HEALTH POLICY AND POLITICS
Nursing leadership: influencing and shaping health policy and nursing practice
The leadership discourse in the United Kingdom has to date been concerned with professional issues and as a result has focused upon developing nurses and nursing. This paper reports on the findings of a research study which examined the broader socio-political factors impacting upon nursing leadership. The study forms an integral part of the Royal College of Nursing's leadership programme. The principal aim of the research was to examine critically contemporary nursing leadership within the context of health policy. An ethnographic approach was used. Informal semi-structured interviews were undertaken with a purposive sample of 24 leaders who were recognized for their effectiveness in leading nursing. Data were analysed for themes. The main themes are presented and discussed here. The findings of the study question the political success which the internally focused nature of leadership has had for the profession. Nursing and therefore nursing leadership is shaped dramatically by the impact of politics and policy. The research discovered that in recognition of this, contemporary nursing leadership has both an internal and an external focus. That is, effective nursing leadership currently is a vehicle through which both nursing practice and health policy can be influenced and shaped. The research also identified the profile of the effective nurse leader, together with the processes through which leaders interpret and translate between the macro issues of policy and the micro issues of practice. In addition, an understanding of what nursing leadership is, has been proposed. Appropriate recommendations for the future of nursing and nursing leadership are outlined.
Purpose: To describe ways nurses are and are not effective in the development of health policy in the United States today, and to provide useful information for those interested in making nursing a more vital part of the policy arena.
Design: Qualitative examination of the career experiences and observations of a purposive sample of 27 American nurses currently active in health policy at the national, state, local, or organizational level.
Method: Semi-structured interviews regarding career path, contributing resources improvement of resources available to nurses, and the strengths and weaknesses of currently available information for policy work.
Findings: For nurse participants, policy involvement meant speaking for patients in arenas where those need of care have limited voice. Participation occured after assessment, diagnosis, and planning revealed the need for change in the way resources were allocated. Strong belief in the capacity and importance of people caring for themselves distinguished nurses in their policy roles. Policy makers responded to the experiences and determinants of health and illness as presented by nurses.
Conclusion: Once engaged, nurses seldom turned their backs on the world of policy-making. However, they did not report significant use of nursing research or information in policy making. Further investigation and testing of systems to connect nurse policymakers with nurse scholars are recommended.
A new conceptual model of nursing and health policy was designed to extend substantive knowledge of health policy within the discipline of nursing through policy analysis, policy or program evaluation, and disciplinary research that are conducted at five levels.
Level 1 focuses on the effectiveness of nursing practice processes on the health outcomes of individuals, families, groups, and communities.
Level 2 focuses on the efficiency of nursing practice delivery systems.
Level 3 focuses on the effectiveness and efficiency of a specific health care delivery system.
Level 4 focuses on equity of access to effective and efficient nursing practice processes and nursing practice delivery systems.
Level 5 focuses on social justice. The five levels interact with health policies and both constitute and are constituted by health policies. Of special interest are the health care services, personnel, and expenditures components of health policies formulated by geopolitical and governmental entities and institutions and organizations.
Canada's national health insurance system has also been subject to technological change and turmoil — strident debate over cost controls, the availability of medical technology, hospital closures, and the appropriate role of investor-owned providers. But its organizational structure has changed little. We evaluated whether the adoption of a more businesslike attitude, the proliferation of HMOs, and the automation of billing and clerical tasks have trimmed administrative costs in the United States and whether Canada's administrative parsimony has persisted in the years since our earlier study.
To estimate administrative costs, we sought data on insurance overhead, employers' costs to manage benefits, and the administrative costs of hospitals, practitioners' offices, nursing homes, and home care. Our estimates use 1999 figures, the most recent comprehensive data. We used gross-domestic-product purchasing-power parities to convert Canadian dollars to U.S. dollars, and we used SAS software for data analyses.
We obtained figures for insurance overhead and the administration of government programs from the Centers for Medicare and Medicaid Services8 and the Canadian Institute for Health Information.
For the United States, we used a published estimate of employers' spending for health care benefits consultants and internal administration related to health care benefits in 1996. We used this figure to estimate 1999 costs on the basis of the growth in health care spending among employers in the private sector. No comparable figures are available for Canada. We assumed that employers' internal administrative costs plus the costs of consultants (as a share of employers' health care spending) are the same in Canada as in the United States.
