Funding Of Healthcare/ Reimbursement Issues Essay Paper

Funding Of Healthcare/ Reimbursement Issues Essay Paper

Funding Of Healthcare/ Reimbursement Issues Essay Paper

Pay-for-performance (P4P) is the compensation representation that compensates healthcare contributors for accomplishing pre-authorized objectives for the delivery of quality health care assistance by economic incentives. P4P is increasingly put into practice in the healthcare structure to support quality enhancements in healthcare systems. Thus, pay-for-performance can be seen as a means of attaching financial incentives to the main objectives of clinical care. However, reimbursement is a managed care payment by a third party to a beneficiary, hospital or other health care providers for services rendered to an insured or beneficiary. This paper discusses how reimbursement can be affected by the pay-for-performance approach and how system cost reductions impact the quality and efficiency of healthcare. In addition, it also addresses how pay-for-performance affects different healthcare providers and their customers. Finally, there will also be a discussion on the effects pay-for-performance will have on the future of healthcare. Funding Of Healthcare/ Reimbursement Issues Essay Paper


How Reimbursement Is Affected By Pay-For-Performance Approach
Healthcare payers agree with the idea of Evidence-Based Medicine (EBM) to advocate for pay-for-performance in provider reimbursement on quality and efficiency. The fundamental system that most payers use to compensate physicians and provider associations embodies enticements for excellence and efficiency. Reimbursement can be affected by the P4P approach and other factors such as the claims process, out-of-network payments, legislation, audits and denials. While the same P4P approaches are attempts to commence incentives and new strategies into the healthcare, the underlying arrangement of the compensation system produces Funding Of Healthcare/ Reimbursement Issues Essay Paper

There are two broad approaches to financing health care: a market-based approach and a government-financed approach. For each approach, answer the following questions: 1. Who is provided access? Most government financed systems are inclined to make available for every person living in the nation with treatment which proposes access to some fundamental level of care. Majority of people pay for coverage through taxes and additional charges. In government financed health care the government may provide care itself such as the United Kingdom or they may contact other providers to do so ex: Germany and Japan or in the United States …show more content…
This rewards quantity over quality. Fee for service does nothing to promote low cost, high value services, such as preventive care or patient education even if they could considerably enhance patients’ physical condition and reduce health care costs through the system. 78% of employer sponsored health insurance is was fee for service. Reimbursement is the form of payment for services provided. The most common practice is the insurance company pays to the provider directly. Under the MCO when receiving care the patient is usually required to pay a small amount out of pocket such as 15 or 20 dollars and the rest is picked up by the managed care plan.
4. How does reimbursement apply? Reimbursement is the determination how much to pay for certain services.
Reimbursement is costs or repayment for health care benefits. In the United States health benefits are often provided before the payment is made. End result physicians, clinics, hospitals, and other health care contributor establishment request reimbursement for health services provided in addition to expenses incurred. Presently reimbursement of claims for healthcare service depends on the appointment of medical codes to explain the diagnosis.Funding Of Healthcare/ Reimbursement Issues Essay Paper
There are two broad approaches to financing health care: a market-based approach and a government-financed approach. For each approach, answer the following questions: 1. Who is provided access? Most government financed systems are inclined to make available for every person living in the nation with treatment which proposes access to some fundamental level of care. Majority of people pay for coverage through taxes and additional charges. In government financed health care the government may provide care itself such as the United Kingdom or they may contact other providers Funding Of Healthcare/ Reimbursement Issues Essay Paper
This rewards quantity over quality. Fee for service does nothing to promote low cost, high value services, such as preventive care or patient education even if they could considerably enhance patients’ physical condition and reduce health care costs through the system. 78% of employer sponsored health insurance is was fee for service. Reimbursement is the form of payment for services provided. The most common practice is the insurance company pays to the provider directly. Under the MCO when receiving care the patient is usually required to pay a small amount out of pocket such as 15 or 20 dollars and the rest is picked up by the managed care plan.
4. How does reimbursement apply? Reimbursement is the determination how much to pay for certain services.
Reimbursement is costs or repayment for health care benefits. In the United States health benefits are often provided before the payment is made. End result physicians, clinics, hospitals, and other health care contributor establishment request reimbursement for health services provided in addition to expenses incurred. Presently reimbursement of claims for healthcare service depends on the appointment of medical codes to explain the diagnosis.

correctly with varied crowds of patients to reduce incentives to keep away from most patients is quite challenging. Finally, the effects pay-for-performance will have on the future of the health care depends on incentives with “teaching to the test” to guarantee that the affirmative objectives are not attained at an enormous price.

The Social Security Act of 1965 created Medicare and Medicaid, which provides health care coverage for the elderly, poor, and disabled. Medicare has become the largest single payer health entity spending $57.9 billion in 1980, $271 billion in 2003, and $513 billion in 2010 (Social Security Administration, 2012). Whereas, Medicaid being state funded, its governance is state-specific for spending. There have been very few changes to The United States health care payment system since Medicare’s and Medicaid’s inception, until March 23, 2010 Funding Of Healthcare/ Reimbursement Issues Essay Paper

Definition of the problem intended to be solved by legislation/policy
The problems (for this paper) with the current reimbursement for patients with Medicare and Medicaid, begins with and depends on how one looks at the problem. Physicians/providers, patients, and payers all have different opinions on what the actual problems are. This graduate nursing student (GNS) identifies these five primary problems. First, the traditional fee-for-service model, that pushes or rewards (financially) quantity of care provided, and deters or punishes quality of care provided seems to be the most pressing issue (Thorpe and Ogden, 2010), as well as, contradicts the premise of the ACA. Second, the reimbursement rates for Medicaid are significantly lower than Medicare and Medicaid dollars spent are matched at the federal level. Depending on the state and service, the difference can be up to 59% lower for Medicaid. (Sommers, Paradise, and Miller, 2011).
Third, the looming 24% Medicare cut across the board, that will affect Medicaid too, has been thwarted again by legislation. Fourth, prior to the ACA, physicians were already limiting the number of Medicare and Medicaid patients because of lower reimbursement rates, delayed payments, and non-clinical spent for patient care (not reimbursed) (Sommers, Paradise, and Miller, 2011). Now, only four years after the ACA was passed into law, the number of primary care physicians has decreased by 17% (AHRQ, 2014), creating an even larger dilemma then reimbursements.
Fourth, with the above mentioned problems and along with Medicaid expansion (in the states that have chosen to expand) have caused an increase in the number of people eligible. Thus, this creates an even larger bottleneck to prevent access to health care The Department of Veterans Affairs is a prime example of too many patients and not enough resources. Although, the looming 24% Medicare cut required by a law passed in 1997 to reduce Medicare payments to all providers is not addressed by the ACA, this GNS thinks it is vitally important to note that it was just passed by Congress for the 17th time and has become known as doc fix legislation (Peterson, 2014). Funding Of Healthcare/ Reimbursement Issues Essay Paper
Finally, the problem with the ACA is not only with what it did address, but with what it did not address in making sure health care is accessible and reimbursed to providers, presumably its stated goal. For example, Medicare will have 140,000 different codes next year for billing that the ACA has not addressed, which is complicating matters. The Economist (May 31-June 6 ) discusses how there are nine codes for injuries related to a turkey encounter (patient struck or pecked, once or multiple times, infection/s as a result, etc…). This GNS mentions this because it is a great example of Medicare’s ridiculousness and an area that the government has ignored and hindered health care’s functionality. Dr. B. Bojewski, D.O. (personal communication, May 23, 2014) reports, providers in all areas of practice,…

