Recent developments in organizing and financing health-care services

Recent developments in the organization and financing of health-care services are described. All recent developments reflect an effort by both private and public payers to restrict use of health-care services, as well as to control price. Private use-review programs, such as second-surgical-opinion services and case-management services, are increasingly being used. The number of hospital admissions and length of patient stay continue to decline, but, because of increasing complexity of care, the cost of pharmaceutical services has not decreased proportionately. Points relating to health-care financing in the federal reconciliation budget effective May 1, 1986, are reviewed, as are other new federal regulations affecting the structure of services and terms of reimbursement under the Medicare and Medicaid programs. For Medicare, these include new scope objectives for professional review organizations, decreased return-on-equity payments to for-profit hospitals for outpatient services and to skilled nursing facilities, and elimination of waiver-of-liability presumptions for hospitals. Also, physicians must now identify specific services provided during each inpatient hospital visit. Most developments related to home health-care services pertain to limiting the cost of durable medical equipment. Alternative types of health care based on capitation funding, such as health maintenance organizations, competitive medical plans, and preferred provider organizations, will continue to grow in both the public and private sectors, and the use of private use-review programs for controlling costs is expected to accelerate in the next year.