
is attributable to diseases that are preventable. But we invest less than 5% of our
more than $3 trillion annual health spending on e#orts to prevent these illnesses,
whereas 95% goes to direct medical care.
Yet, for the reasons set forth above, only
perhaps 10% to 15% of preventable deaths
could be avoided by increasing the availability or quality of medical care.
!e population health model suggests
that investments and policy decisions in
areas that are not traditionally considered
the province of health care are more likely
to have a signi$cant e#ect on improving a
population’s health than increased spending
on medical services. Indeed, the share of the
U.S. GDP that is spent by the health care sector on processes, tests, and treatment of little value has been likened to theft from other sectors such as education,
in which comparable investment could have a far more profound and enduring
impact on health (Berwick & Hackbarth, 2012). An excellent review of the challenges and e#ect on health of policies in the areas of education, income transfer,
civil rights, macroeconomics and employment, welfare, housing, and neighborhoods is provided in a comprehensive text by Schoeni, House, Kaplan, & Pollack
(2008).
Researchers are only beginning to be able to provide the evidence to guide
policy makers regarding the comparative e#ectiveness and costs of speci$c
The population health model
suggests that investments and
policy decisions in areas that are
not traditionally considered the
province of health care are more
likely to have a signi!cant effect
on improving a population’s
health than increased spending
on medical services.
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116 Part II. Keeping Americans Healthy
investment choices across the !ve categories of health determinants, re”ecting in
part methodologic challenges arising from interactions among determinants, the
latency over time of their e#ects, and the sparsity of robust longitudinal data sets.
Nevertheless, this evidence base is growing rapidly, as shown by research estimating that correcting disparities in education-associated mortality rates would
have averted eight times more deaths than improvements attributable to medical
advances between 1996 and 2002 (Woolf, Johnson, Phillips, & Philipsen, 2007).
Another example comes from a study by the Urban Institute, which calculated
the return on investment for prevention and concluded that an investment of $10
per person per year in proven community-based programs to increase physical
activity, improve nutrition, and prevent smoking and other tobacco use could
save the country more than $16 billion annually within !ve years. $is is a return
of $5.60 for every $1 invested (Trust for America’s Health, 2008).
$e Robert Wood Johnson Foundation Commission to Build a Healthier
America delivered a series of evidence-based policy recommendations to improve
health, including the following:
■■ Provide high-quality early developmental services and support for all children.
■■ Fund and design the Special Supplemental Nutrition Program for Women, Infants,
and Children (WIC) and the Supplemental Nutrition Assistance Program (SNAP, also
known as food stamps) programs to meet the need of hungry families for nutritious
food.
■■ Eliminate so-called food deserts through public–private partnerships.
■■ Require healthy foods and physical activity in all schools (K–12).
■■ Ensure that decision makers in all sectors have the evidence they need to build health
into public and private policies and practices.
$e last strategy underscores the need to consider the health e#ects of policies,
programs, and projects in sectors not traditionally thought of as a#ecting health.
$is can be achieved through the use of health impact assessments (HIAs; www
.healthimpactproject.org), which have a long history of use in the same countries
that have led the way in developing and acting upon the population health model.
HIAs have been used in a wide variety of decisions regarding transportation,
housing, zoning, and other aspects of the built environment and more recently
have been used to address social policies related to education, labor, criminal
justice, segregation, and other areas. HIAs are one of the tools that can be used to
bring a health lens to policy, program, and project decisions made in nonhealth
sectors, an approach known as health in all policies (HIAP).
While population health interventions have the potential to create much
greater improvements in the health of Americans than further spending increases
for medical services, a core challenge is to !nd sustainable approaches to !nancing them. Over the past 5 years, a number of innovative methods have been implemented to direct funding to community-level prevention initiatives addressing
social, physical, and economic environments. One model is a wellness trust: a
fund set aside speci!cally to support population-wide interventions or policies.
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Chapter 5. Population Health 117
Funds for a wellness trust can come from a number of sources, such as a tax on
insurers or hospitals, as was done in Massachusetts in 2013. Another innovation
is a variation on social impact bonds as health impact bonds (also referred to as
Pay for Success). Capital is raised from private investors to implement community or state prevention interventions, and the resulting health care cost savings
are returned to the investors as break-even or pro!t. A number of health impact
bonds are in progress, including home remediation of mold and other triggers of
childhood asthma to reduce unnecessary hospitalizations and emergency room
visits for asthma in multiple communities, or improving birth outcomes through
the Nurse-Family Partnership in South Carolina.
