# Healthcare Lexicon Map of the controlled vocabulary for the U.S. healthcare system in this vault. The vocabulary maps the uniquely American system where pharmaceutical pricing, insurance mechanics, and hospital ownership structures create a landscape of intentional complexity that obscures who profits and who pays. Terms live in `/Terminology/Healthcare/`; the analytical hub is [[Healthcare Industry Ecosystem]]. ## Hospital Ownership Models Who owns the institutions that deliver care — and how ownership shapes outcomes. - [[Nonprofit Hospital]] — Tax-exempt; largest category (~58%). The designation increasingly strained as major nonprofit systems accumulate billions in reserves while providing minimal charity care. - [[For-Profit Hospital]] — Investor-owned; ~24%. Associated with higher costs, lower staffing ratios, and worse patient outcomes compared to nonprofit peers. - [[Government Hospital]] — Publicly owned (VA, county, municipal); ~18%. Serves as the safety net; chronically underfunded and politically vulnerable. - [[Safety-Net Hospital]] — High uninsured/Medicaid load. The institutions that bear the cost of America's coverage gaps. - [[Private Equity Hospital Rollup]] — The most financialized variant. PE firms acquire and consolidate hospitals, cutting staff and services to extract returns; linked to increased patient mortality and the hollowing out of rural healthcare. ## Payer-Side Vocabulary How the system decides who gets care and how much they pay. - [[Managed Care]] — The dominant insurance model that controls costs by restricting provider networks, requiring referrals, and using prior authorization; the system that replaced fee-for-service but created its own perverse incentives. - [[Medicare Advantage]] — Privatized Medicare. - [[Prior Authorization]] — The requirement that insurers approve treatments before they're delivered; the bureaucratic mechanism that delays and denies care, estimated to cost the healthcare system $35 billion annually in administrative overhead. - [[Claim Denial]] — When an insurer refuses to pay for a service; the UnitedHealthcare CEO assassination brought public attention to systematic denial as a business model. - [[Upcoding]] — Billing for a more expensive procedure or diagnosis than what was actually provided; the fraud mechanism that inflates healthcare costs and is particularly prevalent in private equity-owned practices. ## Drug-Pricing Vocabulary The mechanisms that determine what drugs cost and who can get them. - [[Drug Pricing]] — The money-flow spine (manufacturer to PBM to patient). - [[Drug Price Negotiation]] — The power (finally granted by the Inflation Reduction Act in 2022) for Medicare to negotiate prices directly with pharmaceutical companies via Maximum Fair Price; the policy the pharma lobby spent decades and billions preventing. - [[List Price]] — The manufacturer's sticker price (WAC) before rebates, discounts, and negotiations; the deliberately inflated number that determines out-of-pocket costs for uninsured patients. - [[Drug Rebate]] — Manufacturer discount for formulary placement. Sounds like a discount but functions as a kickback that inflates list prices while keeping the savings from patients (the rebate trap). - [[Spread Pricing]] — The PBM practice of charging insurers more for a drug than they pay the pharmacy, pocketing the difference; the hidden margin that PBM middlemen extract from the system. - [[Formulary]] — The list of drugs an insurance plan covers and at what tier of cost-sharing; the gatekeeper mechanism that determines whether patients can afford their prescribed medications. - [[340B Drug Pricing Program]] — Federal program requiring drug manufacturers to sell at steep discounts to safety-net providers; increasingly exploited by large hospital systems that profit from the spread between discount acquisition cost and full-price billing. - [[Patent Evergreening]] — The pharmaceutical strategy of making minor modifications to existing drugs to extend patent protection and prevent generic competition; the legal mechanism that keeps drug prices artificially high. - [[Pay-for-Delay]] — Agreements where brand-name drug makers pay generic manufacturers to delay entering the market; the antitrust violation that the FTC estimates costs consumers $3.5 billion annually. - [[Biosimilar]] — The generic-equivalent of biologic drugs (proteins, antibodies); cheaper alternatives whose adoption is systematically slowed by patent thickets and rebate structures that favor brand-name products. - [[Medicare Part D]] — The prescription drug benefit added to Medicare in 2003; designed by the pharmaceutical industry to prohibit government price negotiation, creating a guaranteed market at uncontrolled prices. - [[GLP-1 Drugs]] — Glucagon-like peptide-1 receptor agonists (Ozempic, Wegovy, Mounjaro); the defining pricing flashpoint whose explosive demand is reshaping insurance costs, pharma revenue, and food industry economics simultaneously. ## Related Hubs and Concepts - [[Healthcare Industry Ecosystem]] — the ownership map - [[Big Pharma]] — drugs and devices - [[Pharmacy Benefit Managers]] — the middlemen - [[Hospital Consolidation]] · [[Vertical Integration]] · [[Medicare Advantage]] - [[Private Equity]] · [[Financialization]] · [[Rural Hospital Closures]] ## See Also - [[Economics Lexicon]] — the broader economic vocabulary that frames healthcare policy