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Seventh Edition

Louise Simmers, MEd, RN

Karen Simmers-Nartker, BSN, RN
Sharon Simmers-Kobelak, BBA

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Diversified Health Occupations, Seventh © 2009 Delmar, Cengage Learning
ALL RIGHTS RESERVED. No part of this work covered by the copyright herein may be
Louise Simmers
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Karen Simmers-Nartker
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Sharon Simmers-Kobelak
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CHAPTER 2 Health Care

Chapter Objectives
After completing this chapter,
you should be able to:
Observe Standard
◆ Describe at least eight types of private health
care facilities
◆ Analyze at least three government agencies
Instructor’s Check—Call
Instructor at This Point
and the services offered by each
◆ Describe at least three services offered by
voluntary or nonprofit agencies
Safety—Proceed with
Caution ◆ Compare the basic principles of at least four
different health insurance plans
OBRA Requirement—Based ◆ Explain the purpose of organizational
on Federal Law structures in health care facilities
◆ Define, pronounce, and spell all key terms
Math Skill

Legal Responsibility

Science Skill

Career Information

Communications Skill


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Health Care Systems 27

Agency for Health Care home health care Occupational Safety and
Policy and Research hospice Health Administration
(AHCPR) hospitals (OSHA)
assisted living facilities independent living facilities optical centers
Centers for Disease Control industrial health care organizational structure
and Prevention (CDC) centers preferred provider
clinics laboratories organizations (PPOs)
dental offices long-term care facilities rehabilitation
emergency care services (LTCs or LTCFs) school health services
Food and Drug managed care TRICARE
Administration (FDA) Medicaid U.S. Department of Health
genetic counseling centers medical offices and Human Services
health departments Medicare (USDHHS)
health insurance plans Medigap voluntary agencies
Health Insurance Portability mental health Workers’ Compensation
and Accountability Act National Institutes of Health World Health Organization
health maintenance nonprofit agencies
organizations (HMOs)


Private Health Care Facilities Hospitals are one of the major types of health
Today, health care systems include the many care facilities. They vary in size and types of ser-
agencies, facilities, and personnel involved in the vice provided. Some hospitals are small and serve
delivery of health care. According to U.S. govern- the basic needs of a community; others are large,
ment statistics, health care is one of the largest complex centers offering a wide range of services
and fastest-growing industries in the United including diagnosis, treatment, education, and
States. This industry employs over 13 million research. Hospitals are also classified as private
workers in more than 200 different health careers. or proprietary (operated for profit), religious,
It attracts people with a wide range of educational nonprofit or voluntary, and government, depend-
backgrounds because it offers multiple career ing on the sources of income received by the
options. By the year 2012, employment is expected hospital.
to increase to over 15 million workers. Health care There are many different types of hospitals.
has become a 4-billion-dollar-per-day business. Some of the more common ones include:
Many different health care facilities provide
services that are a part of the industry called ♦ General hospitals: treat a wide range of condi-
health care (figure 2-1). Most private health care tions and age groups; usually provide diag-
facilities require a fee for services. In some cases, nostic, medical, surgical, and emergency care
grants and contributions help provide financial services
support for these facilities. A basic description of ♦ Specialty hospitals: provide care for special
the various facilities will help provide an under- conditions or age groups; examples include
standing of the many different types of services burn hospitals, oncology (cancer) hospitals,
included under the umbrella of the health care pediatric (or children’s) hospitals, psychiatric
industry. hospitals (dealing with mental diseases and

Copyright 2009 Cengage Learning, Inc. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part.

disorders), orthopedic hospitals (dealing with

bone, joint, or muscle disease), and rehabilita-
tive hospitals (offering services such as physi-
cal and occupational therapy)
♦ Government hospitals: operated by federal,
state, and local government agencies; include
the many facilities located throughout the
world that provide care for government ser-
vice personnel and their dependents; exam-
ples are Veterans Administration hospitals
(which provide care for veterans), state psy-
chiatric hospitals, and state rehabilitation
♦ University or college medical centers: provide
hospital services along with research and edu-
cation; can be funded by private and/or gov-
ernmental sources
In any type of hospital facility, a wide range of
trained health workers is needed at all levels.