More and more, the popular press discusses rural hospitals as though they were an “endangered species,” with the implication that the forces leading to their extinction are inexorable. Indeed, the problems facing these institutions do seem at times to be overwhelming. 1 During the 1980s, the declining economy of many rural areas led increasing numbers of young adults to migrate to urban areas. The remaining population served by rural hospitals is becoming poorer, older, and increasingly likely to be covered by public insurance programs. Because of the relatively high proportion of rural hospital patients who are elderly, rural hospitals are particularly vulnerable to Medicare payment policies. Rural advocates argue that current policies are insensitive to the special problems of small hospitals, pointing to reports of widespread financial losses and an increasing number of hospital closures concentrated among facilities with fewer than fifty beds. 2 Some sources predict that as many as 600 rural hospitals could close over the next few years.Funding Of Healthcare/ Reimbursement Issues Essay Paper

The problems of rural hospitals have generated a sympathetic response from the media and some members of Congress. 4 Both the 99th and the 100th Congress passed legislation to modify the way in which rural hospitals are paid under Medicare’s prospective payment system (PPS). In the 100th Congress, the National Rural Health Care Act of 1988 was introduced by Rep. Edward Roybal (D-CA) with a wide-ranging agenda for changes in rural health care financing and delivery. Congress also legislated a “transition grants” program, under the sponsorship of Sen. David Durenberger (R-MN). This program, administered through the Health Care Financing Administration (HCFA), provides small grants to rural hospitals to diversify services, convert acute care beds to other uses, and engage in other similar activities. In addition, the Department of Health and Human Services (HHS) has created an Office of Rural Health Policy to coordinate public- and private-sector initiatives on rural health care. Clearly, rural health care delivery, and particularly the viability of rural hospitals, has emerged once again as a high-profile issue for federal health policymakers, although no coherent overall rural health policy has yet been articulated.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Stimulated in part by government and private foundation grant programs, rural hospitals have increasingly sought to address their problems through collective action. Many of these facilities have affiliated with a multihospital system. The American Hospital Association (AHA) reports that about one-third of rural community hospitals are owned, leased, or contract-managed by multihospital systems, and that system involvement is heaviest in regions where investor-owned systems are most prevalent (South Atlantic, Mountain, and Pacific). 5 However, this trend appears to have weakened, possibly because of financial losses incurred by these systems coupled with concerns on the part of rural communities that system affiliation can result in a loss of hospital autonomy and reduced hospital sensitivity to local needs. 6 In contrast, rural hospital alliances, or consortia, seem to be gaining in popularity among rural hospitals as a means of obtaining the benefits of collective action, while maintaining a greater degree of local control over hospital decision making. In this essay, we describe rural hospital consortia in the United States and discuss the factors that appear to facilitate or impede their development, using data collected as part of an ongoing evaluation of The Robert Wood Johnson Foundation’s Hospital-Based Rural Health Care (HBRHC) program.Funding Of Healthcare/ Reimbursement Issues Essay Paper

While the level of formality of consortium arrangements varies, the primary purpose of all rural hospital consortia is to provide an administrative framework for developing joint activities among member institutions. As the Senate’s Special Committee on Aging (1989) has observed, relatively little is known about the number, structure, and activities of rural hospital consortia or the developmental problems that they face. 7 A 1986 survey conducted by National Health Advisors found nine rural hospital alliances ranging in size from four to twenty-five hospitals. 8 More recently, a staff report to the Senate’s Special Committee on Aging speculated that as many as a quarter of rural hospitals (approximately 650) participate in hospital consortia. Funding Of Healthcare/ Reimbursement Issues Essay Paper

In December 1988, we initiated an effort to identify and survey all rural hospital consortia in the United States. We began with a list of 180 consortium applicants to the HBRHC program and added to this number through a phone survey of representatives of each of the fifty state hospital associations. We identified 269 potential rural hospital consortia in this manner. We completed telephone interviews with representatives from 266 of these organizations, resulting in a list of 127 groups of rural hospitals that met our loose definition of a consortium: any group of rural hospitals (or rural and urban hospitals) that meet or work together for specific purposes and have specific membership criteria.

The average number of rural hospitals in these consortia was 12.7, with a median participation of nine. If this represented an unduplicated count, it would suggest that 1,600 hospitals nationwide belong to consortia. However, since many rural hospitals participate in more than one consortium, the total number of hospitals participating in consortia is approximately 1,000, or slightly less than half of all U.S. rural hospitals. Clearly, rural hospital consortia have the potential to play a significant role in health care delivery in rural areas.Funding Of Healthcare/ Reimbursement Issues Essay Paper

It appears that rural hospital consortia are a relatively recent phenomenon, since 59 percent of the consortia we identified were three years old or younger in December 1988, while only 14 percent had existed for longer than ten years. Twenty-eight percent of the consortia had nonhospital members, and slightly over half listed a hospital located in a metropolitan statistical area as a member.

Typically, hospitals in rural consortia retain the option of participating, or not participating, in each consortium activity. The common thread among all such activities is that voluntary cooperation among rural hospitals can yield benefits unavailable to an individual hospital acting alone. For example, while a single rural hospital may not have adequate numbers of patients or resources to purchase specialized equipment, a group of rural hospitals may be able to do so in a cost-effective manner. Thus, a consortium of rural hospitals in the Midwest has purchased magnetic resonance imaging (MRI) equipment jointly. Sharing services of this type can benefit rural hospitals financially by reducing the likelihood that rural residents will travel to urban centers for specialized diagnostic care. It also, of course, improves access to services in rural areas.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Joint physician and staff recruitment can be carried out through consortia, since a group of hospitals often can negotiate a more favorable contractual arrangement with a recruiting firm than can a single rural hospital. Consortium members can share advertising costs for allied health personnel and nurses, allowing broader coverage in national journals. In some consortia, shared staff arrangements for allied health and nursing personnel have evolved to address fluctuations in patient census or the need for flexible part-time staff.