For the United States, we calculated the administrative share of hospital costs by analyzing data from fiscal year 1999 cost reports that 5220 hospitals had submitted to Medicare by September 30, 2001, using previously described methods. For Canada, we and colleagues at the Canadian Institute for Health Information analyzed cost data for fiscal year 1999 (April 1, 1999, through March 31, 2000) for all Canadian hospitals except those in Quebec (which use a separate cost-reporting system), using methods similar to the ones we used to calculate costs in the United States. When questions arose about the comparability of expense categories, we obtained detailed descriptions of the Canadian categories from Canadian officials and consulted U.S. Medicare auditors to ascertain where such costs would be entered on Medicare cost reports. For both countries, we multiplied the percentage spent on administrative costs by total hospital spending.
We calculated the administrative costs of U.S. physicians by adding the value of the physicians' own time devoted to administration to estimates of the share of several categories of office expenses that are attributable to administrative work. We determined the proportion of physicians' work hours devoted to billing and administration from a national survey and multiplied this proportion by physicians' net income before taxes. We calculated the costs of administrative work by nurses and other clinical employees in doctors' offices by assuming that they spent the same proportion of their time on administration as did physicians. We calculated the value of this time on the basis of total physicians' revenues and survey data on doctors' payroll costs from the American Medical Association.
We attributed all of physicians' expenses for clerical staff to administration. Although administrative and clerical workers accounted for 43.8 percent of the work force in physicians' offices (unpublished data), we attributed only one third of office rent and other expenses (excluding medical machinery and supplies) to administration and billing.
Accounting, legal fees (excluding the cost of malpractice insurance), the costs of outside billing services, and other such costs are subsumed in “other professional expenses,” half of which we attributed to administration.
To estimate the administrative expenses of dentists (and other nonphysician practitioners), we analyzed data on administrative and clerical employment in practitioners' offices from the March 2000 Current Population Survey using previously described methods. Administrative and clerical employees' share of office wages was 43 percent lower in the case of dentists' offices and 14 percent lower in the case of other nonphysician practitioners' offices than those of physicians' offices. We assumed that the administrative share of the income of dentists and other nonphysician practitioners mirrored these differences.
To calculate administrative costs in Canada, we obtained figures from a Canadian Medical Association survey on the proportion of physicians' time devoted to administration and practice management and multiplied this proportion by physicians' net income before taxes. To calculate the cost of nonphysician staff time, we used figures from Canadian Medical Association surveys of physicians' expenditures for office staff, which did not distinguish between clinical and administrative staff. We analyzed special 1996 Canadian Census tabulations to determine administrative and clinical workers' shares of total wages in doctors' offices. We attributed all of the administrative workers' share to administration and assumed that nonphysician clinical personnel spend the same proportion of their time on administration as did physicians.
To calculate the costs of office rent and similar expenses, we attributed one third of physicians' office rent, lease, mortgage, and equipment costs to administration and billing. We attributed half of other professional expenses to administration. To calculate the administrative expenses of nonphysician office-based practitioners in Canada, we used the same procedure that we used for the U.S. data and based the analysis on 1996 Canadian Census data.
No published nationwide data on the administrative costs of U.S. nursing homes are available for 1999, and only Medicare-certified facilities (which are not representative of all nursing homes) file Medicare cost reports. However, California collects cost data from all licensed homes. Therefore, we analyzed 1999 data on 1241 California nursing homes, grouping expenditures into three broad categories: administrative, clinical, and mixed administrative and clinical.
We used methods similar to those employed in our hospital analysis to allocate expenses from the “mixed” category to the clinical and administrative categories. To generate a national estimate, we multiplied the administrative share of expenditures by total nursing home spending.
For Canada, we and colleagues at the Canadian Institute for Health Information analyzed data for fiscal year 1998 (April 1, 1998, through March 31, 1999) on administrative costs for homes for the aged (excluding Quebec) from Statistics Canada's Residential Care Facilities Survey, using methods similar to those we used for the U.S. data. We multiplied the share spent for administration by total nursing home expenditures in Canada.
We analyzed data from fiscal year 1999 cost reports that 6633 home health care agencies submitted to Medicare. We excluded agencies reporting implausible administrative costs that were below 0 percent or above 100 percent and then calculated the proportion of expenses classified as “administrative and general.”
For Canada, we obtained data on administrative costs in Ontario; the categories used appeared similar to those used in the U.S. data.
We totaled the administrative costs of Community Care Access Centres, which contract with home care providers; home care providers (White G, Ontario Association of Community Care Access Centres: personal communication); and provincial government oversight of home care. We multiplied the proportion spent for administration by total home care spending throughout Canada.