Long-term care facilities (LTCs or LTCFs)
mainly provide assistance and care for elderly
patients, usually called residents. However, they
also provide care for individuals with disabilities
or handicaps and individuals with chronic or
long-term illness.
There are many different types of long-term
care facilities. Some of the more common ones
♦ Residential care facilities (nursing homes or
geriatric homes): designed to provide basic
physical and emotional care to individuals
who can no longer care for themselves; help
individuals with activities of daily living
(ADLs), provide a safe and secure environ-
ment, and promote opportunities for social
♦ Extended care facilities or skilled care facilities:
designed to provide skilled nursing care and
rehabilitative care to prepare patients* or resi-
dents for return to home environments or
other long-term care facilities; some have sub-
acute units designed to provide services to
FIGURE 2-1 Different health care facilities.
*In some health care facilities, patients are referred to
as clients. For the purposes of this text, patient will be

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Health Care Systems 29

patients who need rehabilitation to recover areas, major retail or department stores operate
from a major illness or surgery, treatment for dental clinics. Dental services can include gen-
cancer, or treatments such as dialysis for kid- eral care provided to all age groups or specialized
ney disease or heart monitoring care offered to certain age groups or for certain
♦ Independent living and assisted living dental conditions.
facilities: allow individuals who can care for
themselves to rent or purchase an apartment
in the facility; provide services such as meals, CLINICS OR SATELLITE
housekeeping, laundry, transportation, social
events, and basic medical care (such as assist-
ing with medications) Clinics, also called satellite clinics or satellite
Most assisted or independent living facilities centers, are health care facilities found in many
are associated with nursing homes, extended care types of health care. Some clinics are composed
facilities, and/or skilled care facilities. This allows of a group of medical or dental doctors who share
an individual to move readily from one level of a facility and other personnel. Other clinics are
care to the next when health needs change. Many operated by private groups who provide special
long-term care facilities also offer special services care. Examples include:
such as the delivery of meals to the homes of the ♦ Surgical clinics or surgicenters: perform minor
elderly, chronically ill, or people with disabilities. surgical procedures; frequently called “one-
Some facilities offer senior citizen or adult day day” surgical centers because patients are sent
care centers, which provide social activities and home immediately after they recover from
other services for the elderly. The need for long- their operation
term care facilities has increased dramatically
because of the large increase in the number of ♦ Urgent or emergency care clinics: provide first
elderly people. Many health career opportunities aid or emergency care to ill or injured patients
are available in these facilities, and there is a ♦ Rehabilitation clinics: offer physical, occupa-
shortage of nurses and other personnel. tional, speech, and other similar therapies
♦ Specialty clinics: provide care for specific dis-
eases; examples include diabetic clinics, kid-
MEDICAL OFFICES ney dialysis centers, and oncology (cancer)
Medical offices vary from offices that are pri-
♦ Outpatient clinics: usually operated by hospi-
vately owned by one doctor to large complexes
tals or large medical groups; provide care for
that operate as corporations and employ many
outpatients (patients who are not admitted to
doctors and other health care professionals. Medi-
the hospital)
cal services obtained in these facilities can include
diagnosis (determining the nature of an illness), ♦ Health department clinics: may offer clinics
treatment, examination, basic laboratory testing, for pediatric health care, treatment of sexually
minor surgery, and other similar care. Some medi- transmitted diseases and respiratory disease,
cal doctors treat a wide variety of illnesses and age immunizations, and other special services
groups, but others specialize in and handle only ♦ Medical center clinics: usually located in col-
certain age groups or conditions. Examples of spe- leges or universities; offer clinics for various
cialities include pediatrics (infants and children), health conditions; offer care and treatment
cardiology (diseases and disorders of the heart), and provide learning experiences for medical
and obstetrics (care of the pregnant female). students


Dental offices vary in size from offices that are Optical centers can be individually owned by an
privately owned by one or more dentists to dental ophthalmologist or optometrist or they can be
clinics that employ a group of dentists. In some part of a large chain of stores. They provide vision

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examinations, prescribe eyeglasses or contact

lenses, and check for the presence of eye diseases.

