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Finkelman, Leadership and Management for Nurses: Core Competencies for Quality
Care, 3rd edition.
1
Chapter 5: Healthcare Economics
LEARNING OUTCOMES AND SUGGESTED CLASSROOM AND CLINICAL
ACTIVITIES
LEARNING OUTCOME 1
Distinguish between the macrolevel and microlevel view of healthcare financial issues.
Suggestions and Strategies for Classroom Experience
• Discuss why nurses should know about the macro and micro perspectives of
healthcare finance. What do the students know about healthcare finance?
Suggestions and Strategies for Clinical Experience
• Ask nurses for examples of interaction of micro and macro functions they see in
their own facilities. Which seem to have the most impact on patients? Providers?
Administration?
LEARNING OUTCOME 2
Discuss critical issues related to current national healthcare expenditures.
Suggestions and Strategies for Classroom Experience
• Review information about healthcare expenditures. Search the Internet with
students to get updates on expenditures. Ask students to search for topics such as
Suggestions and Strategies for Clinical Experience
• Ask students if they have had patients who are having problems with
reimbursement. How did they know this? Would the nurse usually know this?
Who in the hospital would speak with the patient about payment issues? When
would this be done?
LEARNING OUTCOME 3
Analyze the role of the third-party payer.
Suggestions and Strategies for Classroom Experience
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Suggestions and Strategies for Clinical Experience
LEARNING OUTCOME 4
Explain how healthcare insurance is financed and by whom.
Suggestions and Strategies for Classroom Experience
• Use a debate to discuss the pros and cons of the prospective and retrospective
LEARNING OUTCOME 5
Discuss the importance of the various governmental benefit programs.
Suggestions and Strategies for Classroom Experience
• Using the Internet, search for information about the major governmental
programs. This can be done in class, or students can do this individually and bring
information to class. Ask students to consider how the programs impact nursing
care. Which programs have a broader impact, and which programs have a more
specific population impact?
LEARNING OUTCOME 6
Examine healthcare reimbursement changes found in the Affordable Care Act of 2010.
Suggestions and Strategies for Classroom Experience
LEARNING OUTCOME 7
Explain the service and reimbursement strategies used by insurers to control costs and
improve quality, and their association with managed care.
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Suggestions and Strategies for Classroom Experience
• Discuss the impact of the growth of primary care in the local community. How do
students view primary care from a personal health perspective (and/or with their
family)?
Suggestions and Strategies for Clinical Experience
• Ask a nurse manager to discuss with the students how utilization
review/management affects care on the unit. Students then should consider this
impact in relationship to their assigned patients.
• Students should find out about the formulary used in the healthcare organization.
How does it impact clinical decisions? Who developed the formulary? How is it
updated?
LEARNING OUTCOME 8
Analyze healthcare finances at the microlevel, including budgeting process, productivity,
cost containment, and impact on nursing.
Suggestions and Strategies for Classroom Experience
• Ask students to develop a personal budget for themselves, and to try and keep it
for a week. Afterwards ask them to critique their results.
• How do the students think the examples of cost containment methods would
affect the care they give?
Suggestions and Strategies for Clinical Experience
• Students can explore the budget’s impact on an individual unit and patient care by
asking staff, the team leader, and/or the nurse manager.
• Ask students to observe work done on a unit. What would they recommend to
improve productivity? How does the organization measure productivity, and what
is being done to improve productivity? What is the staff reaction to this effort?
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• What examples of cost-containment do they observe on the unit? What other
methods do they think might be helpful? Do they think an individual nurse can
make a difference in costs?
LEARNING OUTCOME 9
Examine the impact of reimbursement on nursing.
Suggestions and Strategies for Classroom Experience
• Ask students to make teams and discuss the meaning of universal healthcare
coverage, why the ACA does not provide this coverage and reason it was decided
Suggestions and Strategies for Clinical Experience
KEY CHAPTER CONCEPTS
3. Reimbursement affects patient care delivery, provider performance, patient outcomes,
4. Healthcare expenditures in the U.S. have been increasing, and compared with other
5. Problems that increase the cost of medical care and insurance include excessive
6. There is increasing concern for the uninsured, which include those persons with no
public or private coverage, or coverage that is not adequate for their needs.
