HEALTH EDUCATION: NCM 102

CHAPTER 6:
FUTURE DIRECTIONS OF CLIENT EDUCATION
LEARNING OUCOMES:
§ To discuss wellness as the future direction of client education
§ To relate the importance of third-party reimbursement in today’s health education

HEALTH EDUCATION is a social science that aims to promote health and prevent
disease through voluntary behavioral change activities.

It is a combination of biological, environmental, psychological, intellectual, physical, and

medical aspects of health focused on helping individuals and communities through self-
enhancing skills and activities.

It is a well-known belief that health begins with oneself. Taking care of yourself is not up
to your parents, your family, and friends, nor your physician. The initiative for a healthy
life starts with you and you alone.

Health education motivates people to improve their state of being.

Its intention is to develop a sense of responsibility for oneself for their overall health as
members of a family unit and as members of a community.

The assessment of habits and attitudes of its people related to their awareness and
prevention of diseases.

A tool in improving the state of health of a nation. Health education helps reorganize and
guide people towards good lifestyle habits through health promoting practices and the
reduction of risky behaviors.

Health education teaches people and gives them the opportunity to take better care of
themselves. It helps them help others, whether it be their direct family or their community
as a whole.

Hospitals and other healthcare organizations have a long-standing commitment to patient

education. This process has usually occurred at the bedside, in clinic waiting rooms, or in
groups on the hospital premises.

1 Prepared By:
PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
Health Education Week is an annual program that falls every third week of October,
according to the calendar by the Department of Health.

The rising costs associated with illness and resulting overuse of the healthcare system
have resulted in increased interest on the public and healthcare providers to control
costs.

Today, more emphasis is given to health promotion, health maintenance, and disease
prevention.
The push for healthcare reform in this country has resulted in widespread efforts targeted
toward the concept of managed care.

CONCEPT OF MANAGED CARE

Managed care would mean the reallocation of healthcare money to selected groups who
will share the monies as well as the risks of keeping people healthy.
It also means the opportunity to contain costs and eliminate duplication or misuse of
tertiary healthcare services.

As a result of some economic concerns, the current trends in health care are directed
toward teaching individuals how to attain and maintain health.

ROLE OF THE NURSE:

Educate the consumer about avoiding health risks, reducing illness episodes, establishing
healthy environmental settings, and accessing health care services.

Those currently receiving medical assistance from low-income families in urban and rural
areas are the primary targets for these initial efforts at using public funds to support
managed care.

Managed care could yield positive outcomes if planning is careful and collaborative
between all concerned parties including the consumer.

Health educators need the participation of communities to promote health, eliminate

inconsistencies, and build healthy environments for all.

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
INCREASED THIRD PARTY REIMBURSEMENT

Financial Terminology
Educational services are not provided without a cost on human and material resources
thus, it is vital to know fiscal terminologies that directly affects both staff and patient
education.

EXPENDITURES
Direct Costs
• Tangible, expected expenditures, a substantial portion of which include personnel
salaries, employment benefits, and equipment (Gift, 1994).
• This portion of an organizational budget is the largest of the total budgetary outlay
of any healthcare facility.
• Nursing care delivery, because of its labor-intensive function, the costs of nurses’
salaries and benefits usually account for at least 50% if not more, of the total facility
budget.
• The higher the educational level of nursing staff, the higher the pays and benefits,
thus, the higher the total direct costs.
• Salary is used to buy an employee’s time and expertise but it’s not easy to tell how
long it will take to plan, implement, and evaluate various educational programs
being offered
• Example: If planning and doing patient or staff education exceeds the allotted
time, the nurse educator gets overtime pay. The extra cost may not have been
anticipated in the budget planning process.

• Time is also considered a direct cost and is a major factor included in a cost-
benefit analysis. If the time needed to prepare and offer patient or staff education
programs greater than the financial gain, the facility may seek other ways to
provide the service like compute programmed instruction or patient television
channel

• Equipment is classified as a direct cost. No organization can function without

proper equipment and the need to replace it when necessary.
• Teaching requires audio-visual equipment and tools for instruction. Overhead
projectors, slide projectors, models, copy machines, computers, and closed-circuit
televisions.
• Although renting or leasing equipment may sometimes be less expensive than
purchasing it, rental and leasing costs are still categorized as direct costs.

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
Direct costs are divided into two types:
1. FIXED
2. VARIABLE.

1. FIXED COSTS are those that are predictable, remain the same over time, and can be
controlled.
Examples:
§ Salaries,
§ Mortgages,
§ Loan repayments

2. VARIABLE COSTS are those costs that, in the case of healthcare organizations,
depend on volume.
Examples:
• The number of meals prepared depends on the patient census.
• The demand for patient teaching depends on the number and diagnostic types of
hospitalized patients.
• If demand or turnover of nursing staff increases, the number of orientation sessions
would also increase in volume.
• Supplies, a direct variable cost, change depending on the amount and type
needed.

Variable costs can become fixed costs when volume remains consistently high or low over
time.

INDIRECT COSTS are those costs not directly related to the actual delivery of an
educational program.