Emergency care services provide special care for
victims of accidents or sudden illness. Facilities
providing these services include ambulance ser-
vices, both private and governmental; rescue
squads, frequently operated by fire departments;
emergency care clinics and centers; emergency
departments operated by hospitals; and helicop-
ter or airplane emergency services that rapidly
transport patients to medical facilities for special

Laboratories are often a part of other facilities FIGURE 2-2 Many types of health care can be
but can operate as separate health care services. provided in a patient’s home.
Medical laboratories can perform special diag-
nostic tests such as blood or urine tests. Dental palliative care, or care that provides support and
laboratories can prepare dentures (false teeth) comfort, that is directed toward allowing the per-
and many other devices used to repair or replace son to die with dignity. Psychological, social, spir-
teeth. Medical and dental offices, small hospitals, itual, and financial counseling are provided for
clinics, and many other health care facilities fre- both the patient and the family. Hospice also pro-
quently use the services provided by laboratories. vides support to the family following a patient’s


Home health care agencies are designed to
provide care in a patient’s home (figure 2-2). The FACILITIES
services of these agencies are frequently used by
Mental health facilities treat patients with men-
the elderly and disabled. Examples of such ser-
tal disorders and diseases. Examples of these
vices include nursing care, personal care, therapy
facilities include guidance and counseling cen-
(physical, occupational, speech, respiratory), and
ters, psychiatric clinics and hospitals, chemical
homemaking (food preparation, cleaning, and
abuse treatment centers (dealing with alcohol
other household tasks). Health departments,
and drug abuse), and physical abuse treatment
hospitals, private agencies, government agen-
centers (dealing with child abuse, spousal abuse,
cies, and nonprofit or volunteer groups can offer
and geriatric [elderly] abuse).
home care services.


Hospice agencies provide care for terminally ill
persons who usually have life expectancies of 6 Genetic counseling centers can be an inde-
months or less. Care can be provided in the per- pendent facility or located in another facility such
son’s home or in a hospice facility. Hospice offers as a hospital, clinic, or physician’s office. Genetic

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Health Care Systems 31

counselors work with couples or individuals who for employees of the industry or business by per-
are pregnant or considering a pregnancy. They forming basic examinations, teaching accident
perform prenatal (before birth) screening tests, prevention and safety, and providing emergency
check for genetic abnormalities and birth defects, care.
explain the results of the tests, identify medical
options when a birth defect is present, and help
the individuals cope with the psychological issues
caused by a genetic disorder. Examples of genetic
disorders include Down’s syndrome and cystic SERVICES
fibrosis. Counselors frequently consult with cou-
ples prior to a pregnancy if the woman is in her School health services are found in schools
late childbearing years, has a family history of and colleges. These services provide emergency
genetic disease, or is of a specific race or nation- care for victims of accidents and sudden illness;
ality with a high risk for genetic disease. perform tests to check for health conditions such
as speech, vision, and hearing problems; pro-
mote health education; and maintain a safe and
REHABILITATION sanitary school environment. Many school health
services also provide counseling.
Rehabilitation facilities are located in hospi-
tals, clinics, and/or private centers. They provide
care to help patients with physical or mental dis- Government Agencies
abilities obtain maximum self-care and function.
Services may include physical, occupational, rec- In addition to the government health care facilities
reational, speech, and hearing therapy. mentioned previously, other health services are
offered at international, national, state, and local
levels. Government services are tax supported.
HEALTH MAINTENANCE Examples of government agencies include:
♦ World Health Organization (WHO): an
ORGANIZATIONS international agency sponsored by the United
Health maintenance organizations (HMOs) Nations; compiles statistics and information
are both health care delivery systems and types of on disease, publishes health information, and
health insurance. They provide total health care investigates and addresses serious health
directed toward preventive health care for a fee problems throughout the world
that is usually fixed and prepaid. Services include ♦ U.S. Department of Health and Human
examinations, basic medical services, health Services (USDHHS): a national agency that
education, and hospitalization or rehabilitation deals with the health problems in the United
services as needed. Some HMOs are operated by States
large industries or corporations; others are oper- ♦ National Institutes of Health (NIH): a divi-
ated by private agencies. They often use the ser- sion of the USDHHS; involved in research on
vices of other health care facilities including disease
medical and dental offices, hospitals, rehabilita-
tive centers, home health care agencies, clinics, ♦ Centers for Disease Control and Preven-
and laboratories. tion (CDC): another division of the USDHHS;
concerned with causes, spread, and control of
diseases in populations
INDUSTRIAL HEALTH ♦ Food and Drug Administration (FDA): a
CARE CENTERS federal agency responsible for regulating food
and drug products sold to the public
Industrial health care centers or occupa- ♦ Agency for Health Care Policy and
tional health clinics are found in large companies Research (AHCPR): a federal agency estab-
or industries. Such centers provide health care lished in 1990 to research the quality of health