7. Third-party payers have power to influence care and reimbursement. The payer pays or
8. There are three other key players in the healthcare environment; the customer, the
9. The process of reimbursement consists of (1) consumer uncertainty about health needs
and the need to share the financial risk if care is required; (2) the consumer joining a
10. Prospective vs. retrospective payment is an important concept that focuses on when
11. Methods for compensation for services can vary; examples are discounted fee-for-
12. Premium rate settings are usually calculated by amount per member per month and is
14. In order to reimburse enrollees for covered services the insurer considers consistency
15. The federal government is a major player in the healthcare arena, directly affecting
nursing care not only because of the likelihood of interaction with patients in these
16. See Box 5-2; ACA and reimbursement.
17. Medicare was established in 1965 as an amendment to the 1935 Social Security Act
18. The federal government and states administer Medicaid. The federal government
19. FEHBP is insurance provided to federal employees, retirees, and dependents. It is
21. States also provide insurance coverage for state employees.
22. HMOs are the first models of managed care. Enrollees go to one facility for both
23. Managed care has been changing due to pressure from consumers and increased
24. Just as service strategies are used to control costs and quality, reimbursement
25. Healthcare reform of 2010 restricts insurers discriminating for pre-existing
26. Covered healthcare services are services that the plan will cover or reimburse;
27. All nurses require a greater knowledge of reimbursement in order to understand how
28. To survive the changes in the future and develop new roles, nurses need to be active
participants in new delivery systems. How have nursing and nurses been affected by
reimbursement, and how can they affect reduction in costs? Examples are to manage
30. The budgetary micro-level process is long and cyclic. Budgets are composed of three
parts; salary and wages, operations, and capital (see Box 5-9).
32. The variance report is an important tool used in controlling costs.
33. Budgets serve multiple purposes: financial and statistical expression of organizational
34. Revenues and expenses are the two major budget categories. The projection of
revenues is based on such factors as number of patient days, treatments and procedures,
36. Assessing productivity can be done through a patient acuity or classification system,
37. Cost containment is another important consideration in the budgetary process and
must include an appreciation for the importance of quality. Decreasing costs that decrease
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38. Examples of some cost containment methods to increase nursing participation are
decreasing overtime, decreasing sick time, preventing costs for repair of equipment, using
supplies wisely, decreasing inventory of supplies, maintaining productivity standards,
preventing employee accidents, and improving staffing decisions.
APPLYING LEADERSHIP AND MANAGEMENT
BSN and Master’s Essentials: Application to Content
Chapter identifies which Essentials apply to the chapter content. This information is
primarily for the instructor, but students should understand the how these nursing
education standards apply to the chapter content and the nursing profession.
My Hospital Unit: An Evolving Case Experience
See the overview of the My Hospital Unit feature found in the front of the textbook.
Refer students to the specific My Hospital Unit scenario found in the chapter.
Applying AONE Competencies
The AONE competencies for nurse leaders are found in Appendix A. Ask students to
identify which of the AONE competencies apply to the content in the chapter.
Engaging in the Content: Critical Thinking and Clinical Reasoning and Judgment
See Discussion Questions and Application Exercises at the end of the chapter. Online
options are noted.
Chapter Features: Case Study and Applying Evidence-Based Practice
The Chapter Features: Case Study and Applying Evidence-Based Practice features may
be used in both classroom and online formats. The last two slides in the PPT slides
ADDITIONAL CASE
This case is not found in the textbook. It may be used for individual or team assignments:
written assignment and classroom or online team discussions. It may also be used as an
essay question for exams.
Case:
You are the nurse manager for the operating room, which includes pre-operative care,
care during surgery, and the post-anesthesia recovery unit (PACU). You are in the
process of developing the service budget for nursing, however, you know that developing
a budget in isolation is not effective.
Questions:
1. Who should you include in the discussions to develop a more effective budget
(stakeholders)?
2. What data do you need to develop an effective budget for the next year?
3. How should you engage the staff nurses in the process? (Provide specific strategies.)
4. What are key types of expenses that need to be in the budget?
5. How should you address cost containment?