Examples:
a. Institutional overhead:
• Heating and air conditioning
• Lighting
• Space
b. Support services of maintenance
c. Housekeeping
d. Security

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
Such services are necessary and ongoing whether or not an educational session is in
progress.

HIDDEN COSTS, a type of indirect cost, can neither be anticipated nor accounted for
until after the fact. Organizational budgets are prepared on the basis of what is known
and predictable, with projections for variability in patient census included.

Personnel budgets are based on levels of staff needed to accommodate the expected
patient volume.
Calculated based on annual projection of patient days and how many patients an worker
can effectively care for on a daily basis.

• Low productivity of one or two personnel on a nursing unit can have a significant
impact on the workload of others, which leads to low morale and employee
turnover.

• Turnover increases recruitment and new employee orientation costs.

• In this respect, the costs are appropriately identified as hidden.

Difference Between Costs (Direct or Indirect) And Charges

o Direct and indirect costs are those expenses incurred by the facility.
o Charges are set by provider, but billed to the recipient of the services.

There may or may not be a balanced relationship between costs and charges.
Example:
If costs of raw materials are low, while charges for the items, goods, or services are high,
the retailer yields a profit.

In the healthcare arena, non-profit organizations are limited by law as to the amount they
can charge a client in relation to the actual cost of a service.

COST SAVINGS, COST BENEFIT, AND COST RECOVERY

Patient teaching is mandated by state laws, professional and institutional standards,

accrediting body protocols, and regulations for participation in Medicare and Medicaid
reimbursement programs.

5 Prepared By:
PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
Patient teaching is mandated by laws, professional and institutional standards,
accrediting body protocols, and regulations for participation in Medicare reimbursement
programs.

Hospitals get cost savings when patient lengths of stay are shortened or fall within the
allotted diagnostic related group (DRG) time frames. Patients who have fewer
complications and use less expensive services will yield a cost savings for the institution.

In ambulatory care setting (HMO), cost savings happen when patient education keeps
people healthy and independent for a longer period of time preventing high use of costly
diagnostic testing or in-patient services.

Patient education becomes more essential if a pattern of early discharge is identified

which results in frequent readmissions. The facility may be inspected by authorities and
be penalized. In this case, Cost savings becomes a moot point.

COST BENEFIT
Occurs when there is increased patient satisfaction with an institution as a result of the
services it renders such as educational programs.

EXAMPLE:
§ Childbirth classes
§ Weight and stress reduction sessions
§ Cardiac fitness and rehabilitation programs

Educational programs serve as an opportunity for an institution to capture a patient

population for life time coverage.
Patient satisfaction is critical to the individual’s return for future healthcare services.

COST RECOVERY
Results when either the patient or insurer pays a fee for educational services that are
provided. Cost recovery is realized by marketing of health education programs offered for
a fee.

Programs which are appropriate, vital parts in the performance of covered services which
are reasonable and necessary for the treatment of the individual’s illness or injury may be
reimbursed. (Kaiser Family Foundation, 2005).

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
The key to success in obtaining third-party reimbursement is the ability to demonstrate
that as a result of education, patients can manage self-care at home and consequently
experience fewer hospitalizations.

To take advantage of cost recovery, hospitals and other health care agencies develop and
market a cadre of health education programs that are open to all consumers in the
community.

“If it costs something, it must be worth something.” This mentality caused fee-for-service
programs to be well attended and result in revenues for the institution

The critical element is not only the recovery of costs but also revenue generation.
Revenue generation is the income realized over and above program costs, which can
also be regarded as profit.

Healthcare organizations have developed alternative strategies for patient education to

realize cost savings, cost benefit, cost recovery, or revenue generation.

Example:
A preoperative teaching program for surgical patients prior to admission to the hospital
has been found to lower patient anxiety, increase patient satisfaction, and decrease
nursing hours during hospitalization (Wasson & Anderson, 1993)

PROGRAM PLANNING AND IMPLEMENTATION

Key Elements For Patient Education Intended For Generation Of Revenue

1. Accurate assessment of direct costs such as:
• paper supplies
• Printing of program brochures
• Publicity
• Space, and time (based on an hourly rate) required of professional personnel to
prepare and offer the service.

RULE OF THUMB
If hourly rate is unknown, divide the annual base salary by 2080, the standard total
number of hours worked by most people in the course of 1 year.

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
If the program is to be offered on the premises of the facility, there may be no need to
plan f or a rental fee for space. However, indirect costs such as house keeping and
security should be prorated as a bona fide expense. Such a practice not only is good
fiscal management.

Fees for a program should be set at a level high enough to cover the aggregate costs of
program preparation and delivery.

COST SAVINGS: BREAKING EVEN

Provision of education classes for diabetics in the community to reduce the number of
costly hospital admissions.

PRICE = the calculated cost divided by the number of anticipated attendees.

Cost Benefit For The Institution:

Measures of Success:
§ Increased patient satisfaction (determined by questionnaires or evaluation forms)
§ Increase in the use of the sponsor’s services (determined by record keeping).