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care delivery and identify the standards of Nonprofit agencies employ many health care
treatment that should be provided by health workers in addition to using volunteer workers to
care facilities provide services.
♦ Occupational Safety and Health Admin-
istration (OSHA): establishes and enforces
standards that protect workers from job-
related injuries and illnesses Health Insurance Plans
♦ Health departments: provide health ser- The cost of health care is a major concern of
vices as directed by the U.S. Department of everyone who needs health services. Statistics
Health and Human Services (USDHHS); also show that the cost of health care is more than 15
provide specific services needed by the state percent of the gross national product (the total
or local community; examples of services amount of money spent on all goods and ser-
include immunization for disease control, vices). Also, health care costs are increasing much
inspections for environmental health and faster than other costs of living. To pay for the
sanitation, communicable disease control, costs of health care, most people rely on health
collection of statistics and records related to insurance plans. Without insurance, the cost
health, health education, clinics for health of an illness can mean financial disaster for an
care and prevention, and other services individual or family.
needed in a community Health insurance plans are offered by several
thousand insurance agencies. A common exam-
ple is Blue Cross/Blue Shield (figure 2-3). In this
2:3 INFORMATION type of plan, a premium, or a fee the individual
pays for insurance coverage, is made to the insur-
Voluntary or Nonprofit Agencies ance company. When the insured individual
Voluntary agencies, frequently called non- incurs health care expenses covered by the insur-
profit agencies, are supported by donations, ance plan, the insurance company pays for the
membership fees, fund-raisers, and federal or services. The amount of payment and the type of
state grants. They provide health services at services covered vary from plan to plan. Com-
national, state, and local levels. mon insurance terms include:
Examples of nonprofit agencies include the ♦ Deductibles: amounts that must be paid by the
American Cancer Society, American Heart Asso- patient for medical services before the policy
ciation, American Respiratory Disease Associa- begins to pay
tion, American Diabetes Association, National
Mental Health Association, Alzheimer’s Associa- ♦ Co-insurance: requires that specific percent-
tion, National Kidney Foundation, Leukemia and ages of expenses are shared by the patient and
Lymphoma Society, National Foundation of the insurance company; for example, in an 80–20
March of Dimes, and American Red Cross. Many percent co-insurance, the company pays 80
of these organizations have national offices as
well as branch offices in states and/or local com-
As indicated by their names, many such orga-
nizations focus on one specific disease or group
of diseases. Each organization typically studies
the disease, provides funding to encourage
research directed at curing or treating the dis-
ease, and promotes public education regarding
information obtained through research. These
organizations also provide special services to vic-
tims of disease, such as purchasing medical
equipment and supplies, providing treatment FIGURE 2-3 Health insurance plans help pay for
centers, and supplying information regarding the costs of health care. (Courtesy of Empire Blue
other community agencies that offer assistance. Cross/Blue Shield)