Consortia can also facilitate the sharing of costs for marketing surveys or community relations campaigns for their members. And, group efforts to improve quality in rural hospitals are now occurring through consortia. Standardized credential review processes and the sharing of a full-time quality assurance coordinator often result from these efforts. Many other kinds of activities are possible under a consortium framework, including management and financial consultation, acute care bed conversions, the development of primary or specialty clinics, lobbying on legislative issues, and regional planning. In our survey, we found that the average consortium was involved in six different types of activities. Four out of five consortia had educational programs for physicians or hospital personnel, and four of five had shared service programs. Two-thirds of rural hospital consortia conducted legislative liaison activities. The least common activities arguably were the ones requiring the highest level of cooperation and trust among participating hospitals: acute care bed conversions and quality assurance. Only one of five consortia reported acute care bed conversion projects, and two of five had joint quality assurance or credentialing efforts.Funding Of Healthcare/ Reimbursement Issues Essay Paper

If participation in a hospital consortium proves to be an attractive way for rural hospitals to enhance their financial viability and the quality of the services they offer to their communities, then it will be important for policymakers and hospital administrators to understand the factors that can influence consortium development and implementation. To identify these factors, we conducted structured interviews with consortium directors and hospital administrators at the thirteen HBRHC program sites, approximately four to nine months after they had first received grant funds from The Robert Wood Johnson Foundation.

The consortia in the HBRHC program were selected from 180 applications submitted by groups of hospitals and other health care organizations in response to a program solicitation by the foundation. Fourteen consortia were chosen to receive funding of approximately $150,000 per year, with a progress review to occur at the end of two years. The foundation offered a maximum of four years of support, along with access to loan funds not to exceed $500,000 per consortium. One of the selected consortia withdrew from the program early in its first year because it was unable to maintain support among its member hospitals for its only proposed program—a rural health maintenance organization (HMO).Funding Of Healthcare/ Reimbursement Issues Essay Paper.

There was considerable variation in regional environments and organizational characteristics among the remaining thirteen consortia. The degree of prior collaboration among hospitals ranged from little or no previous cooperative activities or meetings in some consortia to a highly formalized consortium that had been in existence for ten years. The consortia were administered through state hospital associations, state planning agencies, tertiary care centers, and freestanding consortium organizations. In most cases, the consortium’s governing board was composed of all consortium members, while, in a few cases, the board was composed of a smaller number of appointed members. All consortia had a designated director, although the person designated sometimes had other duties as well. The number of additional consortium staff, beyond the director, ranged from none to over forty.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Environmental and demographic characteristics indicate a great deal of diversity among the thirteen consortium sites. The population of their market areas ranged from 44,000 persons in northern Montana to nearly one million persons in South Carolina and in southern Maine. The smallest geographic area included within a consortium boundary was 3,500 square miles (northeastern New York), while the largest was 90,000 square miles (Nevada). Population density was lowest in Nevada, at 1.1 persons per square mile, and highest in western New York, at 119 persons per square mile. The percentage of the population age sixty-five and over ranged from 9.8 percent in South Carolina to 15.4 percent in Missouri, while the percentage of area population living in poverty ranged from 10.6 percent in western New York to 25.3 percent in Alabama. Physician shortages appeared particularly acute in Nevada (sixty-one physicians per 100,000 residents) and Montana (sixty-six per 100,000 residents). Northern Maine, southern Maine, and northeastern New York were the consortium areas with the greatest number of physicians per capita, but they were still below the national average of about 180 patient care physicians per 100,000 population.Funding Of Healthcare/ Reimbursement Issues Essay Paper

The HBRHC consortia proposed to pursue a broad range of activities (Exhibit 1 ). Eight consortia intended to develop shared-services programs of some type, while seven planned joint professional recruitment activities. Seven others hoped to develop primary care or specialty clinics through the cooperative efforts of participating hospitals. At the other extreme, only two consortia planned to develop quality assurance programs.

The two programs are very different, but they both come under the management of the Centers for Medicare and Medicaid Services. This is a division of the U.S. Department of Health and Human Services.

President Lyndon B. Johnson created both Medicaid and Medicare when he signed amendments to the Social Security Act on July 30, 1965.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Medicaid is a social welfare, or social protection, program. Data from August 2018 show that it serves about 66.6 million people.

Medicare is a social insurance program that served more than 56 millionenrollees in 2016.

Medicaid, Medicare, the Children’s Health Insurance Program, and other health insurance subsidies represented 26 percent of the 2016 federal budget, according to the Center on Budget and Policy Priorities.

The Centers for Medicare and Medicaid Services (CMS) report that 91.1 percent of the U.S. population had medical insurance in that year.

According to the 2017 U.S. census, 67.2 percent of people have private insurance while 37.7 percent have government health coverage.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Medicaid is a means-tested health and medical services program for certain individuals and low-income households with few resources.

Primary oversight of the program happens at the federal level, but each state is responsible for:

  • establishing its eligibility standards
  • determining the type, amount, duration, and scope of its services
  • setting the rate of payment for services
  • administering its own Medicaid program

Each state makes the final decisions regarding what their Medicaid plans provide, but they must meet some federal requirements to receive federal matching funds.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Medicaid does not directly provide people with health services. Instead, it reimburses healthcare providers for the care that they deliver to enrolled patients.

Not all providers need to accept Medicaid, so it is essential that users check their coverage before receiving care.

People who do not have private health insurance can seek help at a federally qualified health center (FQHC). These provide coverage on a sliding scale, depending on the person’s income.

Centers must provide specific services, including:

  • inpatient hospital services
  • outpatient hospital services
  • prenatal care
  • vaccines for children
  • physician services
  • nursing facility services for people aged 21 years or older
  • family planning services and supplies
  • rural health clinic services
  • home healthcare for people who are eligible for skilled nursing services
  • laboratory and X-ray services
  • pediatric and family nurse practitioner services
  • nurse-midwife services
  • FQHC services and ambulatory services
  • early and periodic screening, diagnostic, and treatment (EPSDT) services for both children and adults under the age of 21 years Funding Of Healthcare/ Reimbursement Issues Essay Paper

States may also choose to provide optional additional services and still receive federal matching funds. The most common of the 34 approved optional Medicaid services are:

  • diagnostic services
  • prescribed drugs and prosthetic devices
  • optometrist services and eyeglasses
  • nursing facility services for children and adults under the age of 21 years
  • transportation services
  • rehabilitation and physical therapy services
  • dental care

The program aims to help people in low-income households, but there are other eligibility requirements too. These relate to age, pregnancy status, disability status, other assets, and citizenship.

