Healthcare Reform in Modern Conditions: New Health Policy

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Table of Contents

Core Characteristics of the Policy
Ethical Principles Involved
SWOT Analysis of the Policy. Benefits and Disadvantages of the Policy
The Policy Implications for Nursing Practice
Measures to Improve the Policy
Summary
References

A healthcare reform in modern conditions is an integral part of the transformation of the social sphere as a whole and the general process of transformation of the American society. WHO defines the concept of “reform” as “a focused, dynamic, and sustainable process that leads to systematic structural changes” (Vogenberg & Santilli, 2018, p.49-50). In other words, a healthcare reform is both a normative, economic, and organizational type of activity. This comprehensive nature of the reform is clearly seen in the case of such legislative initiatives on Health Policy as Out-of-Network Consumer Protection, Transparency, Cost Containment, and Accountability Act in New Jersey.

Core Characteristics of the Policy

The Out-of-Network Consumer Protection, Transparency, Cost Containment, and Accountability Act (Assembly Bill 2039) was passed as a law on June 1, 2018, and came into force on August 30, 2018 (“Out-of-Network consumer protections,” n.d.). The Act considers health insurance and healthcare providers; it offers advanced protection for consumers receiving health care services from out-of-network providers (Cooper & Scott Morton, 2016).

The enhancements, in particular, include requirements on disclosure by providers and carriers, thus ensuring transparency. Also, the Act covers the arbitration system establishment for disputes concerning out-of-network payment and protection of consumers regarding various out-of-network bills (Cooper & Scott Morton, 2016). In fact, the Act’s main aim is eliminating some kinds of so-called “surprise” out-of-network payment requirements, in particular, for cases of hospital emergency room services.

The bulk of the document contains procedures for claims processing and arbitration for out-of-network services provided on inadvertent or urgent basis covered under the Act. The healthcare facilities violating any provision of the Act will be subjected to not more than $1,000 for each violation (up to $25,000 per occurrence) (“Out-of-Network consumer protections,” n.d.). “Healthcare professionals who violate the Act will be liable for up to $100 per violation, where each day on which a violation occurs is considered a separate violation, up to $2,500 per occurrence” (“Out-of-Network consumer protections,” n.d.).

Other fines may be implied by the Commissioner of Health, as well as Commissioner of Banking and Insurance, or the appropriate professional or licensing board. Moreover, the Act offers a process of arbitration for resolving cases of out-of-network billing disputes, thus providing multi-step arbitration process to be applied in New Jersey.

Ethical Principles Involved

Obviously, the requirements to improve cost control and increase the productivity and effectiveness of healthcare should be properly balanced with deeply rooted ethical imperatives. These imperatives are regarding universal access to essential medical care, as well as the fairest distribution of medical care, regardless of the social class status of citizens (Cooper & Scott Morton, 2016). Measures to reform the healthcare system should be evaluated guided not only by considerations of any short-term savings, but also taking into account its ability to constantly improve the health status of the population according to WHO principles.

Nowadays, increasing commercialization is a fundamental challenge for medicine. The market stimulates its participants to a certain type of behavior. The traditional ethical values of medicine (the principle of good for the patient) contradict exclusively commercial goals (maximizing profit). In its most obvious form, this is expressed in the displacement of the attitudes of medical facilities – from providing help to ensuring sales.

The problem of increasing commercialization of medicine is now actively discussed in the medical and ethical literature (Ahmadiani & Nikfar, 2016; Wacasey, 2016), and its solution has not yet been found. However, it is obvious that one has to reckon with the reality of the market. The only realistic way is to systematically counteract the side effects of commercialization. The Act under consideration seeks to counter them by limiting the potentially unethical actions of billing unjustly.

US government spending on medicine totals trillions of dollars. However, for a particular patient, the service will be of ‘paid’ nature, and medical bills have become the main reason for the bankruptcy of individuals. It is said that every “normal American” can afford insurance that will cover all the costs of medical services (Brown, 2017). However, even today, after several years of implementing the “socialist” reform of the Affordable Care Act (Obamacare), with compulsory insurance for everybody, about ten percent of the country’s inhabitants remain unreached.

At the same time, there are positive examples that the business itself provides. Today, in developed countries, including in the USA, the concept of socially responsible business is being increasingly introduced. This concept is becoming especially important in the conditions of a highly developed knowledge economy, when the sector of high-tech and intellectual activity occupies increasingly significant place in the modern economic system. It is possible to conduct medical activity as a frank exploitation of the patient and his suffering for own benefit, or it is possible to act as a socially responsible business, even in market conditions.

