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Health Law II
University of California, Hastings School of Law
King, Jaime S.

I.                  Overview of US Healthcare System
A.                Iron Triangle: Cost, Quality, & Access
1.                  Strategies to fix: (1) increase in supply, e.g. more hospitals, physicians; (2) improve health of population (preventative medicine, access to drugs, etc. (3) administrative controls and planning (price ceilings, utilization, managed care); (4) cost-consciousness (deductibles, co pays); (5) physican should control (fee for service). FUCHS thinks that geater emphasis should be put on physician, rather than administrative controls and patient behavior.
a)                  marginal cost = marginal benefit
(1)               Socially optimum level of spending (i.e. additional increment of health exactly equals cost of the resources required to obtain that increment)
2.                  Cost
a)                  Cutler “Your Money or Your Life”
(1)                America’s new technologies are much greater than any other country but also much more expensive, and these technologies, along with lack of preventative care and fee-for-service medicine (fee for service drives technology), drive health care costs (but the costs are worth it)
(a)               -“You get what you pay for”: in the early 20th century, a limited ability to treat people kept the cost of medical care low; low spending in turn led to a limited demand for health insurance (if being sick was not expensive, did not need health insurance), whereas now, knowledge of disease and expansion of technical capabilities has increased the value of medical care, and a demand for medical care translated into a demand for health insurance
(b)               -Bottom line: incentives in our system, whether they are intentional or unintentional, have led to the creation of a lot of high tech innovations and very expensive pharmaceuticals, and these things, overall, provide us with a lot of value (in general) BUT they may not be the most cost-effective approaches (procedures are really expensive and often overused, which in turn drives the cost up again)
b)                  What drives costs?Not ur typical free market → INELASTIC DEMAND
(1)               Lack of information/expertise/transparency for consumer
(a)               Providers get tons of power cuz we have to rely on them →det wat/when order tests
(2)               Market Structure→ 3rd party payers changes incentives
(a)               Ppl and drs don’t know costs of their procedures and don’t care anyway since they rntpayin
(b)               No rationing
(3)               ADMINISTRATIVE COSTS
(4)               Waste, Fraud and Abuse; Malpractice
(a)               Small area variations
(b)               Overtreatment/unnecessary careà tons of tests that do little to help doctors diagnose diseases and that sometimes lead them to find and treat conditions that would never have bothered their patients had they not been found
(i)                  Why do doctors and hospitals deliver so much Unnecessary Care? 
(a)                 (1) Doctors lack the evidence they need to know which treatments are most effective and which drugs/devices really work; (2) doctors lack the training to interpret the quality of evidence that is available; (3) malpractice fears; (4) medical custom; (5) fee for service: most doctors are paid for how much care they deliver, not how well they care for their patients (and patients comply because they are buffered by insurance), (6) moral hazard
(5)               Population Aging; Changing Nature of Disease→ ppl smoke less/live longer; Treating “Hopeless Causes” ($$, only live extra few months, may not even be successful)
(6)               Technology (see cutler above)
(7)               Moral Hazard→If insurance masks the real cost→ u r more likely to incur costs than u otherwise would if u had to pay for it all urself→ gonna def go to that extra follow up visit if its cheap for u (also full coverage=engage in risky behavior) [tendency to overuse products they r insured for] (8)               Adverse Selection→ sickies go for comprehensive plans but healthies only get the cheapos/wait till get sick→ drives up costs of sickies cuz they rnt subsidized by healthies
(a)               Individual mandate/risk corridor aimed at this
(9)               Mr Fix it?
(a)               Drug fast track
(b)               Transparency
(c)                Increase/decrease free market
(d)               Drs: put them on salary (Remove financial temptation); Restrict the ability of doctors to benefit from referring patients to ancillary services; Factor patient evaluations of their treatment into the doctor’s review process; Dont offer bonuses to doctor’s for reducing costs of care.
3.                  Quality
a)                  “doing right thing at right time for the right person and having the best results possible”
(1)               System evaluation shows: misuse of preference-sensitive care, poor communiation b/t doctor and patient; pt depends on doctor for opinion; inadequate evaluation of evolving treatment theory; effects of health care finance system that rewards procedures, not time spent with patient→ so if hosptial has more beds or more drs then more care provided (not necessarily beneficial)
b)                  Measuring Quality: structure→ process→ outcomes
(1)               Mr Fix It?
(a)               EMR, barcoding instead of names
(i)                  (1) fewer medical tests (no redundancy); (2) higher quality patient care (puts physicians on alert to treatment risks, provides electronic reminders for certain standard actions; improves case management); (3) improved emergency care outcomes (can quickly access in ER); (4) more efficient Rx drug processing (no illegible handwriting confusion); (5) fewer patient burdens; (6) better public health monitoring
(a)                 Problems: (1) implementati

ant stabilize and cant treat can transfer if medical benefits of transfer outweighs risks and new hospital can help better/agrees to accept cuz have space +qualified ppl
(i)                  Must notify patient
(ii)                Must sign off on transfer
(iii)              Must send records, use proper ambulance
(c)                Enforcement:
(i)                  Civil penalties against hospital/dr
(ii)                Private right of action for ppl against hosptial (NOT dr) for damages/suffering incurred by transfer)
(a)                 Claim “inappropriate medical screening”
(i)                  u need a standard procedure and u treat all patients the same
(ii)                doesn’t have to custom/wat other drs would do/standard of care etc-very based on the hospital's capabilities etc–only need a screening, and actually do it that’s sufficient
(iii)              Real Q is–did hosptial deviate from what it would normally give to a patient in this situation?
(b)                 Claim “inappropriate transfer”
(i)                  Patient had a condition
(ii)                Hospital knew of the condition (HIGH burden)
(iii)              Patient not stabilized before transfer
(iv)               Prior to transfer, hospital did not obtain proper consent
(d)               Purpose: gap filler only–don’t want ppl to just get dumped into public hospitals that couldn't care for them
(i)                  *No duty to provide uncompensated care beyond stabilization, or if u don’t have an emergency condition
(ii)                *If uradmitted into hospital but u cant pay then they can just discharge u
(2)               ACA + EMTALA
(a)               ACA requires insurers to pay for emerg care under prudent Layperson standard→hospitals like cuz now insurers cant skirt reimbursements for services the hospital was required to provide under EMTALA
(b)               Changes for Nonprofit Hospitals
(i)                  Will get reimbursed for ppl that qualify for Medicaid even if not enrolled yet→ hospital can enroll them right then!!
(ii)                Have to provide more than just stabilization cuz have to provide trtmt regardless of ability to pay
(iii)              Still has same policy that admission to the hospital ends EMTALA obligations! But that’s where malpractice picks up