Health Care Cost and Quality Analysis


With the development of modern technology, specialists in the field of healthcare are expected to become able to improve the quality of health care without increasing costs. In the United States, the readiness to find appropriate resources to improve national health outcomes and avoid making healthcare less affordable is extremely important if the situation with income inequality is taken into account. Even though the existence of the direct link between healthcare costs and quality is still in question, many agencies attempt at developing initiatives that would help to accomplish the above goals simultaneously.

Addressing Cost and Quality: The Role of Public and Private Agencies

The activities performed by CMS, a public healthcare agency, include the development and implementation of new programs such as Shared Savings and helping different healthcare providers to unite their efforts to work with Medicare patients. In addition to that, the work performed by the agency helps reduce the number of healthcare organizations that fail to comply with official quality standards. Thus, the agency under consideration is allowed to conduct investigations in case of complaints concerning the quality of services received in some hospitals or other healthcare facilities.

Private agencies such as TJC are also highly involved in addressing the problem of costs and quality in healthcare. As for its general role in making the U.S. healthcare services more affordable and high-quality, TJC is known as an agency whose mission is to support healthcare providers’ attempts to improve the quality of services and accredit various hospitals if they comply with accepted standards. When speaking about the role that TJC plays in improving the quality-to-price ratio in healthcare, it is important to note that it offers a range of accreditation programs, each of which uses specific quality standards (The Joint Commission, n.d.). Among the key activities performed by the accrediting body is checking compliance with patient safety standards, which is directly related to the quality-cost problem being discussed.

TJC encourages healthcare organizations to pay more attention to client safety, which helps reduce the rates of medical errors and adverse events and, therefore, prevents additional costs. Both agencies contribute to improving patient outcomes by accrediting healthcare organizations with regard to the type of services provided. Even though the quality requirements implemented by the two agencies are quite similar, being a public agency, CMS has more decision-making power in the field. Thus, all quality standards currently used by TJC for accreditation and certification were approved by CMS.

Healthcare Initiatives and Implications

The United States is often referred to as the country with the most developed healthcare system even though the cost-quality problem has not been solved yet. However, there are numerous initiatives aimed at improving patient outcomes and controlling healthcare costs at the same time. Being among the leading healthcare agencies, CMS and TJC have proposed a range of initiatives and potential solutions to help solve the problem of costs and quality.

Among the brightest examples of such initiatives is the implementation of the P4P model helping to motivate healthcare providers to avoid medication mistakes and emphasize the quality of services instead of focusing on increasing the amount of care. There are many positive things about the discussed initiative since it helps reduce unnecessary care and, therefore, avoid extra spending. However, some aspects of the initiative can produce unintended outcomes. Thus, given that the model involves penalties for inadequate costs and unsatisfying patient outcomes, the implementation of P4P can encourage healthcare professionals to fake patient data or avoid working with serious patients (Werner, Konetzka, & Polsky, 2013). As a result, it can become a serious threat to patient equality and cause a range of ethical issues.

The creation of ACOs is another initiative that is currently used in the United States. It involves the establishment of entities (the groups of providers) that agree to share responsibility for the quality and costs of services that they provide (Centers for Medicaid & Medicare Services, 2018a). Despite having a lot of advantages, the members of ACOs are expected to have access to patient medical data, which can be incompatible with the physician-patient privilege. Additionally, more financial resources are required to optimize IT systems and coordinate the work of different organizations.

In terms of projected initiatives, it needs to be noted that CMS has announced a range of measures that can help ensure the integrity of Medicaid providers. Among them is the decision to conduct audits with regard to financial resources spent on quality improvement (Centers for Medicaid & Medicare Services, 2018b). In addition, the agency expresses the willingness to use new analytical tools to ensure the quality of Medicaid data. Given that the agency does not disclose specific details about these initiatives, it is not possible to predict its unwanted consequences with accuracy.

Another significant question is the implications of these initiatives for staff nurses and nurse practitioners. As for P4P initiatives, they impact all healthcare specialists since hospitals are required to create multidisciplinary teams to discuss potential pecuniary risks (Mattie & Webster, 2008). Such initiatives require nurses to perform more work to avoid errors, whereas their positive effect on service quality does not always meet expectations; however, the initiative increases the effectiveness of decubitus ulcer prevention strategies, which is better for both quality and costs (Werner et al., 2013). The establishment of ACOs requires nurse professionals to do their best in fulfilling such tasks as coordinating care, ensuring the use of evidence-based practice, and providing patient education concerning treatment options (Wright, 2017). If performed properly, these tasks help to fulfill the key role of ACOs, which is to provide high-quality care without offering unnecessary services to increase profits.


In the end, the need to improve the quality of healthcare services and prevent the growth of costs is still a pivotal task in the United States. Nowadays, the activity of CMS and TJC plays a significant role in addressing the issue of costs and quality in the field of healthcare. The initiatives that such organizations propose and implement affect all healthcare specialists, including nurses.


Centers for Medicaid & Medicare Services. (2018a). Accountable Care Organizations (ACOs). Web.

Centers for Medicaid & Medicare Services. (2018b). CMS announces initiatives to strengthen Medicaid program integrity. Web.

Mattie, A. S., & Webster, B. L. (2008). Centers for Medicare and Medicaid services’ “never events”: An analysis and recommendations to hospitals. The Health Care Manager, 27(4), 338-349.

The Joint Commission. (n.d.). Facts about the Joint Commission. Web.

Werner, R. M., Konetzka, R. T., & Polsky, D. (2013). The effect of Pay-for-Performance in nursing homes: Evidence from state Medicaid programs. Health Services Research, 48(4), 1393-1414.

Wright, W. L. (2017). New Hampshire nurse practitioners take the lead in forming an accountable care organization. Nursing Administration Quarterly, 41(1), 39-47.