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Health Care Systems 33

percent of covered expenses, and the patient Medicare is a federal government program
pays the remaining 20 percent that provides health care for almost all individu-
♦ Co-payment: a specific amount of money a als over the age of 65, for any person with a dis-
patient pays for a particular service, for exam- ability who has received Social Security benefits
ple, $10 for each physician visit regardless of for at least 2 years, and for any person with end-
the total cost of the visit stage renal (kidney) disease. Medicare consists of
three kinds of coverage: type A for hospital insur-
ance, type B for medical insurance, and type D
Many individuals have insurance coverage for pharmaceutical (medication) expenses. Type
through their places of employment (called A covers hospital services, care provided by an
employer-sponsored health insurance or group extended care facility or home-health care agency
insurance), where the premiums are paid by the after hospitalization, and hospice care for people
employer. In most cases, the individual also pays with a terminal illness. Type B offers additional
a percentage of the premium. Private policies are coverage for doctors’ services, outpatient treat-
also available for purchase by individuals. ments, therapy, clinical laboratory services, and
A health maintenance organization (HMO) is other health care. The individual does pay a pre-
another type of health insurance plan that pro- mium for type B coverage and also must pay an
vides a managed care plan for the delivery of initial deductible for services. In addition, Medi-
health care services. A monthly fee or premium is care pays for only 80 percent of the services; the
paid for membership, and the fee stays the same individual must either pay the balance or have
regardless of the amount of health care used. The another insurance policy to cover the expenses.
premium can be paid by an employer and/or an Medigap policies are health insurance plans
individual. Total care provided is directed toward that help pay expenses not covered by Medicare.
preventive type health care. An individual insured These policies are offered by private insurance
under this type of plan has ready access to health companies and require the payment of a pre-
examinations and early treatment and detection mium by the enrollee. Medigap policies must
of disease. Because most other types of insurance meet specific federal guidelines. They provide
plans do not cover routine examinations and pre- options that allow enrollees to choose how much
ventive care, the individual insured by an HMO coverage they want to purchase.
can therefore theoretically maintain a better state Medicaid is a medical assistance program
of health. The disadvantage of an HMO is that the that is jointly funded by the federal government
insured is required to use only HMO-affiliated and state governments but operated by individ-
health care providers (doctors, laboratories, hos- ual states. Benefits and individuals covered under
pitals) for health care. If a nonaffiliated health this program vary slightly from state to state
care provider is used instead, the insured usually because each state has the right to establish its
must pay for the care. own eligibility standards, determine the type and
A preferred provider organization scope of services, set the rate of payment for ser-
(PPO) is another type of managed care health vices, and administer its own program. In most
insurance plan usually provided by large indus- states, Medicaid pays for the health care of indi-
tries or companies to their employees. The PPO viduals with low incomes, children who qualify
forms a contract with certain health care agen- for public assistance, and individuals who are
cies, such as a large hospital and/or specific doc- physically disabled or blind. Generally, all state
tors and dentists, to provide certain types of Medicaid programs provide hospital services,
health care at reduced rates. Employees are physician’s care, long-term care services, and
restricted to using the specific hospital and/or some therapies. In some states, Medicaid offers
doctors, but the industry or company using the dental care, eye care, and other specialized ser-
PPO can provide health care at lower rates. PPOs vices.
usually require a deductible and a co-payment. If The State Children’s Health Insurance Pro-
an enrollee uses a nonaffiliated provider, the PPO gram (SCHIP) was established in 1997 to provide
may require co-payments of 40–60 percent. health care to uninsured children of working
The government also provides health insur- families who earn too little to afford private insur-
ance plans for certain groups of people. Two of ance but too much to be eligible for Medicaid. It
the main plans are Medicare and Medicaid. provides inpatient and outpatient hospital ser-

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vices, physician’s surgical and medical care, labo- ance increases, many employers are less willing
ratory and X-ray tests, and well-baby and to offer health care insurance. Individuals with
well-child care, including immunizations. chronic illnesses often find they cannot obtain
Workers’ Compensation is a health insur- insurance coverage if their place of employment
ance plan providing treatment for workers injured changes. This is one reason the federal govern-
on the job. It is administered by the state, and ment passed the Health Insurance Portabil-
payments are made by employers and the state. ity and Accountability Act (HIPAA) in 1996.
In addition to providing payment for needed This act has five main components:
health care, this plan also reimburses the worker
♦ Health Care Access, Portability, and Renew-
for wages lost because of on-the-job injury.
ability: limits exclusions on preexisting condi-
TRICARE, formerly called CHAMPUS (the
tions to allow for the continuance of insurance
Civilian Health and Medical Programs for the
even with job changes, prohibits discrimina-
Uniform Services) is a U.S. government health
tion against an enrollee or beneficiary based
insurance plan for all military personnel. It pro-
on health status, guarantees renewability in
vides care for all active duty members and their
multiemployer plans, and provides special
families, survivors of military personnel, and
enrollment rights for individuals who lose
retired members of the Armed Forces. The Veter-
insurance coverage in certain situations such
ans Administration provides for military veter-
as divorce or termination of employment
Managed care is an approach that has ♦ Preventing Health Care Fraud and Abuse;
developed in response to rising health care costs. Administrative Simplification, and Medical
Employers, as well as insurance companies who Liability Reform: establishes methods for pre-
pay large medical bills, want to ensure that such venting fraud and abuse and imposes sanc-
money is spent efficiently rather than wastefully. tions or penalties if fraud or abuse does occur,
The principle behind managed care is that all reduces the costs and administration of health
health care provided to a patient must have a care by adopting a single set of electronic
purpose. A second opinion or verification of need standards to replace the wide variety of for-
is frequently required before care can be pro- mats used in health care, provides strict guide-
vided. Every effort is made to provide preventive lines for maintaining the confidentiality of
care and early diagnosis of disease to avoid the health care information and the security of
high cost of treating disease. For example, rou- health care records, and recommends limits
tine physical examinations, well-baby care, for medical liability
immunizations, and wellness education to pro- ♦ Tax-Related Health Provisions: promotes the
mote good nutrition, exercise, weight control, use of medical savings accounts (MSAs) by
and healthy living practices are usually provided allowing tax deductions for monies placed in
under managed care. Employers and insurance the accounts, establishes standards for long-
companies create a network of doctors, special- term care insurance, allows for the creation of
ists, therapists, and health care facilities that pro- state insurance pools, and provides tax bene-
vide care at the most reasonable cost. HMOs and fits for some health care expenses
PPOs are the main providers of managed care, ♦ Application and Enforcement of Group Health
but many private insurance companies are estab- Plan Requirements: establishes standards that
lishing health care networks to provide care to require group health care plans to offer porta-
their subscribers. As these health care networks bility, access, and renewability to all members
compete for the consumer dollar, they are of the group
required to provide quality care at the lowest pos-
sible cost. The health care consumer who is
♦ Revenue Offsets: provides changes to the Inter-
nal Revenue Code for HIPAA expenses
enrolled in a managed care plan receives quality
care at the most reasonable cost but is restricted Compliance with all HIPAA regulations was
in choice of health care providers. required by April 2004 for all health care agencies.
Health insurance plans do not solve all the These regulations have not solved all of the prob-
problems of health care costs, but they do help lems of health care insurance, but they have pro-
many people by paying for all or part of the cost vided consumers with more access to insurance
of health services. However, as the cost of insur- and greater confidentiality in regard to medical