For a state to receive federal matching funds, it must provide Medicaid services to individuals who fall under certain categories of need.

For example, the state must provide coverage for some individuals who receive federally assisted income-maintenance payments and similar groups who do not receive cash payments.

The federal government also considers some other groups to be “categorically needy.” People in these groups must also be eligible for Medicaid.Funding Of Healthcare/ Reimbursement Issues Essay Paper

They include:

  • children under the age of 18 years whose household income is at or below 138 percent of the federal poverty level (FPL)
  • pregnant women with a household income below 138 percent of the FPL
  • people who receive Supplemental Security Income (SSI)
  • parents who earn an income that falls under the state’s eligibility for cash assistance

States may also choose to provide Medicaid coverage to other, less well-defined groups who share some characteristics with those above.

These may include:

  • pregnant women, children, and parents who earn an income above the mandatory coverage limits
  • some adults and seniors with low income and limited resources
  • people who live in an institution and have low income
  • certain adults who are older, have vision loss or another disability, and have an income below the FPL
  • individuals without children who have a disability and are near the FPL
  • “medically needy” people whose resources are above the eligibility level that their state has set

Medicaid does not provide medical assistance to all people with low income and resources.

The Affordable Care Act of 2012 gave states the option to expand their Medicaid coverage.

In the states that did not expand their programs, several at-risk groups are not eligible for Medicaid.Funding Of Healthcare/ Reimbursement Issues Essay Paper

These include:

  • adults over the age of 21 years who do not have children and are pregnant or have a disability
  • working parents with incomes below 44 percent of the FPL
  • legal immigrants during their first 5 years of living in the U.S.

Medicaid does not pay money to individuals but sends payments to healthcare providers instead.

States make these payments according to a fee-for-service agreement or through prepayment arrangements, such as health maintenance organizations (HMOs).

The federal government then reimburses each state for a percentage share of their Medicaid expenditures.

This Federal Medical Assistance Percentage (FMAP) changes each year, and it depends on the state’s average per capita income level.

The average reimbursement rate varies between 57 and 60 percent. Wealthier states receive a smaller share than poorer states, which can receive up to 73 percent of the money back from the federal government.

In the states that chose to expand their coverage once the Affordable Care Act became effective, more adults and families on low incomes became eligible because the new provision allowed enrolment at up to 138 percent of the FPL. In return, the federal government covers all of the expansion costs for the first 3 years and over 90 percent of the costs moving forward.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Medicare is a federal health insurance program that pays for hospital and medical care both for people in the U.S. who are older and for some people with disabilities.

The program consists of:

  • two main parts for hospital and medical insurance (Part A and Part B)
  • two additional parts that provide flexibility and prescription drugs (Part C and Part D)

Medicare Part A, or Hospital Insurance (HI), helps pay for hospital stays and other services.

In the hospital, this includes:

  • meals
  • supplies
  • testing
  • a semi-private room

It also pays for home healthcare, such as:

  • physical therapy
  • occupational therapy
  • speech therapy

However, these therapies must be on a part-time basis, and a doctor must consider them medically necessary.

Part A also covers:

  • care in a skilled nursing facility
  • walkers, wheelchairs, and some other medical equipment for older people and those with disabilities

Payroll taxes cover the costs of Part A, so a person does not usually have to pay a monthly premium. However, anyone who has not paid Medicare taxes for at least 40 quarters will need to pay it.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Medicare Part B, or Supplementary Medical Insurance (SMI), helps pay for specific services.

These include:

  • medically necessary physician visits
  • outpatient hospital visits
  • home healthcare costs
  • other services for older people and those with a disability
  • preventive care services

For example, Part B covers:

  • durable medical equipment, such as canes, walkers, scooters, and wheelchairs
  • physician and nursing services
  • certain vaccinations
  • blood transfusions
  • some ambulance transportation
  • immunosuppressive drugs after organ transplants
  • chemotherapy
  • certain hormonal treatments
  • prosthetic devices
  • eyeglasses

For Part B, people must:

  • pay a monthly premium, which was $134 per month in 2018
  • meet an annual deductible of $183 a year, before coverage begins Funding Of Healthcare/ Reimbursement Issues Essay Paper

Premiums might be higher or lower depending on the person’s income and Social Security benefits.

Enrollment in Part B is voluntary.

Medicare Part C, also known as Medicare Advantage Plans or Medicare+ Choice, allows users to design a custom plan to suit their medical needs more closely.

Part C plans provide everything in Part A and Part B, but may also offer additional services, such as dental, vision, or hearing.

These plans enlist private insurance companies to provide some of the coverage. However, the details will depend on the program and the eligibility of the individual.

Some Advantage Plans team up with HMOs or preferred provider organizations (PPOs) to deliver preventive healthcare or specialist services. Others focus on people with specific needs, such as individuals living with diabetes.

This prescription drug plan was a later addition in 2006. Several private insurance companies administer Part D.

These companies offer plans that vary in cost and cover different lists of drugs.

To participate in Part D, a person must pay an additional fee called the Part D income-related monthly adjustment amount. The fee will depend on the person’s income.

In many cases, the amount will come out of the person’s Social Security check. However, others will get a bill from Medicare instead.Funding Of Healthcare/ Reimbursement Issues Essay Paper

If Medicare does not cover a medical expense or service, Medigap plans can provide supplemental coverage for it.

Private companies also offer Medigap plans.

Depending on the individual plan, Medigap may cover:

  • copayments
  • coinsurances
  • deductibles
  • care outside of the country

If a person has a Medigap policy, Medicare will first pay the portion that it will cover, and then Medigap will pay the rest.

To have a Medigap policy, a person must have both Medicare Part A and Part B and pay a monthly premium.

Medigap policies do not cover prescription drugs. A person must have a Part D plan for that coverage.