Another potential source of funding is community bene!t spending by
nonpro!t hospitals. Since the 1950s, to keep their tax-exempt status, nonpro!t
hospitals have owed certain duties to the community, largely focusing on providing charity care to the medically indigent. Concurrently with the passage of
the Patient Protection and A”ordable Care Act (ACA), amendments were made
to the Internal Revenue Service code that increased the rigor and consistency
of hospital reporting, requiring hospitals to perform a community health needs
assessment every 3 years with collaboration from public health experts and the
community and to use the resulting !ndings as the basis for conducting community health improvement activities. Such activities can include investments
in community-based health services that are furnished outside of and are not
billable by the hospital, as well as more upstream interventions addressing social
and physical environmental determinants like investing in housing to improve
health. #ese ACA-based changes have stimulated increased collaboration by
many hospitals with public health and community partners, although the degree
to which hospitals are committing funds to identi!ed community priorities varies widely.
Other innovations include the concept of a “health dividend,” which refers
to the opportunity cost of waste in health care spending, estimated at $750 billion per year. If this waste could be eliminated and the funding recaptured, the
money could be used to improve key determinants of population health—for
example by investing in education, job training, or improving the built environment (McCullough, Zimmerman, Fielding, & Teutsch, 2012).
Additional potential population health !nancing innovations result from the
implementation of the ACA. #e Prevention and Public Health Fund, intended
to provide stable funding for increased activities to improve community health,
supported a number of programs to improve population health using place-based
strategies, such as Community Transformation Grants. However, the fund was
also used to !ll gaps in the implementation of health care changes under the ACA
and has been a continual target of those opposed to the health reform act.
Other opportunities have resulted from the ACA, including accountable
care organizations (ACOs) and Medicaid waivers and innovation grants. ACOs
are essentially networks of providers and hospitals that share responsibility for
the health care and health outcomes of a set of patients. ACOs provide savings
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118 Part II. Keeping Americans Healthy
incentives by o!ering bonuses when providers keep costs down and meet speci”c quality benchmarks, focusing on prevention and carefully managing patients
with chronic diseases. In other words, providers get paid more for keeping their
patients healthy and out of the hospital. To do this well requires that providers
and hospitals work in the community beyond the walls of their institutions to
ensure better care coordination—and better social and physical conditions for
promoting health. ACOs were designed to lay the foundation for the anticipated
transition by the Center for Medicare and Medicaid Services (CMS) toward
value-based payment. Another innovation opportunity came from state waivers
for delivery of Medicaid. For example, the Texas Medicaid waiver was constructed
such that 5% of the billions of dollars in the waiver was earmarked to support
public health interventions that would prevent illness or injury and thus save
Medicaid money. #ese payment model innovations, like those mentioned previously, require careful evaluation to document their ability to bring about population health improvements and to decrease health care costs. More recently, some
Medicaid managed care organizations have begun to move toward global budgeting, freeing them to be able to consider funding community interventions like
supportive housing if they led to better health outcomes (and lower total costs)
for their capitated populations. Innovative variations on this approach to improving both health care delivery and the health of clinical populations care have been
set in motion in numerous states through “accountable health communities” that
take on responsibility for both health care and identifying and addressing social
determinants of health among participants (Alley, Asomugha, Conway, & Sanghavi, 2016).
Recognizing the impact that factors outside the health care system can have
on health care utilization and costs, the health care sector is beginning to screen
patients for social determinants of health like housing, transportation, and food
insecurity. A challenge to this approach is that while it may be relatively easy
to identify a patient’s social stressor (e.g., unstable housing), putting into place
referral systems that are e$cient and e!ective and generate feedback to the provider (as expected for other referrals made during the course of clinical care) can
be a major challenge. Innovative solutions, such as local mapping of community
health-related assets and social service referral software integrated with the electronic health record, are beginning to demonstrate promise toward this important goal (Lindau et al., 2016).
