A health care system is all the organizations, people, resources, and actions whose main purpose is to promote, restore, or maintain health. The WHO describes six building blocks: service delivery, health workforce, health information systems, access to essential medicines and technologies, financing, and leadership/governance.
Goals used to judge a system
| Goal | Meaning |
|---|
| Access | People can obtain needed care (financially, geographically, culturally) |
| Quality | Care is safe, effective, and improves outcomes |
| Cost / efficiency | Efficiency = results achieved relative to resources used; effectiveness = degree to which goals are achieved |
| Equity | Fair distribution of care and health according to need, not ability to pay |
Access, quality, and cost pull against each other ("iron triangle"): improving one often strains another.
Types of health systems (financing models)
| Model | Financing and delivery | Example |
|---|
| National health service (Beveridge) | Government finances care through general taxes and owns or employs most providers | United Kingdom NHS |
| Social insurance (Bismarck) | Mandatory insurance funded by employer and employee contributions; mostly private providers | Germany, Japan |
| National health insurance (single payer) | One public insurer funded by taxes; private delivery | Canada |
| Private / market (out-of-pocket) | Care purchased through private insurance or direct payment | Large parts of US private coverage |
The United States is a mixed (pluralistic) system: private employer-sponsored insurance, individual marketplace plans, and public programs (Medicare, Medicaid, CHIP, military and veterans' care, Indian Health Service), with mostly private delivery. Most other high-income countries provide universal coverage; the US does not, and some residents remain uninsured.
Levels of care
- Primary care — first-contact, comprehensive, continuous, coordinated care for most health needs (family practice, pediatrics, internal medicine, nurse practitioners, community health centers)
- Secondary care — specialist and community hospital care for more complex problems
- Tertiary care — highly specialized care (transplant centers, burn units, academic medical centers)
Primary health care (WHO Alma-Ata Declaration, 1978; renewed in Astana, 2018) is broader than primary care: essential, accessible, affordable, community-participation-based care plus action on the social determinants of health.
Major public programs
| Program | Who | Key features |
|---|
| Medicare (1965, federal) | People 65 and older, people with certain disabilities (generally after 24 months of Social Security disability benefits), end-stage renal disease, and ALS | Part A hospital, skilled nursing facility (short-term after a qualifying stay), home health, hospice; Part B physician, outpatient, preventive services, durable equipment; Part C Medicare Advantage (private plans that deliver A and B, often D); Part D outpatient prescription drugs. Does not cover long-term custodial care |
| Medicaid (1965, joint federal–state) | Low-income people meeting state rules; the ACA allowed states to expand to adults up to about 138% of the federal poverty level | Means-tested; states run programs within federal rules; largest payer for long-term nursing home care and a major payer for births |
| CHIP (1997) | Uninsured children in families with incomes too high for Medicaid | Joint federal–state |
| Veterans Health Administration, TRICARE, Indian Health Service | Veterans; military members and families; American Indians and Alaska Natives | Government-run or government-funded systems |
Affordable Care Act (ACA, 2010) — key provisions: insurance marketplaces with income-based premium tax credits; optional Medicaid expansion (made optional for states by the Supreme Court in 2012); coverage of preexisting conditions without higher premiums; young adults may stay on a parent's plan until age 26; preventive services recommended by the USPSTF (A and B grades) and ACIP-recommended vaccines covered without cost-sharing in most plans; essential health benefits; bans on lifetime dollar limits.
Recent changes to know
- The Inflation Reduction Act (2022) allowed Medicare to negotiate prices for selected drugs, capped insulin cost-sharing at $35 per month for Medicare enrollees, and placed an annual out-of-pocket cap on Part D costs ($2,000 in 2025, $2,100 in 2026); the first negotiated Medicare drug prices took effect January 1, 2026
- The 2025 budget reconciliation law (signed July 4, 2025) added Medicaid work (community engagement) requirements of 80 hours per month for most expansion adults aged 19–64, with exemptions (for example, parents or caretakers of children 13 or younger and people who are medically frail). States must apply them from January 1, 2027; states showing good-faith effort may receive extensions up to the end of 2028. Expansion adults also face eligibility redeterminations every 6 months for renewals after December 31, 2026. These changes are expected to reduce enrollment. Nurses should help clients keep coverage by reminding them of renewal deadlines and connecting them to enrollment assistance
How providers are paid
| Method | Description | Incentive |
|---|
| Fee-for-service | Payment for each service | More services; volume |
| Prospective payment / DRGs (Medicare inpatient since 1983) | Fixed amount per admission based on diagnosis-related group | Shorter stays, efficiency; risk of early discharge |
| Capitation | Fixed amount per enrolled person per month (managed care) | Prevention and cost control; risk of underuse |
| Bundled / episode payment | One payment for all care in an episode (e.g., joint replacement) | Coordination across settings |
| Value-based payment | Payment adjusted for quality and outcomes | Quality and safety |
| Accountable care organizations (ACOs) | Groups of providers share savings (or losses) for the total cost and quality of a population's care | Population health and coordination |
Social safety net concepts
- Social insurance — funded by contributions, earned entitlement, not means-tested (Social Security retirement, Medicare Part A, unemployment insurance, workers' compensation)
- Public assistance — funded by general taxes, means-tested (Medicaid, Supplemental Security Income, SNAP, TANF)
- Social services — nonmonetary support such as child protection, home-delivered meals, caregiving services
- Safety-net providers — Federally Qualified Health Centers (sliding-fee scale, serve all regardless of ability to pay), public hospitals, free clinics; EMTALA requires hospitals with emergency departments that accept Medicare to screen and stabilize anyone with an emergency condition regardless of ability to pay
The health policy process
- Problem identification
- Agenda setting — the problem gains government attention (Kingdon: a "policy window" opens when the problem, policy, and political streams converge)
- Policy formulation — alternatives are developed and analyzed (e.g., studying other states' programs, expert input)
- Policy adoption — a choice is made (law passed, regulation finalized)
- Implementation — agencies write regulations and run programs
- Evaluation — effects are measured; results lead to modification (reformulation) or termination
The process is cyclical: evaluation feeds new problem identification. Criteria for choosing alternatives include effectiveness, efficiency, equity, political feasibility, administrative feasibility, and cost.