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Health Care Systems 35

records. In addition, standardization of electronic A sample organizational chart for a large gen-
health care records, reductions in administrative eral hospital is shown in figure 2-4. This chart
costs, increased tax benefits, and decreasing shows organization by department. Each depart-
fraud and abuse in health care have reduced ment, in turn, can have an organizational chart
health care costs for everyone. similar to the one shown for the nursing depart-
ment in figure 2-4. A sample organizational chart
for a small medical office is shown in figure 2-5.
2:5 INFORMATION The organizational structure will vary with the size
of the office and the number of people employed.
Organizational Structure In both organizational charts illustrated, the
All health care facilities must have some type of lines of authority are clearly indicated. It is impor-
organizational structure. The structure may tant for health care workers to identify and under-
be complex, as in larger facilities, or simple, as in stand their respective positions in a given facility’s
smaller facilities. Organizational structure always, organizational structure. By doing this, they will
however, encompasses a line of authority or chain know their lines of authority and understand who
of command. The organizational structure should are the immediate supervisors in charge of their
indicate areas of responsibility and lead to the work. Health care workers must always take ques-
most efficient operation of the facility. tions, reports, and problems to their immediate

Hospital Board

Medical Staff

Hospital Director

Maintenance Central Business

Housekeeping Supply Office Pharmacy Dietary Nursing Laboratory Radiology Therapy Volunteers

Public Medical Social

Administration Personnel Relations Accounts Records Services Physical Occupational Recreational

(Vice President)
of Nurses

Nursing Surgery Inpatient Care Emergency Clinics

Education Room

Nursing Supervisors

Head or Charge
(Unit Managers)

Patient Care Ward Clerks

Technicians L.P.N.’s R.N.’s or Volunteers
(PCTs) L.V.N.’s Unit Coordinators

FIGURE 2-4 A sample hospital organizational chart.

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Assistant R.N.’s Maintenance Business Dept.
(Receptionist) Housekeeping Insurance

L.P.N.’s Medical
L.V.N.’s Assistants

FIGURE 2-5 A sample medical office organizational chart.