CONCLUSION
Recognition of the importance and value of population health science and of the
population health model to advancing health in the United States has accelerated
greatly in the last decade. Examples include:
■■ An extensive literature of high-quality publications in top U.S. medical, health care,
and public health journals as well as books in multiple disciplines
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Chapter 5. Population Health 119
■■ National Institutes of Health and CDC funding of multidisciplinary population health
research and intervention programs
■■ Numerous National Academy of Medicine review committees and reports on the
multiple determinants of health and its Roundtable on Population Health Improvement
■■ Interdisciplinary population health centers and training programs at premier universities across the country and the emergence of departments of population health at
leading academic medical centers
■■ !e MacArthur Research Network on Socioeconomic Status and Health, a research
working group funded by the MacArthur Foundation, which operated from 1998 to
2010
■■ National commissions on population health and prevention, including the Robert
Wood Johnson Foundation’s two reports from the Commission to Build a Healthier
America
■■ !e annual national County Health Rankings report based on a multiple determinants
of health framework as well as similar initiatives at the city level (e.g., the City Health
Dashboard)
!e population health model is increasingly accepted as a framework for
understanding the multiple determinants of health, with an emphasis on prevention and a strong basis in scienti”c evidence. Importantly, the term “population
health” also entered the lexicon of clinical practice in 2007 as part of the Institute for Healthcare Improvement’s (IHI) Triple Aim initiative to (a) improve the
health of the population, (b) enhance the experience and outcomes of the patient,
and (c) reduce per capita cost of care for the bene”t of communities. !e Triple
Aim initiative’s use of the phrase “population health” has led to some confusion in
terminology. Noting this, the IHI stated in 2014 that “population health” refers to
the broader determinants of health, whereas the Triple Aim refers to “population
medicine” as the management of a discrete population in a health care system,
health plan, or ACO to improve outcomes.
!ere is great potential for population health strategies to aid medical care
providers in improving the outcomes for their patients. As noted earlier in this
chapter, population health is not only about primary prevention; the social, behavioral, and environmental determinants of health also strongly a#ect patients’ ability and likelihood to carry out medical care providers’ recommendations about
changing lifestyle behaviors or preventing social crises (such as losing a job or
becoming homeless) that in turn trigger serious health crises.
As envisaged in the 2003 IOM report on the future of the public’s health,
collaboration among those using the medical, governmental public health, and
population health models would provide a more coherent national approach to
health improvement. Such an approach would include a common, integrated set
of metrics for determinants and outcomes, provide sustainable realigned funding, and result in more strategic and synergistic planning for the actions best
suited for improving the conditions needed for all Americans to have the opportunity to lead healthy lives.
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120 Part II. Keeping Americans Healthy
CASE EXERCISE—SODIUM AND ITS EFFECTS ON OUR HEALTH
Recent data show that Americans consume, on average, more than three times the recommended level of sodium per day in their food and beverages. High salt intake contributes to
high blood pressure and its complications—stroke, heart attack, congestive heart failure, and
kidney failure. In fact, thousands of lives could be saved if sodium consumption were lowered
in people with high blood pressure. Write a memo for the U.S. Secretary of Health and Human
Services about what might be done to address concerns about the effect of high sodium intake
on health. In preparing your memo, consider the following questions:
1. How might we address this problem in the patient population using the medical model
that a health care provider might use versus a population health model that a public
health of!cial might use?
2. How far can and should governments go in attempting to create a more healthful environment? Intrinsic to many population health policies is the specter of the so-called
nanny state. In this case, is it necessary for everyone to be exposed to lower sodium in
their bread, in other common foods, and in restaurants, so as to protect people who have
salt-sensitive illnesses?
3. Should manufacturers bear the costs of manufacturing different versions of foods in
order to protect the public’s health? Should they be required to manufacture healthier
foods, even if customers prefer the less healthy versions? Or should they be liable if they
don’t manufacture healthier foods?
t
DISCUSSION QUESTIONS
1. !e general public equates the word “health” with “health care.” Polls asking people
about their health typically result in responses about their health care experiences.
How do you de”ne health? How would you assess a population’s health if you could
ask the people in that population only one question on a survey?
2. Why do some people refer to the health care system as “the sickness care system”? Do
you agree or disagree with this term?
3. Cross-sectional research shows that, on average, people with disabilities secondary
to illness or injury have lower socioeconomic status than people without disabilities.
How could longitudinal research help to explain whether this is because people of
lower socioeconomic status are at higher risk of developing disabilities or because disability leads to loss of income and thus lower socioeconomic status? In a population
health model, how might lower socioeconomic status increase the risk of disability
secondary to illness or injury?
