Nursing 108

N108: Transition to the Registered Professional Nurse Role Study Guide unnecessary. The HMOs were the original capitated system. A criticism of a capitated system is that when the provider is at risk for providing care there may be an unconscious (or even a deliberate) attempt to deny medically necessary care to keep cost down. Pay-for-Performance (P4P) Pay-for-performance (value-based purchasing) gives financial incentives to clinicians for better health outcomes. Clinical outcomes, such as longer survival, are too difficult to measure, so pay for performance systems usually measure process outcomes, such as measuring blood pressure, lowering blood pressure, or counseling patients to stop smoking. This payment model rewards physicians, hospitals, medical groups, and other healthcare providers for meeting certain performance measures for quality and efficiency. It penalizes caregivers for poor outcomes, medical errors, or increased costs. Health Care Financing Who pays for healthcare? Some group health insurance plans collect monthly premiums before care is required by the subscriber. The insurance company invests the money until it is used to pay for healthcare. Others may offer a variety of health plans to meet the subscriber’s needs while making a profit. These questions can be asked to clarify the issues of payment for healthcare: • Who pays for care? Either the patient (who may pay directly out-of-pocket or may purchase an insurance plan) or the government. • What is paid for? The healthcare provider may be paid a fee for a specific service or the individual provider may be paid a salary. Also, the provider could be paid a fee per patient per year regardless of the number of visits the patient makes in that year (capitation). • How is the payment made? It may be paid directly (out-of-pocket by the patient) or indirectly via a third-party payer (such as insurance or government program). 2.10 Types of Healthcare Plans Fee for Service This type of payment means that each time a service is provided a fee is generated, and then billed to the care recipient. The more services provided, the more fees charged. This was the traditional method of charging for healthcare in the United States. When insurance companies began assisting with payment, the bill was sent to the insurance company and to the client. The insurance company then paid the amount established in the policy (typically 80%), and the client was required to pay the rest (typically 20%). As costs rose, insurance companies began setting a standard for reimbursement. Under this system, if a policy stated that a company reimbursed at 80%, this meant that 80% of a fee that the insurance company determined was reasonable. If the provider charged more than what was considered reasonable, the client was responsible for the excess, in addition to 20% of the reasonable fee.

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