To be eligible for Medicare, an individual must meet one of the following requirements:

  • being at least 65 years old
  • being under 65 years old and living with a disability
  • being any age with end-stage renal disease or permanent kidney failure that needs dialysis or a transplant

They must also be:

  • a U.S. citizen or permanent legal resident for 5 continuous years
  • eligible for Social Security benefits with at least 10 years of contributing payment into the system Funding Of Healthcare/ Reimbursement Issues Essay Paper

The US healthcare system seems headed for bankruptcy because of its ever increasing and unsustainable costs. These costs will be effectively controlled only by legislative reforms in the insurance and payment for medical care, but the prospects of such legislation will depend on a more favourable political climate and stronger public support. However, legislation will accomplish little unless the organisation of medical services also changes. The recent movement of US physicians into large multispecialty groups suggests that this reorganisation of medical care may already be under way. If this trend continues, it could not only facilitate the enactment of legislation, but also help to make our medical care much more affordable and efficient.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Reflection on the recent ACA/HHS “Nondiscrimination in Health Programs and Activities” final rule raises the question of the feasibility of operating a Catholic healthcare system without reimbursement from government healthcare programs such as Medicare and Medicaid. This brief analysis will ask more questions than it will answer. It provides an overview for physicians and other healthcare professionals of the challenges Catholic hospitals and health systems would face in operating without government-funded healthcare programs. The questions raised will require further research by legal, financial, and regulatory professionals. Ultimately it will be very difficult if not impossible to operate without governmental reimbursement and Medicare certification.Funding Of Healthcare/ Reimbursement Issues Essay Paper

On May 13, 2016, HHS issued the “Nondiscrimination in Health Programs and Activities” final rule, implementing Section 1557 of Affordable Care Act. (HHS 2016) It is too early for the publication of commentaries regarding the final rule but it appears to prohibit insurers and providers from categorically denying gender transition procedures as well as abortion services.1 The final rule does not contain any specific religious or conscience exemption but relies on existing federal law.2 Healthcare and civil rights attorneys will need to address the specific requirements and the viability of protection of Catholic hospitals under the Religious Freedom Restoration Act or other federal law Funding Of Healthcare/ Reimbursement Issues Essay Paper

Virtually all general acute- care hospitals in the US accept Medicare and Medicaid patients and in order to be paid for those services must have a Medicare provider agreement/Medicare certification. Among other requirements, Medicare certification requires adhering to the Centers for Medicare and Medicaid Services “Conditions of Participation.” A healthcare attorney would need to research how the new final rule is covered under the “Conditions of Participation,” but this essay assumes that not complying with the new final rule would cause a hospital to be out of compliance with the “Conditions of Participation” and would place it in “immediate jeopardy” of losing its Medicare certification. Further non-compliance would result in the loss of the hospital’s Medicare certification within a matter of days.

When asked the question as to the feasibility of hospitals operating without governmental reimbursement, my initial response was no, it would not be feasible. In writing this essay, and giving much more thought to the issue, my answer remains a very narrowly qualified no. As will be shown, the complexities and interrelationships of strategic, financial, and operational facets of hospitals make it very difficult if not impossible to operate without governmental reimbursement and Medicare certification.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Having made the assumption that Catholic hospitals would be required to comply with the final rule, non-compliance would ultimately result in loss of the hospital’s Medicare provider agreement and Medicare certification. Without Medicare certification, the hospital would not be able to bill Medicare or any other federal healthcare program (Medicaid, Tri-Care, Medicare Advantage). The resultant loss of revenue and margin would be catastrophic. According to the 2014 Tennessee Department of Health Joint Annual Report of Hospitals, the average Tennessee not-for-profit acute-care hospital received 48 percent of its net revenue from government sources.4 A reduction of this magnitude would be devastating for any organization, let alone one as complex as a hospital. A hospital would perhaps be able to sustain this reduction in net revenue if it occurred over an extended period of time (years) allowing it to develop a strategic plan for downsizing. But in the case of Medicare certification and its loss for non-compliance the process takes days not years.Funding Of Healthcare/ Reimbursement Issues Essay Paper

A significant factor of the loss of revenue from government payer sources is the broad nature of the patients and programs affected. If it were only Medicare, some programs, maternal-child health for example, would not be impacted. But as the loss of revenue would include Medicare, Medicaid, and Tri-care, it would impact all programs within the hospital or system. With such a dramatic reduction in net revenue, the hospital would need to reduce expenses to a greater degree than the reduction in net revenue, to maintain a margin necessary to meet its other obligations, such as long-term debt payments. Assuming a 6 percent net income margin, a 48 percent reduction in net revenue would require a 51 percent reduction in expenses to maintain the same dollar margin to meet obligations. This three-point differential may not seem significant, but assuming annual net revenue of $500 million it would represent $15 million. Exacerbating this difficulty would again be the broad nature of the programs impacted and the number that would be unable to achieve the 51 percent reduction in expenses without closure. Many programs or units would often face minimum staffing requirements. Most impacted would be areas such as labor and delivery, NICU, and smaller or more specialized critical care units. The severity of reduction would require consolidating many units with the resultant loss of specialization. This in turn would likely result in the defection of the most specialized and best nurses and ancillary personnel to unaffected hospitals that would be thriving due to the influx of patients and revenue. Equally damaging would be the defection of the majority of the medical staff to the same providers.Funding Of Healthcare/ Reimbursement Issues Essay Paper

In the late 19th century, “accident insurance” began to be available, which operated much like modern disability insurance.[62][63] This payment model continued until the start of the 20th century in some jurisdictions (like California), where all laws regulating health insurance actually referred to disability insurance.[64]

Accident insurance was first offered in the United States by the Franklin Health Assurance Company of Massachusetts. This firm, founded in 1850, offered insurance against injuries arising from railroad and steamboat accidents. Sixty organizations were offering accident insurance in the U.S. by 1866, but the industry consolidated rapidly soon thereafter. While there were earlier experiments, the origins of sickness coverage in the U.S. effectively date from 1890. The first employer-sponsored group disability policy was issued in 1911.[65]

Before the development of medical expense insurance, patients were expected to pay health care costs out of their own pockets, under what is known as the fee-for-service business model. During the middle-to-late 20th century, traditional disability insurance evolved into modern health insurance programs. One major obstacle to this development was that early forms of comprehensive health insurance were enjoined by courts for violating the traditional ban on corporate practice of the professions by for-profit corporations.[66] State legislatures had to intervene and expressly legalize health insurance as an exception to that traditional rule. Today, most comprehensive private health insurance programs cover the cost of routine, preventive, and emergency health care procedures, and most prescription drugs (but this is not always the case).Funding Of Healthcare/ Reimbursement Issues Essay Paper

Hospital and medical expense policies were introduced during the first half of the 20th century. During the 1920s, individual hospitals began offering services to individuals on a pre-paid basis, eventually leading to the development of Blue Crossorganizations.[65] The predecessors of today’s Health Maintenance Organizations (HMOs) originated beginning in 1929, through the 1930s and on during World War II.[67][68]

