Reforming Physician Payment Report of a Conference (1984) / Chapter Skim
Currently Skimming:
Third Party Carrier Perspective on Physician Payment
Third Party Carrier Perspective on Physician Payment
Pages 63-74
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From page 63... ...
Given these goals and these limitations, the approaches to the design of a carrier's physician payment system are governed by a number of principles that may be summarized and explained here: Payment Is A Means, Not An End A Payment System Must Proceed Toward Specific Objectives In the private market there are five parties at interest, each pursuing objectives that are reasonable and legitimate, but different. Thus, payment always takes place in the context of conf licting objectives.
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From page 64... ...
The Pub 1 ic The publ ic expresses itself not only as a buyer of health insurance but also through regulatory and legislative processes. Regulatory activity has two thrusts: The state insurance department is interested in protecting the public from being misled, treated unfairly, overcharged for a particular set of benef its, or victimized by default.
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From page 65... ...
Economic factors influencing physician behavior may include: Specialization Return on investment of time and money; education to a broader variety of treatment alternatives. Locat ion Cost of doing business; economic capability of patients; social and economic goals of the practitioner.
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From page 66... ...
Thus lengths of stay and use of ancillary services are influenced by patterns learned during undergraduate and postgraduate training. Fear of external control is still another influence; an example is the AMA Council on Medical Service Report D ~ June 1983 ~ suggesting that physicians deal only with patients on charge issues, and that the relationship between carrier payments and physician charges be severed.
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From page 67... ...
In practice, many carriers do not have sufficient market penetration or data to establish and maintain usual fee profiles. This can be a major weakness in purported OCR programs.
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From page 68... ...
It is vulnerable to collusion, however, particularly in the smaller specialties, and to the effects of probing for the limits. The Blue Cross and Blue Shield Association, for example, has adopted a membership standard requiring controls on the customary range.
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From page 69... ...
Diagnosis Related Groups represent the opposite extreme, conveying little information except diagnosis and price. In current practice, carriers attempt to adopt coding sufficient to identify real differences in payment value or benefit coverage without weakening price and utilizaton prof lies more than necessary.
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From page 70... ...
Once the carrier establishes its payment levels, it may vigorously defend them. Blue Shield Plan participating contracts, for example, obligate the physician to accept Plan payments as payment in full.
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From page 71... ...
The physician contracts to accept assignments on all cases, or he receives assignment on none. Non-price incentives include direct payment to the physician, simplifying his billing; prompt payment; avoidance of bad debts on covered services; a predictable cash flow; access, in some Plans, to paperless processing; an improved competitive position or referrals; services of a field staff in the handling of problem claims, and improved patient relations.
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From page 72... ...
For example, it is extremely difficult to have a patient discharged in six days if the company' s disability program requires seven days of hospitalization for eligibility. Medical Policy Refusal to pay for routine laboratory and x-ray work, without specific indication, upon admission to a hospital, will, for example, have a perceptible effect on service charged to the carr ier.
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From page 73... ...
Indemnity offers free-choice and premium containment, although it does not necessarily contain costs for the individual patient. Most full payment programs offer both freedom of choice and payment in full, although this may be achieved by paying billed charges.
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From page 74... ...
) preadmission certification, and similar approaches can be implemented only with the cooperation and support of the buyer.
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