When responding to your classmates, explain whether you agree or disagree with their conclusions about the best process from a patient’s perspective.
Post #1 :
Hi Everyone. I am working on the Master of Science in Healthcare Administration here at SNHU. I am married with a wonderful adult daughter, a cat, and a dog. We are from Michigan and have been residing in Maine for the last five years. By trade, I am a Radiation Therapist, and a Radiologic Technologist (X-ray tech) and I have worked in healhcare for more then 25 years.
The retrospective reimbursement methodology and the prospective reimbursement methodology are different as to who benefits from them which made me decide to chose one type of reimbursement from each of those methodologies. The global payment reimbursement is a type of the prospective reimbursement methodology which is more advantageous to the third party payer than it is to patients and providers. The global payment reimbursement is where the third party payer makes one combined payment to cover the services of multiple providers and NO higher payments are provided when more complex, more expensive services, or even when a higher volume of services are provided. (Castro, 2018) This type of reimbursement encourages providers to do less on every level- less patients, less complex procedures, less expensive procedures, less expensive diagnostic tests, and less expensive treatments which is terrible for quality patient care and makes providers have to make tough decisions between quality of care and financial stability!!!
The retrospective reimbursement methodology is the fee schedule type of reimbursement and this type is more advantageous to the patients and the providers. Fee schedule reimbursement is where a predetermined set of fees that the third party payer allows which is known as the “allowable charge” represents the average or maximum amount that they will pay. These fees are set in advance. (Castro, 2018) This is better for the patient because this lets providers decide the appropriate services for each patient without considering financial impacts. This is vitally important for quality patient care.
Castro, A.B. (2018) Principles of healthcare reimbursement. American Health Information Management Association. Chicago, IL. ISBN: 978-1-58426-646-4
Post # 2
My name is Christen and I live outside of Philadelphia. I enjoy spending time with family, friends, and my amazing dog (Marley). I like to travel and be exposed to new and adventurous places. Professionally, I graduated with my BS in Clinical Psychology in 2004. I have been working in the field of mental health ever since. Currently, I am employed as the Executive Director of Assessment and Referral, overseeing admissions for two inpatient psychiatric hospitals. This position has allowed me to dive into hospital administration, as I am on the senior leadership team at both hospitals. A critical part of hospital administration is understanding the importance of healthcare finance and reimbursement. In my current role, I must ensure that my team obtains insurance pre-authorization for patients prior to them being admitted to our facility. Having an understanding of co-pays, Medicaid rates, and single-case agreement fees is a part of my daily work life. On a larger scale, I am responsible for understanding the finances and costs of hospital operations. This includes a budget allocation for staffing and departmental supplies. Although we are all facing very difficult times in our healthcare professions, I am looking forward to navigating this course with everyone. For this initial discussion post, the two methods of reimbursement that I chose to investigate are fee-for-service and episode-of-care.
Fee-for-service, also known as fee schedule, is healthcare’s most traditional payment model where physicians and healthcare providers are paid by government agencies and insurance companies, or individuals, based on the number of services provided, or the number of procedures ordered (Hodgin, 2018). From an administration standpoint, this is a great way to get financial reimbursement, as the hospital is able to bill for individual services. For example, if a patient goes to his/her primary care physician for an appointment and is ordered to go to the lab for lab work and to the hospital to get a CT scan, the hospital can bill for three individual services. There are also advantages for patients who utilize this reimbursement model. Pros of fee-for-service reimbursement include patients always receiving access to the care they require, allowance of patients to decide what treatment they want as there are no stipulations in place, access to an unlimited choice of non-experimental treatments encourages the maximum number of patient visits, and offers flexibility in care structure that offers few limitations (Gaille, 2020). With advantages come disadvantages. Gaille (2020) notes that some of these disadvantages include fee-for-service resulting in the denial of care for some people, indemnity insurance being more expensive than any other coverage plan, additional required paperwork for management of fee-for-service, patients being required to pay for costs upfront, and that fee-for-service does not typically cover preventative benefits.
In contrast to traditional fee-for-service reimbursement, where providers are paid separately for each service, an episode-of-care payment covers all the care a patient receives in the course of treatment for a specific illness, condition or medical event (“Episode of Care,” 2018). Episode-of-care reimbursement is also known as bundled payment reimbursement. Bundled payments are starkly different from fee-for-service, as reimbursement is provided collectively to providers instead of being itemized per service. For example, if a patient has surgery, a bundled reimbursement would pay out a pre-determined amount collectively to all providers involved. The surgeon, anesthesiologist, nursing staff, and medication costs would be included in the bundled payment. Episode-based-payment is the fusion of Medicare Part A and B services, with one payment going to the contracting entity that represents the integrated care cooperative with that payment then disbursed amongst the cooperative’s members including the hospital, physician group, or home health agency (“Episode of Care Explained,” 2010). If billed under fee-for-service, multiple payments would be required with providers/services being itemized and charged separately. Taking this into consideration, bundled payments can be a disadvantage for providers. If the cost is less than the bundled payment set price, the providers can keep the difference, but if the cost is more, participating providers will lose the difference (LaPointe, 2016).
From a patient perspective, I think that fee-for-service is more cost-effective and beneficial. Fee-for-service ensures that patients are only being charged for what services they receive. As a result, providers are more likely to see patients more frequently and increase the number of appointments that can be offered. Patients can see itemized services on their bills and know exactly what each service cost. However, if healthcare costs continue to increase, fee-for-service may no longer be the most beneficial option.
Episode of Care or Bundled Payments- Health Cost Containment. (2018). Retrieved from https://www.ncsl.org/research/health/episode-of-care-payments-health.aspx
Episode of Care Explained. (2010). Retrieved from file:///C:/Users/christen.karch/Downloads/CORP%20CSS%20Episode%20of%20Care%202010.pdf
Gaille, L. (2020). 17 fee for service pros and cons. Retrieved from https://vittana.org/17-fee-for-service-pros-and-cons
Hodgin, S. (2018). What is fee-for-service? Retrieved from http://www.insight-txcin.org/post/what-is-fee-for-service
LaPointe, J. (2016). Understanding the basics of bundled payments in healthcare. Retrieved from https://revcycleintelligence.com/news/understanding-the-basics-of-bundled-payments-in-healthcare