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Pros And Cons Of Insurance Reimbursement

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There is an increase in healthcare spending in the United States. In 2014, about one of every five dollars or nearly $3 trillion dollars was spent on health. At the current rate, it is estimated that in 2020, the US will spend $13,710 per person and 20% of GDP on healthcare. In efforts to provide greater health care coverage, recent healthcare legislation (Affordable Care Act) guidelines changes insurance reimbursement for providers. Through the Medicaid expansion and change in insured demographics, cost shift, a change in consumer coverage from private health insurance to Medicaid, a lower reimbursement rate, occurs. This results in health care providers receiving a lower average rate of reimbursement per patient. In addition to reduced …show more content…

This is known as the Bundled Payments for Care Improvement (BPCI) initiative. The goal of this initiative developed by the Center for Medicare and Medicaid Innovation is collaboration from providers across various specialties and settings. Through this initiative, CMS sets the target price for the episode at 2% to 3% less than the mean adjusted amount that Medicare spends per each beneficiary for the diagnoses related group (DRG). The BCPI initiative provides four model options. The first model provides retrospective reimbursement based on inpatient prospective payment system. The second model provides retrospective reimbursement passed on care episodes of extended set times (1, 2, or 3 months) post discharge from hospital; the third model provides payments associated with post acute care episodes following discharge from hospital; and the fourth model offers prospective payments which include all services provided during hospitalization and includes all 30-day readmissions. These Bundled Payment Plans enable providers to focus on providing more effective care that focuses on patient outcomes and research, with the awareness that a standard required care be provided within a set allotment, rather than reimbursement based on quantity of services provided, or certain billing code, as currently

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Legal RRMC’s external stakeholders consist of the community, patients, MedKey System members, CMS, HMOs and any other private insurances” (Richards & Slovensky, 2004). “One of the major constant struggles RRMC’s hospital administrators were facing was the low Medicare reimbursement rates and trying to operate the facility on such low reimbursements for their services which definitely became a significant external threat to the organization”(Richards & Slovensky, 2004). Eighty percent of patients at RRMC were Medicare or Blue Cross and the administration experienced much difficulty when it came to negotiating prices with Blue Cross due to monopoly”(Richards & Slovensky, 2004). In this market, buyers have high bargaining power because reimbursements

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Bundle payments are set up for multiple services from four different care link payments that are arranged that are financially accountable. The services are consisted of higher quality and could lead to lower cost

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A key part of Oregon's complex system of Medicaid reimbursement is a "provider tax" big hospitals pay the state. Davidson's group currently gets paid both by the state and by the large hospitals to help administer that tax. Here's how it works: The state's 28 largest hospitals levy a 5.3 percent tax on net patient revenues. That tax generates about $550 million a year. The hospitals pay that tax to the Oregon Health Authority, which oversees the state's Medicaid programs.

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The Medicare Physician Fee Schedule (MPFS) uses a resource-based relative value system (RBRVS) that assigns a relative value to current procedural terminology (CPT) codes that are developed and copyrighted by the American Medical Association (AMA) with input from representatives of health care professional associations and societies, including ASHA. The relative weighting factor (relative value unit or RVU) is derived from a resource-based relative value scale. The components of the RBRVS for each procedure are the (a) professional component (i.e., work as expressed in the amount of time, technical skill, physical effort, stress, and judgment for the procedure required of physicians and certain other practitioners); (b) technical component

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833 Words | 4 Pages

This will help the part of the community who are unable to afford the pricey health care costs. The federal government provides tax credits based on one’s income in relation to the poverty line by 4 times. While many state’s government expanded Medicaid coverage to people earning up to 133% of the poverty threshold. A new insurance market reform discusses the “medical cost ratio” requiring the insurance agencies to spend a minimum of 80% of premiums collected on patient care. However, if insurance payments result in less than 80%, a rebate must be provided.