4. !e Commission to Build a Healthier America found that non-Hispanic Whites were
more likely to be in very good or excellent health than other groups nationally and in
almost every state. In addition, non-Hispanic Whites had better health status than
adults in any other racial or ethnic group at every level of education, but all groups
showed a gradient in health by educational level. What are some of the determinants
that are likely contributing to this disparity in health between non-Hispanic Whites
and other groups after controlling for di#erent educational levels?
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Chapter 5. Population Health 121
5. It is possible that a community’s County Health Rankings would suggest that the
biggest driver of poor health in that community is unemployment. How would you
present the case to your nonpro!t hospital board that the biggest community bene!t
contribution the hospital could make would be to join and support an initiative to
increase job openings in the community, rather than holding health fairs or o”ering
educational lecture series?
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6
Public Health:
A Transformation
in the 21st Century
Laura C. Leviton, Paul L. Kuehnert, and Kathryn E. Wehr
LEARNING OBJECTIVES
▶ Discuss why a healthy population is in the public interest
▶ Contrast defining characteristics of prevention-oriented public health and
treatment-oriented health care
▶ Identify the core functions of public health
▶ Define essential public health activities
▶ Describe state, federal, tribal, and local authority for public health laws,
regulations, and services
▶ Identify how challenges and opportunities are transforming public health
KEY TERMS
▶ Association of State and Territorial Health Officers (ASTHO)
▶ health (World Health Organization definition)
▶ health impact assessments (HIAs)
▶ health promotion
▶ health status of entire populations
▶ multisectoral collaborations
▶ National Association of County and City Health Officials (NACCHO)
▶ nongovernmental organizations
▶ policy development
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124 Part II. Keeping Americans Healthy
▶ population health
▶ primary prevention
▶ Public Health Accreditation Board (PHAB)
▶ secondary prevention
TOPICAL OUTLINE
▶ Overview of a complex infrastructure
▶ Public health requires a collective response from society
▶ Public health is different from individual health care
▶ The core functions of public health define essential public health activities
▶ Governmental agencies have legal authority for the core functions
▶ Various social, economic, and political forces are transforming public
health
OVERVIEW OF A COMPLEX INFRASTRUCTURE
!is chapter introduces the policies, programs, and practices that constitute public
health in the United States. Public health is “what society does collectively to assure
the conditions for people to be healthy” (Institute
of Medicine, 2002). It is the science, practice, and
art of protecting and improving the health of
populations (Kindig, 2015). We “rst describe
the goals and characteristics of public health
that di#erentiate it from health care treatment, and we outline the core functions of
public health. We then describe the complex network of laws, regulations, authorities, and services
involved. Federal, tribal, state, and local government agencies, often called the infrastructure, have legal authority for the core functions. At the same time, champions of
public health span many public, private, and nonpro”t organizations. In the concluding section, we describe forces at work to transform public health in the 21st century.
Historically, public health emphasized regulating and improving community
sanitation, monitoring environmental hazards, and care of poor mothers and children. Over time, it greatly expanded its role in
documenting and controlling communicable
diseases and encouraging health promoting
behavior. In the late 20th century, many local
health departments were the provider of last
resort for indigent health care. With passage
Public health is “what society
does collectively to assure the
conditions for people to be healthy”
(Institute of Medicine, 2002).
Public health focuses on
entire populations and the
design of policies, systems,
services, and environments to
achieve not just the absence
of disease, but a collective
sense of well-being.*
*To hear the podcast, go to https://bcove.video/2DY99Vw or access the ebook on Springer Publishing ConnectTM.
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Chapter 6. Public Health: A Transformation in the 21st Century 125
of the Patient Protection and A!ordable Care Act (ACA) in 2010, health departments began to reorganize and direct more resources to prevention as more people
received health insurance. “e ACA included an unprecedented single investment
in its Prevention and Public Health Fund, which also enabled this shift. However,
federal funding for prevention has since declined, the ACA is in jeopardy, state
funding has been level since 2010, and state and local health departments have
seen a 20% drop in personnel since 2008 due to budget cuts (see the following). It
is too soon to predict a long-term trend of support for government-funded public
health, given political volatility in 2018. What is certain is that the principles and
services we describe in this chapter are quite simply necessary to ensure the health
of populations. Public health activity only accounts for an estimated 1% to 3% of
national spending (Leider et al., 2016), yet greater spending per capita is linked to
decline in preventable deaths (Mays & Smith, 2011). And despite politics, there is
growing recognition that public health in the United States needs to move away
from piecemeal responses to health problems toward a more coherent and comprehensive approach. Public health champions are also working far beyond the
conventional health sector to advocate for a broader set of policies and systems
changes that improve and protect health.