Laws vs. regulations. Congress or a state legislature passes laws (statutes). Agencies (CMS, CDC, FDA, state health departments, boards of nursing) then issue regulations through rulemaking, usually with public comment published in the Federal Register or state register — a key point where nurses can influence policy.
- Screen clients for insurance status and eligibility; refer to Medicaid/CHIP enrollment, marketplace navigators, or FQHCs
- Plan discharge with coverage rules in mind: Medicare home health requires the client to be homebound and to need intermittent skilled care, with a face-to-face encounter documented; hospice requires a prognosis of 6 months or less if the illness runs its usual course
- Explain to families that Medicare does not pay for long-term custodial nursing home care; Medicaid may, once financial eligibility is met
- Use preventive benefits: most plans cover recommended screenings and vaccines without cost-sharing
- Document accurately; payment and quality measures depend on documentation (e.g., DRGs, present-on-admission status)
- Advocate for individual clients' access and for policies that improve population health
- Understand costs: use resources efficiently without compromising care
- Engage in policy: join professional organizations (ANA, state nurses associations), contact legislators, testify, comment on proposed regulations, serve on boards and coalitions
- Provide evidence: nurses' data and stories inform policymakers
- Coordinate care across levels to prevent gaps and readmissions
- EMTALA — screening and stabilization regardless of insurance; no delay to ask about payment
- Section 1557 of the ACA — prohibits discrimination in federally funded health programs
- Health care as a right vs. commodity — ethical debates about justice and allocation; the ANA Code of Ethics supports advocacy for health care access and social justice
- Fraud and abuse laws (False Claims Act, Anti-Kickback Statute) — billing for services not provided or documenting care not given is illegal
- Equity — policy choices affect vulnerable groups most; nurses consider distributive justice
Case 1 — Coverage gap. A 58-year-old client lost employer coverage. The nurse refers him to the marketplace and a community health center with a sliding-fee scale. Why: he is too young for Medicare; marketplace subsidies and FQHCs are the likely options.
Case 2 — Nursing home costs. The daughter of an 80-year-old client with dementia believes Medicare will pay for permanent nursing home care. The nurse explains that Medicare covers only short-term skilled care after a qualifying hospital stay; long-term custodial care is usually paid privately or by Medicaid if eligible. Why: this misconception is common and affects planning.
Case 3 — Policy stage. A state task force reviews other states' paid family leave laws and consults experts before proposing a bill. This is policy formulation. Why: alternatives are being developed and compared before adoption.
- Mixing up Medicare (age 65+, disability, ESRD; federal; social insurance) and Medicaid (low income; federal–state; means-tested)
- Believing the US has a single national system — it is mixed and does not guarantee universal coverage
- Confusing efficiency (results per resource) with effectiveness (goal achievement)
- Thinking DRGs pay for each day in hospital — they pay a fixed amount per admission
- Assuming the policy process ends with a law — implementation and evaluation follow, and the cycle repeats
- Confusing primary care (a level of medical care) with primary health care (a broad community-based strategy)
- US system: mixed/pluralistic; private insurance plus Medicare, Medicaid, CHIP, VA/TRICARE/IHS
- Medicare: 65+, certain disabilities, ESRD; Parts A, B, C, D; no long-term custodial care
- Medicaid: means-tested, federal–state; biggest payer for long-term care; ACA expansion optional for states
- ACA: marketplaces, preexisting condition protection, dependent coverage to 26, no-cost preventive services
- Payment: fee-for-service (volume), DRG (fixed per admission), capitation (per member per month), bundled, value-based, ACOs
- Social insurance (contributory) vs. public assistance (means-tested)
- EMTALA: screen and stabilize regardless of ability to pay
- Policy cycle: problem → agenda → formulation → adoption → implementation → evaluation → modification
- Beveridge = tax-funded national service; Bismarck = contribution-based social insurance; single payer = one public insurer
- Primary care attributes: first contact, comprehensive, continuous, coordinated