To calculate total spending on health care administration, we totaled the administrative costs of all the categories detailed above. In analyzing the administrative share of health care spending, we excluded from both the numerator and the denominator expenditure categories for which data on administrative costs were unavailable: retail pharmacy sales, medical equipment and supplies, public health, construction, research, and “other,” a heterogeneous category that includes ambulances and in-plant services. These excluded categories accounted for $261.2 billion, 21.6 percent of U.S. health care expenditures, and $21.0 billion, 27.6 percent of Canadian health care expenditures.
How much administration is optimal? Does the high administrative spending in the United States relative to that in Canada (or to that in the United States 30 years ago) improve care? No studies have directly addressed these questions. Although indirect evidence is sparse, analyses of investor-owned HMOs and hospitals — subgroups of providers with relatively high administrative costs — have found that for-profit facilities have neither higher-quality care nor lower costs than not-for-profit facilities. Internationally, administrative expenditures show little relation to overall growth in costs or to life expectancy or other health indicators.
Several factors augment U.S. administrative costs. Private insurers, which have high overhead in most nations — 15.8 percent in Australia, 13.2 percent in Canada, 20.4 percent in Germany, and 10.4 percent in the Netherlands — have a larger role in the United States than in Canada. Functions essential to private insurance but absent in public programs, such as underwriting and marketing, account for about two thirds of private insurers' overhead.
A system with multiple insurers is also
intrinsically costlier than a single-payer system. For insurers it means
multiple duplicative claims-processing facilities and smaller insured groups,
both of which increase overhead. Fragmentation
also raises costs for providers who must deal with multiple insurance products
— at least
The existence of global budgets in Canada has eliminated most billing and minimized internal cost accounting, since charges do not need to be attributed to individual patients and insurers. Yet fragmentation itself cannot explain the upswing in administrative costs in the United States since 1969, when costs resembled those in Canada.
This growth coincided with the expansion of managed care and market-based competition, which fostered the adoption of complex accounting and auditing practices long standard in the business world.
Several caveats apply to our estimates. U.S. and Canadian hospitals, nursing homes, and home care agencies use different accounting categories, though we took pains to ensure that they were comparable. The U.S. hospital figure is consistent with findings from detailed studies of individual hospitals. The California data we used to estimate the administrative costs of U.S. nursing homes resulted in a lower figure (19.2 percent of revenues) than a published national estimate for 1998 (25.2 percent).
Our figures for physicians' administrative costs relied on self-reports of time and money spent. We had to estimate the time spent by other clinical personnel on administrative work and the share of office rent and expenses attributable to administration (together, these estimated categories account for 5 percent of total administrative costs in the United States). Physicians' reports and our estimates appear congruent with information from a time–motion study and Census data on clerical and administrative personnel employed in practitioners' offices. Our estimates of employers' costs to administer health care benefits rely on a consultant's survey of a limited number of U.S. firms. Though subject to error, this category accounts for only 5 percent of administrative costs in the United States.
Cross-national comparisons are complicated by differences in the range of services offered in hospitals and outpatient settings. For instance, many U.S. hospitals operate skilled-nursing facilities, whose costs are lumped with hospital costs in the national health accounts. Similarly, the costs of free-standing surgical centers, more common in the United States than in Canada, are lumped with practitioner costs. Although these differences shift administrative costs among categories (e.g., from nursing homes to hospitals), their effects on national totals should be small.
Price differences also affect international comparisons, a problem only partially addressed by our use of purchasing-power parities to convert Canadian dollars to U.S. dollars. (Using exchange rates instead would increase the difference between the United States and Canada by 27 percent.) Canadian wages are slightly lower than those in the United States, distorting some comparisons (e.g., per capita spending), but not others (e.g., the administrative share of health care spending or personnel).
Our dollar estimates understate overhead costs in both nations. They exclude the marketing costs of pharmaceutical firms, the value of patients' time spent on paperwork, and most of the costs of advertising by providers, health care industry profits, and lobbying and political contributions. Our analysis also omits the costs of collecting taxes to fund health care and the administrative overhead of such businesses as retail pharmacies and ambulance companies. Finally, we priced practitioners' administrative time using their net, rather than gross, hourly income, conservatively assuming that when physicians substitute clinical for administrative time, their overhead costs rise proportionally; using gross hourly income would boost our estimate of total administrative costs in the United States to $320.1 billion.
The employment figures used for our time-trend analysis exclude administrative employees in consulting firms, drug companies, and retail pharmacies, as well as insurance workers, who are far more numerous in the United States than in Canada. ).
Despite these imprecisions, the difference in the costs of health care administration between the United States and Canada is clearly large and growing. Is $294.3 billion annually for U.S. health care administration money well spent?