Public Health Every Day
Public health activities a!ect the lives of Americans profoundly, but more often
than not these activities are invisible. A thought experiment shows how this
works. Imagine waking up and going through your morning routine. You slept 8
hours for a change because health experts claim that lack of sleep causes stress
and other health problems. You wander
into the bathroom and brush your teeth—
teeth that are still in your mouth and pain
free thanks to regular brushing and #ossing,
adequate nutrition, and routine dental visits.
You feel that good habits are your personal
responsibility, but you take for granted the
services and policies that made these choices possible. You also take for granted
that your environment keeps you healthy. Fluoride in your local water supply
helps strengthen your tooth enamel and prevents cavities. You rinse your mouth
with water that is safe to drink. Before it ever reached your faucet, it was checked
for sickness-causing bacteria, heavy metals such as lead (which harm children’s
brains and nervous systems), and chemicals such as polychlorinated biphenyls
(which cause cancer). When you #ushed the toilet, the waste did not get into the
water supply where it could kill you.
You get your children ready for school; so far, they have all survived, never having had measles, diphtheria, polio, or other diseases that killed and maimed so many
children in bygone days. “ank goodness for immunizations. “e kids’ breakfast
includes cereal and pure pasteurized milk. You looked at the nutritional label on
their cereal and saw whole grains and not too much sugar—some food companies
are feeling the pressure and voluntarily o!ering healthier kids’ cereals these days.
Public health activities affect the
lives of Americans profoundly,
but more often than not these
activities are invisible.
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126 Part II. Keeping Americans Healthy
!e news feed warns that a new in”uenza strain is spreading, and the authorities
have renewed their advisory for hand washing and travel precautions. Your sister
calls to announce she is going to have a baby! She is not aware that the toast she is
eating is forti#ed with folic acid, the B vitamin that prevents birth defects. !anks
to comprehensive sex education and family planning, the couple never had (or were
quickly treated for) gonorrhea and chlamydia infection, which can cause infertility.
!e two of you also discuss your father. He’s over 70 and not in the best health,
so he needs to get his “u and pneumonia shots right away! !e last time he had
“u, it turned into pneumonia; he went to the hospital and could have died. Both
of you are worried about him because he is overweight, still smokes, and never
exercises. Is a heart attack, diabetes, or stroke in his future? !e odds are not in
Dad’s favor. Programs to quit smoking are available in the community without
charge, so you agree that Dad’s doctor should try suggesting them again. Too bad
there are no sidewalks in Dad’s neighborhood; he loves to walk, but there is too
much tra$c. Does the senior center have an exercise program that might appeal
to him? You buckle the kids into their safety belts. When you get to your job, you
see signs that read: “607 days without an accident at this worksite” and “proud to
be tobacco free since 2008.” !ese everyday experiences are not just about making healthier choices on your own, but about public health giving the opportunities for healthier choices and making healthier choices the easy choices.
Divided Responsibilities and Issue-Specific Organizations
!e responsibility for the public’s health and the infrastructure to make it work
are divided among many agencies across all levels of government and many
nongovernmental organizations, professional associations, and businesses (see
Figure 6.1). In our thought experiment, for example, municipal authorities handle
waste water, but the federal government regulates chemicals in the water supply.
!e federal government recommends physical activity for older adults, but local
organizations like senior centers, YMCAs, private gyms, and city departments
of transportation, parks and recreation, and public safety all make it possible to
be physically active. !e federal government requires seat belts and air bags in
cars, but state laws mandate seat belt use and the penalties for violation, and local
police generally enforce the laws.
At least four factors account for the complexity and di%use responsibility for
public health in the United States. !e #rst factor is that the U.S. Constitution calls
for decentralized government; states have authority for public health, except where
speci#ed by federal and tribal law. How much authority the states in turn share
with local government varies a great deal and rests with diverse agencies, boards of
health, and municipal and tribal codes (Hodge, 2012; Institute of Medicine, 2011).
Second is the distinctive American tendency, #rst recognized by Alexis de
Tocqueville in the 1830s, to design laws, policies, and organizations that are
problem-speci#c, rather than general. For example, individual diseases receive
special legal recognition, and new federal programs, policies, and categorical
funding streams are created to deal with them. As seen in the following, such
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Chapter 6. Public Health: A Transformation in the 21st Century 127
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