The Out-of-Network Consumer Protection, Transparency, Cost Containment, and Accountability Act has the potential to increase the social responsibility of healthcare providers in the US, albeit based on a “prohibitive” and “punitive” paradigm. Those health care providers who violate the provisions of this Act will not only be subject to penalties, but also will face a decrease in goodwill due to a decline in reputation in the medical services market. In particular, New Jersey Business & Industry Association (NJBIA) supported adoption of this Act because of increasing role which surprise out-of-network costs play in the growth of cost of healthcare for New Jersey employers, causing both higher premiums and out-of-pocket expenses.

SWOT Analysis of the Policy. Benefits and Disadvantages of the Policy

Below, the attempt is made to conduct SWOT analysis of the Act under consideration.

The Act under consideration creates a strong base aimed at protection of health services consumers from medical bills for out-of-network services in cases when they had no possibilities of selection. Similar legislation in other jurisdictions call them “surprise bills.” It is important that the Bulletin for the Act includes clarification that when a member receives services in the ‘multilevel’ network, the “inadvertent” provider should be paid. But, at the same time, financial liability of the patient is restricted to the corresponding amounts repayable as if the provider was in-network in the plan’s lowest cost level (Adler et al., 2019).

On the other hand, the Bulletin does not take into account quite possible cases in which a patient addresses in-network facility occupying a higher-cost level. Some providers at this higher-cost level hospital are fully out-of-network.

SWOT analysis clearly shows that the Act has both supporters and opponents. While individual employers and their associations advocate for the Act implementation, some healthcare facilities appear under a disadvantage, especially in case of highly specialized expensive services. Naturally, such healthcare facilities will constitute the side of the opponents to the Act, with potential of lobbying its cancellation.

The Policy Implications for Nursing Practice

The Act will affect nursing practice in all New Jersey care providers. In particular, the nurse will have to consult patients in the issues of determining the provider’s status, and advice regarding details of the potential financial consequences in case of using out-of-network service provider. Such advises evidently should be aimed at maximum reducing of the potential cost at preserving necessary amount and quality of services.

Measures to Improve the Policy

Measures are needed to address handling and arbitration procedures on hidden out-of-network claims. Also, comments from the wide public should be collected and processed in the process of the Act improvement. There is strong need of taking into account interests of all stakeholders, on the base of conducting proper stakeholder analysis and management.

Summary

Considering the fact that today the priorities on the agenda of healthcare organizations are issues such as financial sustainability, service models, patient centricity, digital transformation, and regulatory compliance, industry leaders planning to participate in shaping the future of healthcare and building a rational, stable ecosystem must collaborate with all interested parties. Out-of-Network Consumer Protection, Transparency, Cost Containment, and Accountability Act of New Jersey represents strong attempt of coordinating stakeholders’ interests. This is especially important in today quite turbulent environment in the healthcare market.

Moreover, the Act, although not yet in perfect shape, contributes to ‘reconciliation’ and combining deontology and Utilitarian ethics, striving to minimize the cost of medical services to the patient at simultaneous addressing financial interests of providers.

References

Adler, L., Fiedler, M., Ginsburg, P. B., Hall, M., Trish, E., Young, C. L., & Duffy, E. L. (2019). State approaches to mitigating surprise Out-of-Network billing. [White paper] Retrieved from Center for Health Policy at Brookings. Web.

Ahmadiani, S., & Nikfar, S. (2016). Challenges of access to medicine and the responsibility of pharmaceutical companies: A legal perspective. DARU Journal of Pharmaceutical Sciences, 24(13), 1-7.

Cooper, Z., & Scott Morton, F. (2016). Out-of-network emergency-physician bills – An unwelcome surprise. New England Journal of Medicine, 375(20), 1915-1918.

Fuse Brown, E.C. (2017). Consumer Financial Protection in Health Care. Washington University Law Review, 95(1), 127-201.

Out-of-Network consumer protections. (n.d.). Web.

Vogenberg, F. R., & Santilli, J. (2018). Healthcare trends for 2018. American Health & Drug Benefits, 11(1), 48-54.

Wacasey, K. (2016). The guide to buying health insurance, and health care [E-book]. Scotts Valley, CA: CreateSpace Independent Publishing Platform. Web.

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