Healthcare Management Capstone- Unit 2 Individual Project

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Feb 20, 2024

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1 Reimbursement Methodologies Khadijah C. Rojas Colorado Technical University HSS491 Healthcare Management Capstone Prof. Teresa Thomas Date: 11/6/2022 HSS491 061222/ttb

2 Reimbursement Methodologies Various payment methods have been used for healthcare reimbursement, with varied degrees of success. It is essential that the systems that come from the employment of each of these mechanisms, individually or in combination, compensate according to the volume, complexity, and caliber of care delivered. In addition to increasing the accuracy and efficiency of the reimbursement mechanisms, expanding the use of the electronic medical record (EMR) to monitor provider practice, patient response, and healthcare organization operations may help improve the standard of medical treatment. Three common reimbursement methods used by health care providers and organizations are the capitation method, fee-for service method, and the bundled payment method. Reimbursement Methods Under the Capitation reimbursement method, healthcare professionals are paid a set amount per patient (Nelson, 2021) . The providers that are compensated using the capitation mechanism receive regular monthly payments in addition to regular patient allocations. Whether or not the patient sessions are used is a factor in the payout. Because the suppliers know the monthly fee for each enrollee, they are unable to demand additional payments if the price rises over the payment. Due to the reimbursement system, doctors are more inclined to advise patients to take preventative measures and pay close attention to reducing the number of trips they could require. Under the Fee-for service method, medical health care organizations, as well as providers, are compensated for each service and test they perform to a patient. This means that every test and every procedure is paid for by the healthcare organizations and providers. Contrary to medical professionals and organizations covered by capitation, under payment for service, there is no incentive to promote preventative measures or avoid expensive procedures HSS491 061222/ttb

3 and testing. Under the bundled payment, the healthcare providers are compensated for the specific health care episodes, such as inpatient hospital stays (LaPointe, 2016) . This reimbursement approach encourages effectiveness and high standards of treatment and service. This is so that you can pay for the entire treatment episode with the predetermined amount of money. According to this method, the healthcare professionals are compensated for their care and attention of the patient's condition throughout the entire course of treatment. This covers the tools of support, the methods, the evaluations, the medications, and the equipment. Method used for Facility In a primary care facility, the best reimbursement method to use is the Fee-for service payment method. This method is known to be the most traditional method used throughout the healthcare system. Under this model, providers are reimbursed based on how many services and procedures provided to their patients. In primary care facilities, many services are provided. This includes physicals, point of care testing, patient consultations, and any in clinic procedures provided. Pros and Cons The fee-for-service health plan was the prevalent kind of health insurance prior to the value-based care movement (Rice, 2021) . Fee-for service coverage, sometimes known as indemnity plans, is the most expensive; nevertheless, for those who can afford it, a fee-for- service health plan offers total independence and flexibility. Fee-for service plans lets patients to choose their doctors and hospitals at their discretion, with little interference from the insurance company. A fee-for-service health plan necessitates significant out-of-pocket costs since customers might be asked to pay for their medical care up front and submit receipts for reimbursement. Patients receive excellent care, and the provider can make the right suggestions. HSS491 061222/ttb

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