Healthcare Financing: Investing in Healthier Communities Your Name, MD, FAAP Name of Practice City, AL

How are healthcare providers paid?  Cash  Third-party insurers  Government programs  Self-insured corporations

Government programs  CHIP (ALL Kids in Alabama)  Medicaid (federal-state partnership) –Poor children 100% poverty level ($35k family of 4) –Pregnancy –Elderly poor/nursing home care –Disabled who qualify –Adult extreme poverty  Medicare (federal program for the elderly, certain disabled adults and kidney disease)

CHIP  ALL Kids –Funding began in 1997 –Provides child-friendly benefits package –Administered by ADPH –ADPH contracts with BCBS to provide benefits & services through its provider network –Co-pays and premiums based on family size and income

Medicaid  Alabama Medicaid is a minimum federal standards program  Pays providers to care for children under a managed care, medical home model  Covers vision, dental, medications  50% of babies born in Alabama are born to mothers covered by Medicaid  Boosts economic development – paying providers in excess of $20 million annually in more than two-thirds of the state’s counties by drawing down federal $$ in 3:1 match

Cash  Choose no coverage and pay cash  Choose catastrophic coverage and pay cash for visits  Do not qualify for insurance at work and do not meet income requirements for Medicaid or CHIP

Group Insurance  Many companies write policies for large groups of employees  Premiums paid by employer and employee  Benefits vary from poor to complete coverage

Underinsured  Insurance that provides some benefits, frequently vaccines are NOT covered –This is most costly part of care for children  ADPH has two-tiered system for vaccines –Medicaid and no insurance are covered by the Vaccines for Children Program –Underinsured cannot get most expensive vaccines through this program at their doctors’ office

Corporate self insurance  Company official decides what services and care will be covered and at what rate –May subcontract for medications to mail- order pharmacy –Restrict providers, pharmacies, etc.

HSA (Health Savings Account)  Usually high-deductible plan  Best for young adult with no dependents  Due to check-ups and vaccines, not a good option for children

Innovations  Some companies have HSAs to cover medications, durable medical equipment, etc.  Providing well care with no co-pay to reward well care, health maintenance

Where we need to go  Large insurers need to know that health maintenance—preventive care--and medical homes save money and provide better care.

Why is Preventive Care Important? For the first time in the history of civilization, infectious diseases are no longer the number one cause of death in the world. Now it is heart disease and cancer! Children who are frequently counseled about the consequences of tobacco are less likely to smoke. Hypertension, obesity and asthma identified and treated early prevents or delays heart attack, end-stage kidney disease, diabetes and chronic lung disease.

Well Child Care  Well-child care truly is one of the greatest values in medicine. The cost of AAP- recommended preventive pediatric care for a healthy child from the first birthday to the second, for example, is about $600 for the year. This is a bargain. It includes three well-child visits, physical exam, growth charting, blood pressure screenings, vision and hearing screenings, developmental/behavioral assessments, and vaccines.

The Case for Health Promotion & Preventive Care: Immunizations  Vaccines are cost-effective and cost- saving.  Routine childhood vaccination program saves nearly $10 billion in direct medical costs and $43 billion in societal costs for every birth cohort  Lack of coverage and adequate payment for vaccine and its administration are impacting access.

The new children’s diseases  Child abuse and neglect  Early dental caries  Obesity  Mental health disorders – 20-25%  School failure  Adolescent pregnancy  HIV and AIDS  Substance abuse including tobacco  Juvenile crime/violence

The Case for Health Promotion & Preventive Care: Developmental  Developmental disabilities can occur at any time in childhood and can result in delayed learning, autism, and other physical or mental impairment  Approximately 17% of children 17 years or less in US have at least one developmental disability  Children with developmental disabilities who are identified and treated early have better long-term outcomes.

The Case for Health Promotion and Preventive Care Benefits for preventive care should also include:  Screenings for developmental delays, hearing, vision, blood lead levels  Pediatric obesity services including, but not limited to, clinical assessment, prevention, evaluation and treatment of obesity by the primary care physician to avoid more expensive future costs for treatment of adult obesity and related health risks.  Counseling, coordination of care, and consultations to enable pediatricians and other primary care providers to provide primary mental health services

Bright Futures Guidelines  Comprehensive health supervision guidelines  Developed by multidisciplinary child health experts  Provide framework for well-child care from birth to age 21  Present single standard of care based on health promotion and disease prevention model  Replaces former American Academy of Pediatrics Guidelines for Health Supervision

Bright Futures Guidelines  Bright Futures recommends 31 visits between birth and 21 years of age to include comprehensive health assessments, age-appropriate screening, counseling, preventive medication and treatment, parent/child education and anticipatory guidance.  Bright Futures also recommends a prenatal visit  Ideally, care is provided in the medical home.

The Medical Home  The American Academy of Pediatrics (AAP) believes that the medical care of infants, children, and adolescents ideally should occur in a medical home in which care is accessible, continuous, comprehensive, family centered, coordinated, compassionate, and culturally effective.  It should be delivered or directed by well-trained physicians who provide primary care and help to manage and facilitate essentially all aspects of pediatric care.

The Medical Home  The physician should be known to the child and family and should be able to develop a partnership of mutual responsibility and trust with them.  In contrast to care provided in a medical home, care provided through emergency departments, walk-in clinics, and other urgent-care facilities, though sometimes necessary, is more costly and often less effective.

Business Case for Preventive Care  The National Business Group on Health (NBGH) developed Plan Benefit Model  Adapted clinical guidelines from professional medical organizations, healthcare groups and federal health agencies, including Bright Futures  Applied actuarial analysis to the Plan Benefit Model components, including preventive care  New movement to embrace Patient- Centered Medical Home

Patient-Centered Primary Care Collaborative ( Coalition of: Major employers Major employers Consumer groups Consumer groups Primary care physicians Primary care physicians Mission: To advance the patient- centered medical home

Business Case for Preventive Care  Preventive services can prevent or reduce the need for treatment  Screening is less expensive than treatment, resulting in saving healthcare dollars  BOTTOM LINE: Early investment in child healthcare reaps larger returns for financers of healthcare.

Business Case for Preventive Care AND…  The added time and stress associated with caring with a child with a medical condition may result in employees experiencing:  Higher medical claims for parent and child  Lower productivity at work (parent) and school (child)  Increased absenteeism  Early exit from the workforce

For more information: Alabama Chapter- American Academy of Pediatrics Contact Information Pediatrician Name, MD, FAAP Street Address City, AL Zip Address

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