The Employee Retirement Income Security Act of 1974 (ERISA) regulated the operation of a health benefit plan if an employer chooses to establish one, which is not required. The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) gives an ex-employee the right to continue coverage under an employer-sponsored group health benefit plan.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Through the 1990s, managed care insurance schemes including health maintenance organizations (HMO), preferred provider organizations, or point of service plans grew from about 25% US employees with employer-sponsored coverage to the vast majority.[69] With managed care, insurers use various techniques to address costs and improve quality, including negotiation of prices (“in-network” providers), utilization management, and requirements for quality assurance such as being accredited by accreditation schemes such as the Joint Commission and the American Accreditation Healthcare Commission.[70]

Employers and employees may have some choice in the details of plans, including health savings accounts, deductible, and coinsurance. As of 2015, a trend has emerged for employers to offer high-deductible plans, called consumer-driven healthcare plans which place more costs on employees; some employers will offer multiple plans to their employees Funding Of Healthcare/ Reimbursement Issues Essay Paper

In almost 20 years as an independent practicing physician (10 years as a hospitalist, after 8 years as a primary care pediatrician [PCP] in private practice), I have cared for a wide variety of patients. I have also had firsthand knowledge, from 2 sides of pediatric practice, of how the strange economics of the US Health Care System strongly influence my day-to-day practice. As I look back on my years as a PCP, I now realize that there were 2 main reasons why I chose to become a hospitalist. First, I missed caring for more acute, sicker patients. Second, I was extremely frustrated with the waste, inefficiencies and bizarre incentives of the system. The fact that taking a few minutes to reduce a nursemaid’s elbow was more valuable to the bottom line than spending 45 minutes with a family to break the news that their newborn has Down syndrome caused me a lot of stress and anxiety. The fact that as a partner in a private practice I had a responsibility to make sure we could pay our bills and keep the office open just made things worse.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Much has been written about our broken health care system over the past several years. Experts enumerate many factors that led to our current state, including a high percentage of uninsured/underinsured, high prices, overutilization of some things, underutilization of others, waste, inefficiency, fraud, and fee-for-service.1–3 The question remains: which factors are truly responsible for the problems with our system? I do not know the definitive answer to this question, and I’m sure if you asked 10 experts you would receive 10 different answers. However, I have identified 2 factors that I believe were mostly responsible for the issues I struggled with in private practice. As a hospitalist, I find that remembering them is extremely helpful when I encounter patients who have had treatments or therapies ordered by PCPs that seem questionable or when I encounter difficulty identifying a PCP to follow-up a patient who is inadequately insured. I also try to incorporate my experience to educate our residents that the care a patient previously received as an outpatient is not necessarily all directly attributable to the PCP, so we need to make sure that we do not judge people unfairly.Funding Of Healthcare/ Reimbursement Issues Essay Paper

The first factor is that families with “good” insurance (read “low co-pays, and generous coverage”) generally have poor price sensitivity to the care they receive.3 Simply said, they don’t know what the cost is of the test or treatment ordered by their PCP or other physicians.1–3 Why should they? Because most of the payment for services is directly from the insurance company to the provider, cost is removed as a reason for families to decide if something is really needed. Furthermore, patients rarely have access to enough information to do any price comparisons even if they are inclined to do so.1,3 One example I still think about was a child with chronic abdominal pain not associated with fever, vomiting, weight loss, or any other symptoms. She had a normal physical examination, despite a long history of constipation, diagnosed by one of my partners, which the family was resistant to treat. The family self-referred to a pediatric gastroenterologist, who also diagnosed constipation. The family disagreed, and subsequently went to the emergency department to demand a computed tomography scan, which was normal. They self-referred again and were evaluated by 2 other gastroenterologists, with the ultimate diagnosis of constipation. When I asked the mother if she was happy with the outcome, she said, “Sure, it’s not like I paid for all the tests and doctors … the insurance paid for it.” As a physician who was trying to provide high-quality, cost-effective care, this experience was not rewarding.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Much of my work, and the work of my collaborators and colleagues, remains focused on health care policy reforms, reforms in the private sector, and public-private collaborations to support providers and patients in their efforts to get to better care. I am a Senior Fellow at the Brookings Institution, where I direct a range of projects related to improving innovation and value in health care. I co-chair of the Quality Alliance Steering Committee, a multi-stakeholder group of employers, insurers, providers, and consumers that focuses on overcoming the practical challenges in implementing quality measures and using them to improve care. I chair the Roundtable on Value and Science-Driven Health Care of the Institute of Medicine (IOM), which focuses on improving clinical evidence and its use to achieve better care. I chair the Clinician Workgroup of the National Quality Forum (NQF)’s Measure Application Partnership (MAP), which prioritizes and recommends performance measures for implementation in Medicare and other Federal programs. Previously, as Administrator for the Centers for Medicare & Medicaid Services, I oversaw the implementation of a range of quality-related payment reforms, including provider reporting on quality and patient experience, and payment reforms related to “shared savings” and accountable care.Funding Of Healthcare/ Reimbursement Issues Essay Paper

We’ve made a lot of progress to support better quality care in recent years. Building on bipartisan legislation and support from the Congress, Medicare has established quality reporting systems for providers. There is more activity than ever around the development of quality measures, thanks to private organizations like the American Medical Association’s Physician Consortium for Performance Improvement (PCPI) and the National Committee for Quality Assurance, as well as public support and initiatives in the Centers for Medicare and Medicaid Services (CMS) and the Agency for Healthcare Research and Quality (AHRQ). The National Quality Forum (NQF) has taken important steps including assisting with the prioritization of measures for development and implementation, and especially in “endorsing” quality measures to promote the consistent use of meaningful, well-understood measures.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Today, there are numerous and diverse quality improvement initiatives underway at all levels of the health care system – federal, state, regional, local, and within health care organizations – that are putting quality measures to use. Quality improvement initiatives within and across health care organizations are core to these efforts. They require measurement in order to identify opportunities for improvement, often through “registries” that enable providers to assess and track how their patients are doing in terms of key aspects of care and potential complications in order to identify areas for improvement. Quality measures are also being used for payment reforms, which can enable health care providers to get more resources to take steps like setting up registries and implementing other changes in care delivery to improve care and avoid unnecessary costs. As an illustration, fee-for-service payments in Medicare, Medicaid, and the private sector have historically provided little financial support for many activities that can improve patient care and potentially reduce costs. Examples include taking time and implementing systems to coordinate care to avoid duplicative or inappropriate services; answering patient calls or emails to avoid the cost and delay of an office visit; and spending more time with a complex patient (or implementing a care team with a nurse practitioner, pharmacist, and other non-physician clinicians) to improve medication adherence, lifestyle changes, or other care management steps that can enable patients to prevent their diseases or health risks rom progressing. Private payers, employers, Medicare, and Medicaid are all undertaking a range of payment reforms to provide better support for such activities, generally in conjunction with using quality measures. Finally, quality measures are used increasingly in public reporting, thanks to national efforts like those supported by Medicare as well as impressive regional efforts, such as Puget Sound Health Alliance, Minnesota Community Measurement, Wisconsin Collaborative for Healthcare Quality, Pittsburgh Regional Health Initiative, and many others.Funding Of Healthcare/ Reimbursement Issues Essay Paper