Supported by a grant (036617) from the Robert Wood Johnson Foundation.
Policy encompasses the choices that a society, segments of society, or organizations make regarding its goals and priorities and the ways it will allocate its resources. It reflects the values of those setting the policy. (5)
Nurses maintain values that promote individualized patient care and collaboration among health care professionals. (6) It is important that nurses are represented in the formation of health care policy and that these values, as well as nursing knowledge and expertise, are shared with politicians and reflected in quality health care legislation that is cost-effective. Nursing's active involvement in the molding of public policy through political commitment is a necessity; it is not enough to wait and see where legislation takes the profession and how changes in public policy will affect patients. If nurses do not become involved and employ a values-laden approach to politics, they have no power over their own future, and health care will suffer from their lack of participation.
Politics is viewed by most in a traditional manner, when in reality, politics involves many facets of everyday life, in addition to the legislative arena. The traditional approach to politics is reactive. Typically, people consider political action to be composed of lobbying, letter writing, voting, and other conventional means of influencing politicians and public policy initiatives. The nontraditional approach to politics is proactive. (7) One component of proactive politics is public education regarding such issues as
* preventive health care,
* staffing levels in hospitals,
* Medicare reimbursement issues, and
* the political structure of the health care system.
Nurses and the general public need to move past the assumption that traditional political approaches are the only way to influence public policy. Non-traditional approaches, such as professional practitioner visibility, membership on local school boards, and involvement in charitable organizations, are extremely effective methods of influencing public opinion regarding nursing's role at the community and national levels. (8)
When nurses rise to a level of political awareness, most tend to have a narrow political focus that centers on specific issues directly concerning the nursing profession (ie, staffing levels for nurses). (9) One author, however, states, "Politics affect virtually all levels of individual and community life." (10) Nurses need to incorporate this mentality into their political repertoire and address not only specific nursing issues but also major social issues that affect the general public and the nursing profession in an indirect manner. Most nurses are aware, to some extent, of legislation that involves health care reform and nursing practice. Nursing organizations are involved heavily in protecting or promoting these agendas and make an effort to inform their members and solicit their support.
Nurses and nursing organizations often ignore issues that affect public health on a national and international level because these issues do not directly involve their specialty. These issues include environmental protection and social problems (eg, unemployment, poverty), which are not always seen as direct contributors or detractors to public health. These issues most certainly involve the welfare and health of the public, and nurses have significant insight into how these issues will affect the world population. Nurses hold a level of stature that is highly respected and trusted. They are viewed as professionals who truly are interested in the welfare of others. The role of nurses in health promotion is recognized by international, national, and state organizations. (11) Organized support of these issues can greatly affect world health, so nurses have a duty to investigate their role and increase their level of participation. This type of empowerment broadens nursing's political focus and increases respect for the profession on all political levels.
POLITICAL KNOWLEDGE AND INFLUENCE
Nurses, as individuals, frequently do not address political issues that affect the profession. A lack of knowledge of the legislative process causes them to be overwhelmed by the complexity of public policy. Nurses focus on clinical care and sometimes ignore larger issues, partially due to a heavy workload, but also due to a lack of understanding of how to influence public policy. Governmental bodies influence or control many issues that affect nurses' clinical environment, such as
* nurse practice acts,
* reimbursement issues,
* resource allocation,
* Medicare reimbursement, and
* health care structure reform.
Yet nurses often do not see the relationship between their lack of political action and their inability to influence health care policy decisions, which in mm, affects their clinical environment. (12)
Public policy formation. There are four main steps in the process of public policy formation: setting an agenda, government response, policy design, and program implementation. (13) The first step is setting an agenda, which entails identifying and defining the problem to ascertain how much of the population might be affected by the problem. This affects the second step, which is determining the amount of government response that will be directed toward the issue. Setting an agenda and researching related issues provides a strong basis for government response if the agenda is well stated and supported properly. The third step occurs when a legislator produces and introduces a law, regulation, or program to address the problem. (14) Communication with legislators and committee members who are drafting the legislation is extremely important at this stage of the process. Nurses have the potential to largely affect health care legislation through their sheer numbers and expertise. (15) Communication at the policy design and implementation level is important because nursing expertise is necessary for the development of a practical program that meets the needs of the people it is designed to serve. (16) The final step in public policy formation is implementation of the program.
