This document summarizes the key topics covered in Chapter 1 of the textbook "The Dynamic Environment of Health Care". It outlines 7 objectives of the chapter, then discusses 8 megatrends impacting healthcare like client characteristics, technology, and financing. It also reviews healthcare regulation at both the state and federal level. Additionally, it examines reimbursement models from fee-for-service to managed care and how the managed care era emphasized cost control. Mergers and affiliations between healthcare organizations are also summarized. Finally, it outlines the classic management functions and characteristics of effective healthcare managers.

1. THE DYNAMIC
ENVIRONMENT OF
HEALTH CARE
Chapter 1

2. Objectives
1. Describe the present healthcare environment.
2. Examine megatrends in the environment.
3. Address organizational survival.
4. Identify the role of the healthcare practitioner as
manager.
5. Review the classic functions of the manager.
6. Define and differentiate between management as an art
and a science.
7. Conceptualize the characteristics of an effective
manager.

3. Megatrends
1. Client characteristics
2. Professional practitioners and caregivers
3. The healthcare marketplace and settings
4. Applicable laws, regulations, and standards
5. The impact of technology
6. Privacy and security considerations
7. Financing of health care
8. Social and cultural factors

4. Healthcare Regulation
• State licensure laws for facilities
• State licensure laws for professions
• State-mandated healthcare planning
• State laws governing reimbursement and
insurance

5. Healthcare Regulation
• Federal laws governing reimbursement
• Federal laws regarding privacy and security of
information
• Patient Protection and Affordable Care Act
• American Recovery and Reinvestment Act

6. Reimbursement and Payment
• Charitable roots and the not-for-profit model
• Fee-for-service
• Health insurance: Non-profit and commercial
• Managed care
• Current legislation: Healthcare reform

7. The Managed Care Era
• Providing access to quality care at affordable
cost
• Primary care physician as “gatekeeper”
• Premium costs by limits on services
• Arrangements between managed care groups
and hospitals
• Issues about denial of service or payment

8. Capitation
• Reimbursement system under which provider
is paid specific amount of money to look after
all the healthcare needs of a given population
• Literally, reimbursement based on so much
“per head”

9. Reasons for Restructuring
• Desire to achieve greater negotiating clout
• Desire to penetrate new markets
• Need for improved efficiencies
• Desire to express an overall value of
promoting comprehensive, readily accessible
care

10. Mergers and Affiliations
• MERGER: Two or more corporate entities
blend to create one new organization
• AFFILIATION: Formal agreement between
facilities to coordinate and share activities
while remaining separate corporate entities

11. Range of Service
• Note the variety of services and levels of care
• Examples:
– Adult day care center
– Hospice
– Urgent care clinic

12. Impact of Technology
• “eVisits” and “digital doctors”
• Translational medicine
• Data warehousing
• Data mining
• “Real-time” interventions
• Common language and standards: Standard vocabulary
and classification systems
• National information infrastructure: To capture, access,
use, exchange, and store data

13. • Increased use by patients of alternative
therapies and interventions
• The embedded nurse representative on patient
care teams
• Rationing; quality-adjusted remaining years
Social and Ethical Factors

14. • Unit supervisor; project manager;
department head
• Specialized division head
• Manager of independent practice
Role of Healthcare Practitioner as
Manager

15. Management Functions
Typical management functions include:
• Planning
• Decision making
• Organizing
• Staffing
• Directing or actuating (motivating)
• Controlling

16. Effective Managers
Characteristics of effective managers include:
1. Knowledge of the internal structure and
characteristics of their organization
2. Knowledge of the internal and external
dynamics of their organization
3. Leading and motivating the workforce
4. Engaged in continuous search for excellence
5. Aware of and responsive to trends and
challenges