PHSC 2 Lecture Notes - Lecture 11: Uwe Reinhardt, Health Maintenance Organization, Managed Care
20 Feb 2020
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Each insurance plan also has a variety of payment mechanisms. Fee for service - payment for each visit or individual services within a visit. Basic office visit vs office visit with chest x-ray. Do-more, charge more, no incentive for cost efficiency. Paid after the service has been delivered (retrospective payment) Paid a fee negotiated between the provider and insurance company. The provider determines the frequency and quantity of service, but the payer exerts oversight on the appropriateness of charges and has he right and responsibility to challenge excesses. Bundle or global payment - paying for diagnosis. Payment for a diagnosis or episode of care - based on expected cost for usual care. Used by medicare (for inpatient care) & increasingly by private insurers/ppos. Is paid after care is given and adjusted for extraordinary costs (retrospective) Creates incentive to provide cost efficient care, realize cost savings.
