Healthcare Government Regulations the Role of Government Essay

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Healthcare Government Regulations

The role of government regulatory agencies and government regulations in general is particularly important in health care. The reasons for this are many, but the most important of those reasons is that health care delivery is a special case with regard to consumer use, as to some degree all individuals have the right to safe and ethical treatment and treatment that above all else does no harm. Government regulatory agencies and government regulations therefore become a sort of watch dog for healthcare, attempting to make sure that treatment to all patients is safe, ethical and equitable. Government regulatory agencies are especially keen on identifying universal barriers to health care by establishing public insurance, rules and regulations as well as funding and also attempting to eradicate some of the health care disparities that exist today. To do so they have created and regulate many pieces of legislation that serve as standard bearers for healthcare. In so doing they can also cause unintended complications which can result for some in greater barriers to care rather than lesser. This work will briefly discuss the ways in which two government regulatory agencies and regulations create unintended consequences that create greater barriers to care for some consumers and discuss how these agencies and regulations affect providers.

The above statement may seem contradictory as the full intention of many government regulatory agencies and regulations is clearly to improve quality and access for millions and for the most part most do. The exceptions occur when programs create consequences like refusal of service to patients and/or complicated, costly and hard to understand and apply programs and services. The examples that will be given in this work that demonstrate the effects of regulatory programs on health care delivery individuals and organizations are two; the Medicare reimbursement schema and the relatively new Health Insurance Portability and Accountability Act (HIPAA). Though both these programs at their core serve to improve quality and access for consumers to health care providers in the end some of the legislative consequences are just the opposite.

With regard to Medicare, universal health coverage for those over 65, the program and agency revolutionized the manner in which health care providers bill for services by creating diagnostic codes as well as standard reimbursement caps for nearly all procedures performed by providers. In other words the program created a guideline, often used for private insured, private pay and Medicare patients that sets a limit on how much a provider can bill for any given procedure. Medicare then attempt to control how much it and the patient pays for those services by allowing Medical reimbursement on a scale from 50-80% of the total billable service. What this essentially does is say to the provider, "this is how much you can bill us for a given procedure, but we will only pay you for part of it and the rest you have to either get elsewhere or simply go without." Medicare reimbursement percentages are also based on provider experience, were those who are new to the system (i.e. new doctors) get a lesser percentage than those who have been around for a while, who get the maximum 80% reimbursement, which is still lower than what they would receive from private pay patients or private insurers.

This system in and of itself discourages providers from treating Medicare patients and with changes associated with the new Patient Protection and Affordable Care Act (PPACA), as amended by the Health Care and Education Reconciliation Act (Reconciliation Act) Medicare, public insurance for the poor, that is reimbursed at only 72% of Medicare reimbursement will be expanded greatly, "Already, some physicians decline to participate in the Medicare program because of low reimbursement rates, and linking Medicare participation with accepting Medicaid patients is likely to accelerate this trend, " (Rothstein, 2011, p. 92). The result will be countless providers who opt out of treating Medicare and/or Medicaid patients as well as those who carry both forms of insurance. Today, as a community health care provider I have heard from many patients the story of calling more than ten doctors and clinics a day before they finally, after months of eligibility by Medicare and/or Medicaid or after their former doctor retires, find one who will take them on as a new patient. In the end they do not have a choice of providers they simply chose the first provider who will agree to treat them.

Additionally, it is clear from the current enrolment of providers participating in the Medicare program that possibly greater than 50% will retire in the next 10 years, leaving an additional gap that will be difficult to fill by providers who will receive even less reimbursement than their predecessors in a climate and economy that requires a great deal more expenditure to run a business (Rothstein, 2011, p. 93). What this essentially creates is a possibly extreme shortfall of providers just when the new regulations are set to flood the system with millions of newly insured health care consumers.

A similar issue is occurring in pharmacy provision with the passage of the Medicare part D drug plan, where individuals who are covered by Medicare get coverage for a great many of their prescriptions, and reimbursement for drugs to the pharmacy (total amount paid to pharmacy by both Medicare programs and the patient) can and often does result in a significant reduction in reimbursement, comparable to private insurance and private pay and can often even result in filling prescriptions at a loss. Though Medicare D. is not nearly as bad as the new drug reimbursement formularies for Medicaid the whole of the program is hitting retail private pharmacy providers very hard. These pharmacies were already reeling from costly new technology upgrades, increased cost and number of licensures that were mandated by other regulations and the ability of corporate stores to charge low prices for prescriptions as a standard because they do not rely heavily on pharmacy profits to maintain the profitability of their stores and can buy in large quantities at lower rates. As one independent pharmacist put it, "It's like asking someone to sell $20 bills for $5 a piece -- you'll do a lot of business for a while, but you won't stay in business for long," said Matthew Kopacki, owner of Rock Ridge Pharmacy in Glen Rock," (Prial, July 18, 2007). According to the same resource, "independent pharmacists say the new formula requires them to accept reimbursement for generic drugs that average about 36% less than the price they have to pay for the drugs," (July 18, 2007) As standard setting programs, Medicare and Medicaid may also serve as an example to private insurers (of which all Medicaid D. providers are) to lower reimbursements at similar levels and drive profitability even lower. On a note of example after almost 4 years of these reimbursement schedules all insurers are getting very bold with regard to setting "contract" prices for prescription drugs that are lower than cost.

This is not to say that the Medicare system is all bad or even that the reimbursement and billing caps do not serve an important purpose, reducing the potential for abuse with regard to charging for services, and giving many providers a guideline for treatment and care. The reality is that with any large scale program there will be drawbacks, but this particular draw back may seriously affect the outcome of care for millions of people and result in a dirge of elderly without access to the most basic services.

The second regulatory agency / regulation system that I will discuss is associated to a large degree with the previous note about required technology upgrades for pharmacies and all other health care providers. The Health Insurance Portability and Accountability Act otherwise known as HIPAA, has set a standard for transition to electronic medical records. The development of these technologies was costly and the systems are equally costly, ranging in updates for current technologies to whole transaction systems, such as Point of Sale systems in pharmacies where customer's prescription history as well as signatures for all their dispensed prescriptions are logged at the point of sale can range anywhere from $20,000 to hundreds of thousands of dollars for larger numbers of integrated terminals. These technologies are part of the HIPPA regulations and can only be avoided in rare cases where many stipulations are met. Similarly, Physicians offices have been given first incentives and then mandates (on a timeframe) to begin using electronic prescription sending systems integrated with patient electronic records, that transmit prescriptions directly to pharmacies electronically. The intention of the system was to create cost reductions, reductions in prescription writing errors as well as to improve the speed of transmission of prescriptions to pharmacies and integrate electronic patient records to some degree, all of which are great but according to some researchers greatly over exaggerated (Webster, 2011). Having had the experience of working with electronic prescriptions (regulated by HIPAA) there has been a long and…[continue]

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