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These low-income adults in the coverage gap are usually uninsured and are paying their medical expenses out-of-pocket. However, people in expansion states have benefited tremendously from their new coverage. []Medicaid expansion states have seen an increase in diabetes diagnoses

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In achieving this, the ACA made provisions, investments, and funding opportunities. These provisions allow for more innovations in Medicaid programs including the application of models like patient-centred medical homes which allows for preventive and primary care, increased care for beneficiaries with complex needs, and provided financial incentives for high performance.3 For example, with full federal funding, one ACA provision required that Medicaid programs in every state pay primary care physicians at Medicare rates (a substantial increase in many states) for 2 years.4 Also, as provided by states, one improvement to Medicaid Benefits is the provision of home and community health care for individuals with

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In the year 2015, Medicare Access and Chip Re-Authorization Act (MACRA) have made a lot changes in the Medicare pays for physician services. Indeed, the Medicare Access and Chip Re-Authorization act terminating the sustainable growth rate and from the year 2015 to 2025 the Medicare Access and Chip Re-Authorization Act is providing the physicians the stable and sometimes flat updated payment to the Medicare Physicians. Moreover, from the year 2026 completely it’s a different scenario as physicians will be receiving a different annual update as they will be paid under the new Merit based Incentive Program system with 0.25 % under the MIPS. Additionally, the Merit based Incentive Program system is indeed based on the fee-for-service model which makes to tie with the quality of performance by the physician.

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Pay-for-Performance in Nursing Homes Pay for performance is a type of provider reimbursement system where the healthcare network of providers is incentivized for maintaining quality measures and standards in the treatment of their patients. Most of the times these incentives are monetary in nature. This type of payment strategy is relatively new in healthcare. This holds true even more in the case of nursing homes as compared to hospitals and health provider offices. One reason out of many, I believe is that the nursing homes are mostly state funded and have less leverage of experimentation in their operations.

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This system is the primary cause of cost shifting, since the introduction of Medicaid and Medicare. The cost of healthcare increases every year, without government stimulus the revenue will keep declining. Since the introduction of the ACA coverage expansion, new questions were raising as to what would happened to the methods of reimbursements. Unfortunately, the ACA will be finance in part by reducing payments to hospitals and any other healthcare practitioners, according to Shi, L., & Singh, D. (2012). Therefore, cost-shifting practices will continue, leading private insurance to pay for the short revenue of hospitals and health

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Employers within the private sectors are proclaimed to be key drivers in regard to the changes that have occurred in the healthcare system. These employers have learned how to shift the purchasing power of paying for open ended fee for service health coverage benefit to purchasing health care, on a capitulated basis, from plans where the care was managed. The amount of employees in the private sector that are enrolled in a form of managed care has grown from 29% in 1988 to around 70% in 1995.(Cite) Employers now believe that there is better chance of saving without altering the quality of care given. Employers now have an expectation that instead of an increase in premiums, the cost of managed care plans fall or remain at moderate levels.

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The health care system is one of the greatest expense of the U.S. It has steadily increase over the years since 1965. Many policies such as the Obama care and health insurance have been implemented to help ease the cost. However, this new policy and health insurance are expensive and provide inadequate coverage. This expense has caused a negative effect on the market.

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Introduction The United States spending on healthcare soared to 3.2 trillion in 2015, when analyzed it averages out to $ 9,990 per person and it also accounted for 17.8% of Gross Domestic Product (GDP) (CMS n.d.). The growing healthcare deficit can be attributed to the increased growth of insurance coverage provided under the Affordable Care Act (ACA), rising medical cost, and most of all spending on government programs such as Medicare. Medicare is considered as one of the largest health care insurance program. In 2015, there were a total of $55,504,005 beneficiaries enrolled in Medicare plans (KFF.org).

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(AAPR, January 1st, 2011) Medicare part B is the part that pays for a portion of your doctors’ visits, medical equipment, outpatient procedures, and so on. Part B required you to pay a monthly premium to Medicare, and there is a small deductible that you must reach before Part B

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Then, the largest change since then in 2010 was the ACA. The ACA helped increase healthcare access, and required most Americans to obtain health insurance or face a tax penalty. From the very beginning, the rise in healthcare costs has been a problem, and yet as we approach 100 years from when health insurance was first introduced, there hasn’t been much change. With evolving technology, this cost is only estimated to continue to rise, and healthcare spending already takes up a large portion of our GDP. As seen in a chart from Tarik Sammour’s TED Talk, America spends a larger amount of its GDP on healthcare than other countries (2).

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