HSA 3111 Lecture Notes - Lecture 6: Managed Care, Horizontal Integration, Joint Commission

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Two decades ago, a patient stayed in the hospital until the physician decided the patient was well enough to be discharged. Physicians generally tried to balance the interests of the patient with those of the hospital. The length of stay varied from one region of the country to another, even for those with the same condition. In the 1970s and early 1980s the cost of hospital care rose dramatically and insurance companies and large employers who provided insurance for their employees began to pressure federal agencies to address this issue. At that time hospitals were paid a set amount for each day the patient spent in the hospital. Hospitals had no incentive to keep costs down. In addition, unnecessarily long hospitalizations resulted in patients being exposed to more infections and diseases than if they were sent home. Long hospitalizations also result in decreased functioning, especially related to daily activities.

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