November 18, 2013
University of Phoenix
Financing health care is one of the many issues that consumers have with health care in the United States. Therefore, paying for health care is a very intense issue in health care. The ability to finance health care allows the ability to receive health care services. Without health care services many health care consumers would find it hard to live or find their life expectancy shortened. Hence, the importance of the correlation of finance and health care. There are different options consumers have to finance healthcare. Health care insurance is usually the way that many people are afforded to pay for health care. Health insurance allows the providers of health care services to be reimbursed for any services that they deliver. Financing has a prodigious influence on how the structure of health care is revolutionized and how health care is delivered to consumers. There are several reimbursement payment methods that allow providers to get paid for the services the provider gives. Possessing the ability to have different payment methods allows for consumers to receive the best health care services available. Pay-for Performance (P4P) is an example of how reimbursement is changing the quality of health care a consumer receives. What is Pay-for-Performance?
“Pay-for-Performance is a reimbursement plan that links payment to quality and efficiency as an incentive to improve the quality of health care and to reduce costs” (Shi & Singh, 2012, p. 586). Pay-for-performance is known by many names such as merit pay, performance related pay, P4P, or PFP. Pay-for-performance is an budding movement in health financing that has been around since the early 2000’s. However, it has seen a surge in popularity due to Affordable Care Act. The proposals within the act entail that providers who participate in Medicare engage in events that will evolve to pay-for-performance over the course of the next three to four years. Pay-for-performance comprises the idea that providers should be paid for health care services based on the quality of the service that they provide. The idea is that by creating payment to providers to depend on quality of service, consumers will get better care and health care results will improve over time. Pay-for-performance is projected to enhance the delivery of the quality of health care and reduce the health care costs over a prolonged time. Therefore, reimbursement is made to the providers or doctors that can give the best care to consumers. How reimbursement is affected by the pay-for- performance approach?
Reimbursement for a provider’s health care service would rely specifically on improving the quality of heath care, efficiency, and overall value of health care. The criteria that providers would have to follow would be the providers guiding pay scale. This would majorly affect how health care services were administered. Many other payment reimbursements do not reimburse for the health care services but pay healthcare providers. Pay-for-performance does not pay for what the doctors do. Pay-for-performance pays for how well the provider deliverer the service. The providers have a list of criteria that they know in advance that they have to meet to receive those payments. Also, pay-for-performance systems can also impose financial punishments to providers that fail to accomplish goals or cost savings. According to Health Affairs, (October 2012), “The quality measures used in pay-for-performance generally fall into the following four categories: (1) Processes, (2) outcomes, (3) patient experience, and (4) Structure” (p. 2). Thus, each provider using pay-for-performance systems would have to follow the guidelines that encompass the four categories to get any financial retribution. Reimbursement is going to be very different than what it was years ago. Providers will put more effort into the care that they...
References: Health Affairs. (October 2012). Health policy brief: pay-for-performance. Retrieved from
Mathematica Policy Research Inc. and the Center for Studying Health System Change. (2009).
Pay-for-performance. Princeton, NJ: Mathematica Inc. Retrieved from http://www.mass.gov/chia/docs/pc/2009-02-13-pay-for-performance-c3.pdf
Shi, L., & Singh, D. A. (2012). Delivering health care in america: a systems approach (5th ed.).
Burlington, MA: Jones & Bartlett Learning.
Wikipedia. (2013). Pay for performance (healthcare). Retrieved from
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