The US healthcare system has devised
a number of methods to track the services provided by physicians and others in
the care of individuals needing services. It is important to know and
understand how these methods track care and turn that into revenue. Consider
what you have learned this week and apply it to this assignment.
Tasks:
Briefly describe the major
third-party payers who provide revenue to healthcare providers. Also describe
provider incentives and risks under each of the following reimbursement
methods:
- Cost based
- Charge based
- Per procedure
- Per diagnosis
- Per diem
- Bundled payment
- Capitation
Submission Details:
- Present your analysis as a 2-page report in a Microsoft
Word document formatted in APA style. - On a separate page, cite all sources using APA format
with in-text citations.
|
Assignment 3 Grading Criteria |
Maximum |
|
Described the major third-party |
10 |
|
Described provider incentives and |
30 |
|
Wrote in a clear, concise, and |
10 |
|
Total: |
50 |
Expert Solution Preview
Introduction: The US healthcare system relies on third-party payers to reimburse healthcare providers for the services provided to individuals in need. The different reimbursement methods have different provider incentives and risks associated with them. In this report, we will briefly describe the major third-party payers and the provider incentives and risks under each of the reimbursement methods.
1. Briefly describe the major third-party payers who provide revenue to healthcare providers.
The major third-party payers include private insurance companies, Medicare, and Medicaid. Private insurance companies provide coverage to individuals who have insurance through their employer or who purchase insurance independently. Medicare is a federal health insurance program for individuals aged 65 or older, individuals with end-stage renal disease, and individuals with certain disabilities. Medicaid is a joint federal and state program that provides healthcare coverage to individuals with low income and limited resources.
2. Describe provider incentives and risks under each of the following reimbursement methods:
a) Cost based: Under cost-based reimbursement, providers are reimbursed for their actual costs of providing services. The incentive for providers is to provide the most expensive services possible to increase reimbursement. The risk for providers is that they may not be able to cover all their costs, leading to financial losses.
b) Charge-based: Under charge-based reimbursement, providers are reimbursed based on their charges for services. The incentive for providers is to increase charges to increase reimbursement. The risk for providers is that charges may not reflect actual costs, leading to lower reimbursement.
c) Per procedure: Under per procedure reimbursement, providers are reimbursed for each individual procedure performed. The incentive for providers is to perform more procedures to increase reimbursement. The risk for providers is that they may perform unnecessary procedures to increase reimbursement.
d) Per diagnosis: Under per diagnosis reimbursement, providers are reimbursed based on the diagnosis of the patient. The incentive for providers is to diagnose more expensive conditions to increase reimbursement. The risk for providers is that they may misdiagnose or overdiagnose conditions to increase reimbursement.
e) Per diem: Under per diem reimbursement, providers are reimbursed based on a daily rate for hospitalization or nursing home care. The incentive for providers is to minimize length of stay to maximize reimbursement. The risk for providers is that patients may be discharged too early, leading to poor outcomes.
f) Bundled payment: Under bundled payment reimbursement, providers are reimbursed a single payment for all services provided for a specific condition or procedure. The incentive for providers is to work collaboratively and efficiently to provide services within the budgeted amount. The risk for providers is that if services provided exceed the budgeted amount, the provider may have to cover the costs.
g) Capitation: Under capitation reimbursement, providers are reimbursed a fixed amount per patient enrolled in their plan each month. The incentive for providers is to provide preventative care and manage the health of their patients to minimize expenses. The risk for providers is that they may provide less care to minimize expenses, leading to poor health outcomes.
Conclusion: In conclusion, understanding the different reimbursement methods and their provider incentives and risks is important for healthcare providers to effectively manage their finances and provide quality care to their patients.
