Provider Payments: Volume versus Improved Health Outcomes
Traditionally, providers have been paid by volume, which means being paid for each patient that they treat and each service that they provide. However, the trend of paying for positive health outcomes is becoming more popular. Providers still need to be paid for their volume of treatment because sometimes there is nothing they can do to keep a patient healthy. Providers should be paid a minimum volume fee with higher fees for improved patient outcome.
Health outcomes can be measured a variety of ways and most of them are contingent on the condition or injury that is being treated (Porterfield et al., 2015). For example, positive outcomes for obesity can be measured by tracking the patients weight loss. No matter what the disease or trauma, positive health outcomes must be, “specific, observable, and measurable characteristics or changes,” (Porterfield et al., 2015 p 2).
The Administrative Cost of Health Care Delivery
The current administrative cost of health care delivery accounts 31% of health care spending. Part of the cost is due to the high volume of paperwork that needs to be completed in order to comply with government health programs and private insurance companies. (Woolhandler, 2003). Providers often need a large clerical staff, and they also need to pay for office space for the clerical staff.
Reducing the Administrative Burden
Recent studies show that much of the clerical workday, up to 50%, is spent interacting with insurance providers (How Health Care Reform Can Lower the Costs of Insurance Administration, 2009). Insurance companies should be required to provide almost any procedure recommended by the provider. That would greatly reduce the time spent making sure that each procedure and medication is allowed under the policy.
How Health Care Reform Can Lower the Costs of Insurance Administration. (2009). Medical Benefits, 26(19), 4-5.
Porterfield, D. S., Rogers, T., Glasgow, L. M., & Beitsch, L. M. (2015). Measuring public healthpractice and outcomes in chronic disease: a call for coordination. American Journal Of Public Health, 105 Suppl 2S180-S188
Woolhandler, S. (2003). Costs of Health Care Administration In the United States and Canada. Medical Benefits, 20(18), 2-3.