In addition to a basic comprehension of how legislation is enacted, nurses need to understand that many factors affect public policy development. The size of an issue can determine the timing of implementation (ie, how quickly change can be implemented). When a single issue that has minimal effect on other disciplines is introduced, marginal resistance can be expected; however, when something as large as health care reform is introduced, can be implemented only on an incremental basis. Legislation can become a partisan issue as well when one political party refuses to allow the legislation to be considered seriously; thus, change can be almost impossible. Another factor affecting public policy development is the effect of "pork barrel" politics, which is attaching numerous items of a piece of legislation, causing many legislators to object to an aspect of the legislation, thus, preventing it from becoming law.
The essence of public health, in the eyes of most researchers and practitioners, is a struggle to understand the causes and consequences of death, disease, and disability. Often an even greater struggle emerges when policy makers attempt to put that understanding to work, to translate knowledge into action for our collective well-being. Science can identify solutions to pressing public health problems, but only politics can turn most of those solutions into reality. Lindblom sets forth an important distinction: “When we say that policies are decided by analysis, we mean that an investigation of the merits of various possible actions has disclosed reasons for choosing one policy over others. When we say that politics rather than analysis determines policy, we mean that policy is set by the various ways in which people exert control, inﬂuence, or power over each other”.
Politics, for better or worse, plays a critical role in health affairs. Politics is central in determining how citizens and policy makers recognize and deﬁne problems with existing social conditions and policies, in facilitating certain kinds of public health interventions but not others, and in generating a variety of challenges in policy implementation. It is essential that public health professionals understand the political dimensions of problems and proposed solutions, whether they hold positions in government, advocacy groups, research organizations, or the health care industry. This understanding can help leaders to better anticipate both short-term constraints and long-term opportunities for change.
WHY HEALTH IS A POLITICAL ISSUE
Public health commonly involves governmental action to produce outcomes— injury and disease prevention or health promotion—that individuals are unlikely or unable to produce by themselves. Gostin argues, “A political community stresses a shared bond among members: organized society safeguards the common goods of health, welfare, and security, while members subordinate themselves to the welfare of the community as a whole. Public health can be achieved only through collective action, not through individual endeavor”.
Although this perspective is deeply ingrained in most public health students, researchers, and practitioners, it runs counter to a fundamental emphasis on property rights, economic individualism, and competition in American political culture. The exceptionalism of the United States lies in its antistatist beliefs: Americans are less concerned with what government will do to beneﬁt individuals than what government might do to control them. To the extent that Americans support collective action in the pursuit of public health or any other social good, they exhibit a strong preference for voluntary organization and participation.
Nonetheless, there are many reasons why the health of individuals and the general public is a political issue, not merely a private matter. First, individual and institutional actions often produce signiﬁcant spillover effects—what economists call externalities—some of which are beneﬁcial and some of which are harmful. To compensate for externalities associated with private actions such as smoking, vaccination, driving while intoxicated, sexual practices, and the manufacture and sale of products requires political decisions about when and how to impose restraints on individual liberties or commercial interests. In the eyes of John Stuart Mill, this would be the sole principle justifying public health policy: “The only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others. His own good, either physical or moral, is not sufﬁcient warrant”. A prominent expression came a century ago in the landmark Supreme Court case of Jacobson v. Massachusetts, validating the city of Cambridge’s program of compulsory vaccination against smallpox.
Second, citizens look to government to identify and satisfy a variety of physical, economic, and psychological needs that extend well beyond the means for survival. The public may support certain “merit goods” that should be distributed to intended beneﬁciaries whether or not they have an ability to pay for those goods. Such merit goods include elementary and secondary education, medical care for the poor and elderly, and food assistance and require political decisions to deﬁne their scope and substance, eligibility to receive them, and the source of revenues to purchase them or provide them directly.
Third, protecting public health involves moral judgments that acquire legitimacy through political debate and resolution. Kersh & Morone argue, “Despite myths about individualism and self-reliance, the U.S. government has a long tradition of regulating ostensibly private behavior”. The appropriateness of offering clean needles to injection drug users, funding stem cell research, supporting medical uses for marijuana, ensuring access to contraception and abortion, and legalizing physician-assisted suicide are among the moral issues that are hotly contested in the political arena.
Fourth, a healthy population and workforce is vital to economic growth and social order. Threats from AIDS or bioterrorism are not only public health problems but also, when they reach a certain scale, may become national security issues and thus a potential source of political instability.
These justiﬁcations for public action have produced a body of law and a politics of health that must balance “. . . the legal powers and duties of the state to assure the conditions for people to be healthy, and the limitations on the power of the state to constrain the autonomy, privacy, liberty, proprietary, or other legally protected interests of individuals for the protection or promotion of community health”.