COST RECOVERY
The fee is set higher than the cost to produce profit in a series of classes for smoking
cessation or childbirth to improve the wellness of the community

Nurse educators give an annual report to administration of time and money spent and if
such expenses were profitable to the
institution in terms of cost savings, cost benefit, or cost recovery.

COST-BENEFIT ANALYSIS AND COST-EFFECTIVENESS ANALYSIS

Healthcare Organizations Education Department Major Responsibility:
§ For staff development,
§ For in-service employee training
§ For patient education programs that exceed the boundaries of bedside instruction.

A template for costing out programs that allows staff development sections to identify and
recoup their true costs while responding to increased market competition shifting towards
greater demand for cost accountability for educational programs.

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
COST-BENEFIT ANALYSIS - refers to measuring the relationship between costs and
outcomes. Outcomes can be the actual amount of revenue generated as a result of an
educational offering. They can be expressed in terms of shorter patient stays or reduced
hospitalizations for particular diagnostic groups of patients.

Under DRGs or capitation methods of reimbursement, if the facility makes a profit, this
can be expressed in monetary terms.

Program Is Considered To Be Of Cost Benefit:

If an educational program costs less than the revenue it generates:
§ Expense can be recovered by third-party reimbursement.
§ Savings are greater than costs to the facility.

The Cost-benefit Ratio

The measurement of costs against monetary gains.

COST-EFFECTIVENESS ANALYSIS
Refers to the impact an educational offering has on patient behavior.
If program objectives are achieved, as evidenced by positive and sustained changes in
behavior of the participants over time, the program is said to be cost effective.

Behavioral changes are highly desirable, in many instances they are less observable,
less tangible, and not easily measurable.
Example: reduction in patient anxiety cannot be converted into a gain in real money.

Therefore;
It is wise to analyze the outcome of teaching interventions by comparing behavioral
outcomes between two or more programs to identify the one that is most effective and
efficient when actual costs cannot be determined.

The nurse educator must attempt to interpret the costs of behavioral changes (outcomes)
to the institution by conducting a cost effectiveness analysis between programs.

HOW?
1. Identify and itemize all direct and indirect costs, including any identifiable hidden
costs.
2. Identify and itemize any benefits derived from the program offering, such as
revenue gained or decreased readmission rates that can be stated in monetary
values

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
Results of these findings can then be recorded on a grid so that each program’s cost
effectiveness is visually apparent

Non-vested Team Approach To An Analysis Of Program Effectiveness

§ Mitton and Donaldson (2004)
§ The purpose of determining the allocation or reallocation of valuable resources
between and among services or programs.
This approach ensures the integrity of the total process of program evaluation.

International Council Of Nurses (ICN) Position Statement In 2001

Obligates nurses to demonstrate their value in promoting cost effective quality care, by
playing a leadership role:
§ in program planning and evaluation
§ in policy setting
§ In interactive networking on:
- cost effectiveness research
- cost-saving strategies
- best practice standards

Economic Factors of Patient Education: Justice and Duty Revisited

In the interest of patient care, the client as a human being has a right to quality care
regardless of economic status, national origin, race, and the like.

Health professionals have a duty to see to it that such services are provided.
The healthcare organization has the right to expect that it will get its fair share of
reimbursable revenues for services rendered.

The nurse as an employee of the provider organization has a duty to carry out
organizational policies and mandates in an accountable and res possible manner.

This duty includes assuming fiscal accountability for patient education activities, whether
these are offered on an inpatient or ambulatory care basis or as service to the larger
community.

The principle of justice is a critical consideration within the discourse on patient education.

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PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)
The rapid changes and trends so evident in the contemporary health care arena are
mostly economically driven.

Organizations that provide health care are caught between the proverbial horns of the
dilemma of allocating scarce resources in a just yet economically feasible manner.

The realities of capitation and managed care result in shrinking revenues.

This trend, in turn, dictates shorter patient stays in hospitals and doing more with less.
Over and above the financial facts, these same charitable, not-for-profit organizations no
longer enjoy the legal immunity that existed in yesteryear.

Doctrine Of Respondeat Superior

Abernathy v. Sisters of St. Mary’s1969: The court held that a “non-governmental

charitable institution is liable for its own negligence and the negligence of its agents and
employees acting within the scope of their employment”.
(Strader, 1985, p. 364)

§The court further declared that this ruling would apply to all future cases as of
November 10, 1969.
§ Thus the regulated right of clients to health education carries a corresponding duty
of healthcare organizations to provide that service
The organization is challenged to ensure the competency of nursing staff to provide
educational services, and to do so in the most efficient and cost-effective manner possible
amidst the growing concerns.

It is an interesting dilemma when considering the fact that patient education is invariably
identified, directly or indirectly, as a legal responsibility of registered nurses in their
respective nurse practice acts.

Unfortunately, few pre-licensure education programs adequately prepare nursing

students for this critical function.

11 Prepared By:
PRIMROSE D. ABLUYEN, R.N.
(FOR IFSU USE ONLY)