Propose an economic initiative that presents an opportunity for your care setting at both the micro (departmental, neighborhood) and macro (organizational, community) levels that you believe will provide ethical and culturally equitable improvements to the quality of care.
· In this assessment, you will propose an economic initiative that presents an opportunity for improved care quality.
As an emerging health care leader, the senior management has requested that you independently research and explore one of the economic opportunities that may be available in your care setting. This may be offering a new service line, working to improve a service line already offered, retiring an outdated or unprofitable service line, or any other economic initiative that you believe will be of benefit to your care setting in the short and long term. One example of this is a recently launched partnership with a local bicycle sharing company. Your care setting partners with them to host healthy community events that offer free screenings for early detection of various health issues. This helps fulfill some of your care setting’s preventive and healthy lifestyle initiatives, while also potentially driving referrals to other services provided by your care setting. You have been asked to submit your proposal in the form of a 2–4-page executive summary that includes your proposed economic initiative, supporting economic data, and an analysis of the proposal’s benefits for your department and for the care setting overall.
You have been asked to ensure that your report addresses the following. Note: The bullet points below correspond to grading criteria in the scoring guide. Be sure your work is, at minimum, addressing each of the bullets below. You may also want to read the scoring guide and the Guiding Questions: Executive Brief: Proposal of New Economic Opportunity document, linked in the Resources, to better understand the performance levels that relate to each grading criterion:
· Propose an economic initiative that presents an opportunity for your care setting at both the micro (departmental, neighborhood) and macro (organizational, community) levels that you believe will provide ethical and culturally equitable improvements to the quality of care.
· Analyze the supply and demand for your proposed economic initiative within contexts relevant to your care setting.
· Explain relevant economic and environmental data that support your proposal and analysis.
· Communicate your economic proposal in a logically structured and concise manner, writing content clearly with correct use of grammar, punctuation, and spelling.
· Effectively support your proposal with relevant economic data and scholarly sources, correctly formatting citations and references using current APA style.
Example Assessment: You may use the assessment example, linked in the Assessment Example section of the Resources, to give you an idea of what a Proficient or higher rating on the scoring guide would look like.
Your assessment should meet the following requirements:
· Length: 2–4 double-spaced, typed pages. Your proposal should be succinct yet substantive.
· APA format: Resources and citations are formatted according to current APA style.
· Resources: Cite 3–5 authoritative and scholarly resources. Be sure to include specific economic data and support as part of your cited resources.
Assessment 1 Context
Health Care Economics: An Industry Overview
Providers and consumers of health care services have experienced significant changes following the enactment of the Patient Protection and Affordable Care Act of 2010 (Affordable Care Act). New terminology, concepts, methods of valuation, reimbursement, and decisions accompanied this landmark legislative change. Health care leaders are responsible for maintaining the financial viability of their organizations, aligning with both the organizational mission statement and directional strategy, and allocating finite resources. This task has become increasingly complex due in part to changes associated with the Affordable Care Act.
Conditions of participation in state-funded and federally funded health care programs have generated new requirements, and some represent major challenges with respect to implementation and compliance. An example of this can be seen with the electronic medical records (EMR) initiative, which has been an ongoing challenge. Leaders must grapple with questions such as:
• What is the actual cost to the organization?
• Are there funding shortfalls for full implementation?
• Are there unexpected additional costs that result from existing software incompatibilities?
• Are there additional security measures to ensure HIPAA compliance, such as staff training?
• What about patient satisfaction scores and how these can affect reimbursement?
The role of the health care executive in exercising sound economic decision making has become increasingly challenging, especially when one considers the potential adverse financial and operational consequences, or civil and criminal penalties, that can result from oversights or errors. Health care executives serve in a fiduciary role within their organizations and communities. To this end, it is helpful for leaders to understand applicable laws that drive economic decision making and its accepted tools from authoritative sources, industry standards, and risk management.
The Provider Organization
How have recent changes in health care affected your current or future desired role within the industry? Do you recognize new concepts and terminology emerging with our changing health care system? To illustrate this point, consider your familiarity with the following economic concepts and their associated implications for providers: accountable care organizations, Readmissions Reduction Program, HCAHPS scores, HAC Reduction Program, never events, value-based purchasing, open payments public data, cost shifting, risk sharing, and medical capital equipment (lease versus purchase). These are just a few examples of facets that involve financial, and thus economic, decision making.
It is important to maintain the environmental, larger perspective and to understand what resources are available from the government for economic problem solving and decision making. It is also important to maintain “bifocal vision” as you consider demand, supply, and finite human and financial organizational resources.
· Propose an economic initiative that presents an opportunity for improved care quality.
Master’s-level health care practitioners are charged with the responsibility of constantly scanning the external environment for shifts in supply of and demand for services. Concurrently, leaders must examine strategic fit with their organization’s directional strategy and determine if adjustments need to be made for current service offerings, updates in equipment, changes in staffing models, and a variety of other decisions. Each decision that is proposed must be evaluated in terms of the health care setting as a system, alignment with the mission and strategy, available internal resources, potential contract and payer source implications, and the short- and long-term economic effects at both the micro and macro levels.
Note: Complete the assessments in this course in the order in which they are presented.
By successfully completing this assessment, you will demonstrate your proficiency in the following course competencies and assessment criteria:
· Competency 1: Analyze the effects of financial and economic factors (such as cost-benefit, supply and demand, return on investment, and risks) in a health care system on patient care, services offered, and organizational structures and operation.
· Analyze the supply and demand for a proposed economic initiative within contexts relevant to a care setting.
· Competency 2: Develop ethical and culturally equitable solutions to economic problems within a health care organization in an effort to improve the quality of care and services offered.
· Propose an economic initiative that presents an opportunity for a care setting at both the micro and macro levels, and that will provide ethical and culturally equitable improvements to the quality of care.
· Competency 3: Justify the qualitative and quantitative information used to guide economic decision making to stakeholders and colleagues.
· Explain relevant economic and environmental data that support a proposal and analysis.
· Competency 5: Apply various communication methods in order to clearly, effectively, and efficiently relate information to stakeholders and colleagues related to economic data, findings, and strategies.
· Communicate an economic proposal in a logically structured and concise manner, writing content clearly with correct use of grammar, punctuation, and spelling.
As a health care leader, you will be challenged to maintain organizational financial viability and to participate in team-based decision making. A few examples of critical economic decision-making topics are the acquisition of necessary capital medical equipment, adjustment of clinical staffing ratios, funding unexpected implementation and maintenance costs of EMRs, and funding under-insured and uninsured patient care.
Economics in health care can vary from the typical dynamics of other industries. The rules of supply and demand are influenced in unique ways. Examples of this can be seen in the fact that physicians can both supply services as well as control demand for health care services. Additionally, consumers of health care services can have a need or demand for services, but may not be able to access supply or available care due to geography or financial constraints (such as a high insurance deductible).
Suppliers or providers of care can deliver a service and not be reimbursed for the service by the consumer if various quality and satisfaction standards are not met. Government regulations can also impact reimbursement. An example of this can be observed in a problematic readmission within 30 days of a patient’s discharge from a hospital. If the readmission meets criteria for being preventable, the provider may not be reimbursed for services, nor may the provider bill the patient for services already consumed.