But you only have to look at the evidence on what these quality measures show to know we have a long way to go. Last September, in its report on “Best Care at Lower Costs: The Path to Continuously Learning Health Care in America,” the IOM noted that patients get effective care only about half the time, that gaps in coordination remain widespread, that serious preventable medical errors are common, and that perhaps more than 30 percent of health care costs could be avoided as a result of improving quality and efficiency. These are not new findings; studies have been using progressively better quality measures to document gaps in quality and broad variations in costs that are not related to quality for decades.Funding Of Healthcare/ Reimbursement Issues Essay Paper

We also still have a long way to go in quality measurement. Many important quality measures available today have not been widely or consistently implemented. We lack robust quality measures for many important aspects of health care. We don’t have reliable, widely available quality measures for most of the things that really matter to patients, like the experience of care for patients like them, or measures related to their outcomes like how well they can function, work, and undertake their activities of daily life. And as you heard at last week’s very important hearing, we don’t have reliable and consistent information on the price and costs of care. Again, these are not new problems.

Some of the challenges facing quality measurement include: lack of alignment of key measures between public and private sector quality improvement efforts; issues regarding data transfer such as merging data across different information technology systems; ensuring secure protection of sensitive patient data and proprietary information; and developing, endorsing, and implementing measures of value – that is, sets of measures that include both quality and cost information. But the most important obstacle to greater use and impact of quality measures is that, today, quality still doesn’t matter that much in health care financing systems, including Medicare and Medicaid.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Recently, along with a group of health care leaders and experts, I authored a report on “Person-Centered Health Care Reform: A Framework for Improving Care and Slowing Health Care Cost Growth,” which described how to address the persistent problem of health care quality in all parts of our health care system. The report was the third in a Brookings series on “Bending the Curve” of rising health care costs. It included a wide range of health care experts as well as public policy leaders including Dan Crippen, Glenn Hubbard, Peter Orszag, Mike Leavitt, Donna Shalala, and Tom Daschle. What all of us concluded together was that the best way – really, the only way – to assure that we could achieve health care that was financially sustainable was to reform our health care financing and regulatory policies to do much more to support better-quality care and lower costs at the person level.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Our report proposes a framework for reforming health care financing and regulation to achieve better, higher-value care for each person. It describes a specific series of steps building on current initiatives to improve the way care is delivered in each part of our health care system, including Medicare and Medicaid, the employer and individual insurance markets, as well as antitrust enforcement and other regulatory reforms. The estimated net savings in the overall plan are around $300 billion at the federal level over the next decade (2014 – 2023). After gradual implementation of the proposed reforms over the coming decade, long-term savings from better care and sustainable spending growth will exceed $1 trillion over 20 years. While this framework focuses on lower costs through supporting reforms in health care delivery, it can be combined with other reforms to achieve additional reductions in health care costs.Funding Of Healthcare/ Reimbursement Issues Essay Paper

The report recognizes that we live in a time of unprecedented breakthroughs in genomics, systems biology, and other biomedical sciences that are leading to better prevention and to innovative combinations of treatments based increasingly on each person’s characteristics and preferences. Furthermore, improvements in wireless technologies and other non-medical technologies make it possible to prevent complications, and deliver care at home and in other settings different from traditional medical care. To take advantage of these opportunities to improve care, health care financing must shift away from paying on a fee- for- service basis for specific medical services, and toward paying for coordinated care that meets each patient’s needs.Funding Of Healthcare/ Reimbursement Issues Essay Paper

The six major government health care programs—Medicare, Medicaid, the State Children’s Health Insurance Program (SCHIP), the Department of Defense TRICARE and TRICARE for Life programs (DOD TRICARE), the Veterans Health Administration (VHA) program, and the Indian Health Service (IHS) program—provide health care services to about one-third of Americans. The federal government has a responsibility to ensure that the more than $500 billion invested annually in these programs is used wisely to reduce the burden of illness, injury, and disability and to improve the health and functioning of the population. It is imperative that the federal government exercise strong leadership in addressing serious shortcomings in the safety and quality of health care in the United States.Funding Of Healthcare/ Reimbursement Issues Essay Paper

At present, most US physicians are in solo practice or belong to small, single specialty partnerships, but new social and economic forces are beginning to make employment in large multispecialty groups a more attractive option. About a quarter of all US practitioners are now employed in such groups, which are being formed by independent physician organisations and by hospitals. If their number continues to increase and if they eventually represent the great majority of practising physicians, a wave of legislative reforms could be initiated that transforms our currently dysfunctional healthcare system. But before I say more about this move towards group practice and how it might improve prospects for reform, readers need to understand how and why our health system Funding Of Healthcare/ Reimbursement Issues Essay Paper

Some people are eligible for both Medicaid and Medicare. Currently, 8.3 million people have both types of cover, including over 17 percent of Medicaid enrollees. Seniors with a low income and people with disabilities may be eligible for both.

According to the 2014 Tennessee Department of Health Joint Annual Report of Hospitals, the average Tennessee not-for-profit acute-care hospital received 42 percent of its net revenue from commercial payers.6 Combining this with the reduction of government net revenue results in a loss of 90 percent of the average hospital’s net revenue. No organization can survive such a catastrophic loss of revenue. Again, over the longer term, it may be possible to renegotiate commercial payer contracts to substitute Joint Commission or other certification for Medicare, but the hospital would be faced with accomplishing this in a matter of days not years. As more insurers move into Medicare Advantage or Managed Medicaid programs, even this longer term solution is disappearing. Insurers typically negotiate a base agreement with a hospital that has addendums that address the specific plans. Those base agreements need to be flexible enough to encompass all specific plans to include Medicare Advantage and Managed Medicaid. Not requiring Medicare certification would make it impossible to contract with the hospital for those government-funded plans the insurer wishes to market in the hospital’s service area.Funding Of Healthcare/ Reimbursement Issues Essay Paper

The Role Of Health Insurance

The role of health insurance is central to the delivery of health care and to the conflict among these three goals.Health insurance reduces patients’ financial burden at the time of care and therefore reduces the deprivation of care that would otherwise be caused by inability to pay. But health insurance also leads to excessive spending, because patients do not face the full cost of care at the time that decisions on health spending are made. The controls that are often imposed to limit these costs interfere with the health care system’s ability to reflect the varying tastes of individual patients.

