Essay Example on Rising Cost of Healthcare: The Need for Innovative Solutions

Introduction

In the recent past, there has been a rise in the cost of healthcare, and that has led to a squeeze in financing. This calls for the administrative forces to join hands and develop innovative ways to deliver efficient and equitable healthcare services. However, the attempts to provide quick and effective services are integrally complicated and highly depends on a sophisticated procedure of measuring the probabilities of disease and encouraging the anticipated conduct by all healthcare givers and patients (Elton, & O'Riordan, 2016). Just like any other business, health caregivers are influenced to somewhat extent by their payment methods. It is also notable that non-financial incentives also play a significant role in designing the desired behavior. Insofar as a method of remuneration, impacts the practice (Miller et al., 2017). The design them so that the incentives created must be aligned with the system goals in healthcare.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

There are three primary payment methods of payment to any physician. The plans include; fee-for-service, capitation, and salary. Every mode of payment is considered to have its pros and cons. Many jurisdictions have blended and even juggled between the three basic payment models for better outcomes (Elton, & O'Riordan, 2016). It becomes a responsibility for the institution to come up with the ideal modes of payment to address the physicians' needs and productivity. Other entities have tried coming up with payment methods such as pay for performance denoted as P4P, in an attempt to improve and promote healthcare quality through payment methods.

All the attempts are designed to discuss healthcare interventions and improvements. The discussions will not fail to mention physician remuneration. While on the compensations of physicians, quality becomes a hard term to define as it all involves different stakeholders and also the perspective. From a patient's point of view, quality could mean waitlist times, impartiality in access, care continuity, or satisfaction from a visit. From a caregiver's point of view, quality would be completely different from the patients. It could merely be the result of a diagnosis, professionalism, and autonomy in the industry, or satisfaction in practice. From a general healthcare system perspective, quality could be shallowed down to appropriateness of a service given and again as a business in budget control (Siddiqi et al., 2017).

In American healthcare systems, there are various ways healthcare providers are paid, and there are multiple discussions regarding the same. The interesting one for this assignment is on how the doctors are paid (Siddiqi et al., 2017). Some of the questions that revolve around remuneration are; do doctors get paid more than they deserve? Is the amount paid to them equate to the unnecessary procedures they take? Do the doctors get reluctant to give the necessary attention to patients due to their pay? Why can't the doctors be content with the salaries just like other entrepreneurs in a business? And finally, why do reimbursement procedures have to be so complex and complicated? In the healthcare system setting, any healthcare provider is supposed to be cost-effective regarding the patient (Anoushiravani & Iorio, 2016).

However, there never lacks a healthcare provider who is selfish and only pursues the course for self-gains. What causes the antagonism is that there are no cut-off points from the governing bodies where there comes a middle point of charging the clients (Anoushiravani & Iorio, 2016). There is also a combination of diseases, different magnitudes of infections, and this happens in severe and mild symptoms. The physician could be torn in a dilemma, especially in terms of cost-effectiveness to the patient. For instance, if a patient visits a physician with unclear symptoms, the physician would consider doing multiple tests or come with a wait and see a process where the symptoms will be more pronounced to establish the actual course and diagnose the appropriate procedure (Siddiqi et al., 2017). This calls for the physician to have an honest and open conversation with the patient regarding the various options available. The discussions would involve the medical history, cost/benefits tradeoffs, and the available options regarding the same ailment. The objective of a sound reimbursement provider structure would more simply convenient and never come in the way while the physician and the patients are making decisions regarding the ideal service to be provided in a given time. Below are the remuneration structures for institutions.

Fee-For-Service

As the name suggests, the fee-for-service system rewards the physicians for every single service provided. This means the physician's income is directly proportional to the number of health care services offered (Miller et al., 2017). It was thus creating an incentive to serve more in the healthcare sector because all of the financial risks are regarding the more activities carried out are not on the physician's side but instead on the payer's side. Since there are motivations for the physician to provide large amounts of services, it becomes the physician's responsibility to focus on the patient's satisfaction, which ultimately results in patient retention. On the other hand, the system can treat the patients equally, creating equal incentives to accept the high cost and relatively low-cost patients. The unfortunate thing is that such benefits are not present in other models of payment, which makes the initiative of FFS to outstand (Miller et al., 2017). The FFS system is modeled in a way where there are group practices that bring along diversity, self-sufficiency, and entrepreneurial openings. By the structure of FFS that is shaped to elevate the patient's satisfaction, amount of care provided, and lower the possibilities of alienating the low-cost patients, it goes without a doubt that FFS is the ideal and appropriate remuneration method (Bazemore et al., 2018). The cons are that the services provided are deemed to elevate the costs due to the massive services offered.

Capitation

Capitation is the other remuneration method, and it means the patient's payment per patient per given period. The idea is to increase the clinical practice's sum of patients lacking direct incentives to elevate the number of activities provided by a healthcare facility. The objective is to have relatively healthy patients (Bazemore et al., 2018). The unhealthy patients will be left with no option other than seeking medical attention elsewhere, and the patient's health deteriorates. At the same time, in the facility, they are referred out. The reason for referring them out is because they will call for a higher amount if healthcare provision. For the payer, capitation is an advantage as the providers only encounter financial risks as the levels of practice.

Salary

Salaries are payment models where the employee receives as a reward after some time. This tells that time in the health care facility is the measure of payment and not in the services provided nor the number of patients. The salary payment model sounds appealing as there is a stable and constant income for the physician. Still, there is the downside as it provides an avenue to compromise the quantity of care (Bazemore et al., 2018). Salaries are an ideal method to retain, layoff, and recruit physicians, especially to sparsely populated regions. FFS and Capitation based systems on sparsely populated areas would not be suitable because they would not reward them adequately. Salaries are negotiated in advance, and the duration of work stipulated and built into contracts to maintain the healthcare goals plus productivity.

Recommendations

To enhance competence in the health care systems and desire to provide the best results, I believe value-based rewards would do significantly well in comparison to FFS, Capitation, and salaries. This is because the three models aim at serving more clients (volume). I believe that whenever one is paid for the services they offer, there is a way one is dedicated to bettering their services even more and trying their best to deliver their milestones.

References

Anoushiravani, A. A., & Iorio, R. (2016, September). Alternative payment models: from bundled payments for care improvement and comprehensive care for joint replacement to the future?. In Seminars in Arthroplasty (Vol. 27, No. 3, pp. 151-162). WB Saunders.

Bazemore, A., Phillips, R. L., Glazier, R., & Tepper, J. (2018). Advancing primary care through alternative payment models: lessons from the United States & Canada. The Journal of the American Board of Family Medicine, 31(3), 322-327.

Elton, J., & O'Riordan, A. (2016). Healthcare disrupted: Next generation business models and strategies. John Wiley & Sons.

Miller, B. F., Ross, K. M., Davis, M. M., Melek, S. P., Kathol, R., & Gordon, P. (2017). Payment reform in the patient-centered medical home: Enabling and sustaining integrated behavioral health care. American Psychologist, 72(1), 55.

Siddiqi, A., White, P. B., Mistry, J. B., Gwam, C. U., Nace, J., Mont, M. A., & Delanois, R. E. (2017). Effect of bundled payments and health care reform as alternative payment models in total joint arthroplasty: a clinical review. The Journal of arthroplasty, 32(8), 2590-2597.