Nature as a pharmacy?
Throughout history, many medicines have been derived from natural resources. Exam-
ples include aspirin, which comes from willow bark; penicillin, which comes from fungus;
and the cancer drug Taxol, which comes from the Pacific yew tree. Recognizing this, many
scientists believe that nature is a pharmaceutical gold mine and are exploring the vast sup-
ply of materials present in the oceans and in the earth.
The National Cancer Institute (NCI) has more than 100,000 samples of plants and marine
life stored in Frederick, Maryland. Every sample is crushed into a powder and made into
extracts that can be tested against human cancer cells. In addition, small quantities of the
extracts are made available to other scientists who evaluate their effectiveness against other
conditions, such as viral diseases and infections. To date, more than 4,000 extracts have
shown promise and are being used in more advanced studies. One compound, Halichon-
drin B, labeled “yellow slimy” by researchers, appears to be effective at eliminating human
tumors. Halichondrin B is an extract taken from a deep-sea sponge found in New Zealand.
Scientists have created a synthetic version of the active component in Halichondrin B. This
component, called E7389, is currently being tested in patients with a variety of tumors. By
creating synthetic versions of the compounds, scientists are preserving natural resources
while also benefiting from them.
Other natural products are now being tested and modified. Bristol-Myers is testing Ixa-
bepilone, extracted from garden soil bacteria, in patients with advanced breast cancer.
Wyeth isolated Rapamune from soil on Easter Island and proved it is effective in preventing
kidney rejection after transplants. NCI developed a compound called prostratin from tree
bark in Samoa. Healers in Samoa used the bark to treat hepatitis. The NCI has found that it
is effective against the human immunodeficiency virus (HIV) that causes acquired immune
deficiency syndrome (AIDS). As scientists continue to explore all that nature has to offer, it
is possible they will find cures for many cancers, diseases, and infections.

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Health Care Systems 37

supervisors, who are responsible for providing tutes of Health, Centers for Disease Control
necessary assistance. If immediate supervisors and Prevention, Food and Drug Administra-
cannot answer the question or solve the problem, tion, and Occupational Safety and Health
it is their responsibility to take the situation to the Administration.
next level in the organizational chart. It is also 3. Voluntary or nonprofit agencies: search for
important for health care workers to understand information on the purposes and activities of
the functions and goals of the organization. organizations such as the American Cancer
Society, American Heart Association, American
STUDENT: Go to the workbook and complete Respiratory Disease Association, American
the assignment sheet for Chapter 2, Health Care Diabetes Association, National Mental Health
Systems. Association, National Foundation of the March
of Dimes, and the American Red Cross.
4. Health insurance: search the Internet to find
CHAPTER 2 SUMMARY specific names of companies that are health
maintenance organizations or preferred
provider organizations. Check to see how their
Health care, one of the largest and fastest grow-
coverage for individuals is the same or how it is
ing industries in the United States, encompasses
many different types of facilities that provide
health-related services. These include hospitals, 5. Government health care insurance: search the
long-term care facilities, medical and dental of- Internet to learn about benefits provided
fices, clinics, laboratories, industrial and school under Medicare, Medicaid, and the State
health services, and many others. Government Children’s Health Insurance Program.
and nonprofit or voluntary agencies also pro-
vide health care services. All health care facili-
ties require different health care workers at all REVIEW QUESTIONS
levels of training.
Many types of health insurance plans are 1. Differentiate between a private or proprietary,
available to help pay the costs of health care. religious, nonprofit or voluntary, and govern-
Insurance does not usually cover the entire cost ment type of hospital.
of care, however. It is important for consumers 2. Identify at least six (6) different types of private
to be aware of the types of coverage provided by health care facilities by stating the functions of
their respective insurance plans. the facility. Provide specific examples of the
Organizational structure is important in all care received at each facility.
health care facilities. The structure can be com-
plex or simple, but it should show a line of au- 3. Name each of the following federal agencies
thority or chain of command within the facility and briefly describe its function:
and indicate areas of responsibility. a. CDC
b. FDA
c. NIH
Use the suggested search engines in Chapter 12:4 f. WHO
of this textbook to search the Internet for addi- 4. What does the term deductible mean on health
tional information on the following topics: insurance policies? co-insurance? co-payment?
1. Private health care facilities: search for infor- premium?
mation on each of the specific types of facili- 5. An insurance policy has a co-payment of 70–30
ties; for example, hospitals, hospice care, or percent. If an emergency department bill is
emergency care services. $660.00, what amount will the patient have to
2. Government agencies: search for more detailed pay?
information about the activities of the World 6. Why is it important for every health care
Health Organization, U.S. Department of worker to know the organizational structure for
Health and Human Services, National Insti- his/her place of employment?

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