The central role of insurance reflects the very skewed distribution of health care spending among households. Although most families use a relatively small amount of health services in a typical year, a small fraction of families experience one or more spells in the hospital and therefore use very costly health care. For most such people, the high cost of health care cannot be predicted in advance. This leads to the use of insurance (or some other form of prepayment) to finance such bills.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Insulating patients from true costs. An important feature of health insurance is that it drives a wedge between the cost of producing care and the cost to the patient at the time care is rendered. Since health insurance means that patients generally pay only a small fraction of the cost of the care at the time they receive the care, patients naturally want a much higher level of spending than they would if they were not insured. This is true even for moderate health events and for affluent people. Health insurance raises health care spending not because itmakes it possible for people to pay large health care bills (although it does that) but because it reduces the cost of health services relative to other goods and services that people consume.

So the widespread use of insurance is desirable because of the financial risks that result from the inherently skewed distribution of total costs per patient. But insurance is also damaging because it leads patients and their doctors to choose excessive levels of care that is, to increase spending to a level at which the last dollar’s worth of care costs much more to produce than the value of that care to the patient’s health. It is natural, therefore, to ask: What design of health insurance would best balance these two effects?Funding Of Healthcare/ Reimbursement Issues Essay Paper

The uninsured. The financing of health care is also complicated by the fact that many Americans now have no health insurance. Because we as a society do not want people to go without care because they cannot afford it, the government steps in to provide free care for large groups of the population and to subsidize insurance for many others. What form should that government intervention take, in light of the three goals?

Emerging technologies. A new problem for health care finance is emerging because of the breakthroughs in pharmacology and biogenetics. The resulting new drugs make it possible, but sometimes very expensive, to treat some diseases that were previously not treatable or not treatable with as high a probability of success. Should private insurance cover such expensive treatments? Should such coverage be mandatory? If it is not, should the government pay the bill?Funding Of Healthcare/ Reimbursement Issues Essay Paper

The goal of preventing the deprivation of care because of an inability to pay does not mean that care must be free for all. Although having free care would achieve that goal, it would conflict strongly with the goal of avoiding wasteful spending.

Fortunately, most people can pay small and medium-size health care bills without any financial stress. It is the very large bills that can be a barrier to care for many people and a serious financial burden. That is why health insurance especially some form of major-risk insurance makes sense. (The special problems of reforming Medicare and Medicaid for the aged and indigent lie beyond the scope of this paper.)Funding Of Healthcare/ Reimbursement Issues Essay Paper

Even the extremely expensive care for some forms of cancer and certain other diseases that have been made possible by new forms of drug therapy is sufficiently rare that the insurance premiums required to pay for the actuarially expected cost of such care is not likely to be large relative to individuals’ incomes. A treatment that costs $100,000 but that is medically useful for only one insured person in 100,000 per year only increases the actuarial cost and therefore the needed insurance premium by one dollar per person per year. Such high costs of treatment appear in news stories when the individual’s insurance policy does not cover these expenses, despite the low actuarial cost of doing so.

Pharmaceutical research is, of course, likely to increase the number of diseases that can be treated effectively but at high expense, adding to these actuarial costs. But at the same time, that research is working on developing ways to identify which patients can benefit from each type of treatment. These developments in targeted pharmacology will reduce the number of ineffective treatments and will thus reduce the cost of insurance. Targeted pharmacology should also reduce the cost of drug development (by reducing the sizes of the samples needed to prove efficacy), thus lowering the cost of the drugs themselves.Funding Of Healthcare/ Reimbursement Issues Essay Paper

But there will inevitably be treatments that are very expensive and yet have a low probability of success. Avoiding deprivation of care because of inability to pay does not mean providing every possible treatment, regardless of how low the probability of success. When the cost of treatment is very high relative to the likely benefit, there would be general agreement that the cost of such treatment would violate the second goal (avoiding wasteful spending).

Moreover, individuals differ in their willingness to pay through insurance for treatments that have a very low probability of success, even if the incremental premium is relatively low. That’s why it is important to allow care to reflect differences among individuals in preferences, a subject to which I return below.Funding Of Healthcare/ Reimbursement Issues Essay Paper

Second Goal: Avoiding Wasteful Spending

There is widespread concern about the fact that health care spending has increased much more rapidly than gross domestic product (GDP) or personal incomes. It is important, however, to recognize that this rise in health care spending is not the same as an increase in the price of health care. The important difference is that the increase is for spending on new types of care, not higher prices for old types of care. Treatments have changed and become more effective. For many conditions, the cost of effective treatment has actually gone down because treatments are now more likely to be successful, because hospitalization has become unnecessary, or because hospital stays have shortened. And even for those conditions for which the cost of success has gone up, I would much rather be a patient now than ten or twenty years ago.

To some, telemedicine and telehealth are the face of the future of healthcare. To others, telemedicine and telehealth represent the end of personal medicine, where face-to-face appointments are being replaced by impersonal video chats. Multiple concerns have been raised, including questions about quality of care, security, costs, liability, licensing, reimbursements, training, and the fate of rural hospitals.Funding Of Healthcare/ Reimbursement Issues Essay Paper

To debate the merits and pitfalls of telemedicine and telehealth, two leading experts in the field came together for a discussion on different topics surrounding telemedicine. Judd E. Hollander, MD, is a professor of emergency medicine and the associate dean for strategic health initiatives at the Sidney Kimmel Medical College at Thomas Jefferson University. He is leading the enterprise-wide telemedicine initiative at Thomas Jefferson, and he took the “pro” side of this argument. Charles R. Doarn, MBA, is a research professor in family and community medicine and is the director of the Telemedicine and e-Health Program at the University of Cincinnati. He is also one of the editors-in-chief of the Telemedicine and e-Health journal and serves as the managing editor of the journal Soft Robotics. He served as the representative to the “con” side, or counterpoint, of the argument. While both are invested in telemedicine, they recognize that there are risks and benefits to the implementation of new technology. Funding Of Healthcare/ Reimbursement Issues Essay Paper

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