Chapter 7 Healthcare Organizations

 Vocab:
Advanced Practice Registered Nurses (APRN)- group of nurses, who have graduate
degrees and can perform nursing in an expanded nursing role
Accountable care organization- providers and healthcare organizations who agree to work
together for patients who receive Medicare
Accreditation- process in which authoritative body determines that an organization meets
certain standards to such a degree that the organization is able to meet the standards
as a whole and without ongoing monitoring of each aspect of performance
Consolidated systems- group of healthcare organizations that are united based on common
characteristics of ownership/regional location/mutual performance objectives
Deeming authority- power granted by one with power so that the recipient acts in his/her
place
Fee-for-service- system where patients have the option of consulting any healthcare provider
subject to reasonable requirements that may include utilization review and prior
approval for certain services but does not include a requirement to seek approval
through a gatekeeper
For-profit organization- organization that is operated to create excess income/profit for the
benefit of owners/stockholders
Horizontal integration- condition that results when 2+ organizations with similar services
come together
Managed care- care purchased through public/private healthcare organizations that may
have agreements with the organization for reimbursements.
Networks- resources of colleagues upon whom you can draw for advice; formal systems to
provide services
Preferred provider organization (PPOs)- contracts are devolved between hospitals and
physicians with discounted rates and prompt payment
Primary care- first access to care, usually a doctor seen every year for physicals
Private non-profit (or not-for-profit) organization that has funds redirected to
maintenance and growth rather than as dividends to stockholders
Public institution- providing health services under the support/direction of
local/state/federal government
Secondary care- disease restorative care
Tertiary care- rehabilitative/long-term care
Third-party payers- private and public agencies that contract with an individual to assume
responsibility to pay under defined conditions for specified healthcare services
Vertical integration- alignment of organizations to provide a full array or continuum of
services

 In Text:
 Institutional Providers
 Acute-care hospitals, long-term care facilities, rehab facilities are institutional
providers
 Characteristics are:
 Types of services provided
  General or special care
 Primary- entry into system, health maintenance, chronic care
 Secondary- prevention of disease complications
 Tertiary- rehabilitation/long term
 Length of direct care services provided
 Acute care = length of stay is <30 days
 Chronic care = length of stay >30 days
 Ownership
 Non-profit (voluntary)
 Serve people regardless of their ability to pay
 Exempt from paying taxes
 For-profit (proprietary)
 Financial assistance
 Third-party payers
 Higher hospital cost with lower wages
 Teaching status
 Offer better care due to access to state-of-the-art tech and researchers
 Can receive gov. reimbursement
 Accreditation status
 By Joint Commission and the National Committee for Quality
 Consolidated Systems
 Five levels (large national hospital companies, large voluntary affiliated systems,
regional hospital systems, metropolitan-based systems, special interest groups)
 Networks
 Public utilities, for-profit businesses, or loose alliances
 Ambulatory-based organ.
 HMOs, IPAs
 Community services
 Community services, including public health departments, are focused on the
treatment of the community rather than that of the individual
 Home Health
 Fastest growing segment in healthcare
 Long-term care (skilled nursing facilities)
 Hospice (palliative care)
 Focuses on confirming rather than denying the reality of death
 Nurse-Owned
 Self-Help
 Supportive
 Regulatory organizations
 Including centers for Medicare & Medicaid, US Food & Drug, Occupational
Health/Safety, US Equal Employment Opportunity, etc.
 3rd-Party Financing Organizations
 Integration
 Organizations can come together to form affiliations, consortiums, and consolidations
that result in multihospital systems and/or multi-organizational arrangements. When
organizations that provide similar services come together, the arrangement is referred
 to as horizontal integration. An example of horizontal integration is a group of acute
care facilities that come together to provide coverage for an expanded region. When
organizations align to provide a full array or continuum of services, the arrangement
is referred to as vertical integration
 Acquisitions/Mergers
 Acquisitions= one organization directly buying another
 Mergers= combining 2+ organizations and their assets to form a new entity
 Theoretical Perspective
 Systems Theory
 Systems can be either closed (self-contained) or open (interacting with both
internal and external forces). In systems theory, a system is described as
comprising four elements: structure, technology, people, and their environment.
Systems theorists focus on the interplay among these elements in a framework of
(1) inputs—resources such as people, money, or materials; (2) throughputs—the
processes that produce a product from the inputs; and (3) outputs—the product of
inputs and throughputs.
 Chaos Theory
 organizations must be self-organizing and adapt readily to change in order to
survive. Organizations, therefore, must accept that change is inevitable and
unrelenting. When one embraces the tenets of chaos theory, one gives up on any
attempt to create a permanent organizational structure. Using creativity and
flexibility, successful managers will be those who can tolerate ambiguity, take
risks, and experiment with new ideas in response to each day’s unique situation or
environment
 Tips
 Knowledge of economic, social, and demographic changes is essential to redesigning
healthcare organizations to meet society’s needs.
 Increasing consolidation of healthcare services that provide all levels of care
necessitates the development of communication systems that provide information on
patients receiving services at the various points of care in the network.
 Diversified positions will be available for professional nurses in the various
organizations that are developing to enhance the provision of care.
 New configurations of healthcare delivery will demand that professional nurses
continually acquire new knowledge and skills in leadership and management