MCCG222 - HODGES Week 3 Reimbursement Systems Report

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Apr 3, 2024

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MCCG222 – Advanced CPT and HCPCS Level II Coding Week 3 Reimbursement Systems Report This Assessment is worth 10% of your overall grade. Deadline Due by the end of Week 3 at 11:59 pm, ET. Completing this Assessment will help you to meet the following: Course Outcome  Analyze reimbursement systems and practices for various types of professional services in any healthcare setting. Directions For this Assessment, you will complete a report consisting of two parts in which you will analyze three professional reimbursement systems: Fee for Service, Capitation, and Bundled Payment. To begin, first read about these professional reimbursement systems in the articles provided below. Pros and Cons of Various Payment Models and their Effect on Practices What are Bundled Payments? Understanding the Basics of Bundled Payments in Healthcare Part I Now that you have read the articles above, use the information presented within them to complete the table below. Each column in the table represents a different reimbursement system. For each reimbursement system, provide the following:  A general definition  At least one example  At least two advantages  At least two disadvantages

MCCG222 – Reimbursement Systems Report 2 Reimbursement Systems Fee for Service Capitation Bundled Payment General Definition Specific payments for specific services A prepayment is made based on patient trends and service types Payment for everything required for one episode of care is paid in a lump sum to the hospital and dispersed by the hospital. Example(s) 1. An itemized bill for a consultation 1. Physician is paid a certain amount per patient on a set schedule 1. Payment for all services, DME, and doctors required to treat a stroke patient Advantages 1. Flexible, utilized in almost every healthcare setting 2. Encourages delivery of care and getting the most out of patient visits 1.Physician has better contract leverage with payers 2.Physician benefits directly 1. improves physician care coordination 2. Simple billing Disadvantages 1. Does not incentivize low-cost quality healthcare 2. Only face-to- face; Cannot be used for other types of visits such as telehealth. 1.Avoid patients with complex conditions who may exceed payments 2. High personal risk for physician financially if taking on more complex patients 1. Avoiding high- risk patients who could exceed average costs 2. Lack of incentive to reduce avoidable episodes Part II Once the table is complete, write at least a 500-word essay in APA format in which you will compare and contrast the three different reimbursement systems: Fee for Service, Capitation, and Bundled Payment. Be sure to support your analysis with references to the articles provided. Payment Models in Medical Billing Fee-for-service payments are a classic method used at most healthcare facilities. When you think of paying for any other service, this is essentially the idea behind a FFS payment. Once a physician completes a service for a patient, payment for that service is collected, whether made as

MCCG222 – Reimbursement Systems Report 3 a claim to an insurance company or if the bill is paid out-of-pocket by the patient. This form of payment provides flexibility in payment. If a doctor is visiting a different hospital, they can still be paid for any services provided. However, this payment method does not incentivize offering the best quality of care at the lowest price point. Capitation is a form of payment that assesses trends from patients, as well as considering the type of services being provided and makes a prepayment based on the collected data. It allots a certain amount of money for every patient expected to be seen in a set amount of time, for instance, $500 per patient per year. With this type of payment model, doctors are incentivized to keep healthcare costs low and minimize unnecessary episodes of care. The physician will also have more power when negotiating contracts with payers. A few downfalls of this model include the heavy financial burden that can befall the physician if patients who exceed the average cost are cared for, and the tendency to avoid patients who fall under that category. It can carry too much risk, which can limit the number of patients the doctor can see. The final model to discuss is the Bundled Payments model. In this model, all services (including procedures and DME) are paid in one lump sum and dispersed accordingly. Say for example a patient is hospitalized for a stroke, every specialist, test, medication, etc will be paid for all at once. After the hospital has received the reimbursement, the amounts delegated to the physicians will be given out. This model is good for several reasons. Firstly, it provides a clearer (and necessary) route of communication between physicians who are caring for the same patient. This will help to reduce avoidable errors while also maximizing the opportunity for the most quality care. They will work together to make sure they are managing the care of the patient properly, as well as minimizing needless costs. It is also a very simple form of billing; the entire episode of care just receives on payment. Each one of these models offers a few common factors. Each one compensates physicians for services and each one allows the physician some form of control over the payment amount. They can all be combined with less common payment models that will allow for all goals of the orginzation to be reached. Even with these things in common, it is easy to distinguish them to asertain which model is the best for your needs. The fee-for-service model, as mentioned above is classic. It is straight to the point but allows for physicians to charge more or less for specific services rather than going with an average. The capitation model hinges a lot of the financial burden on the physician making it less likely for that physician to care for high risk patients. Bundled payments require team work amongst physicians who may not operate in the same building which can offer up its own issues. In conclusion, understanding the fundamentals of different payment models is helpful in the world of health information. As a part of the revenue cycle they are a vital piece in maintaining the quality of care provided to patients nationwide.

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MCCG222 – Reimbursement Systems Report 4 References Medical Billers and Coders. (2015, October 7). Pros and cons of various payment models: Effect on practices . Medical Billing Services. https://www.medicalbillersandcoders.com/articles/practice- administration/pros-and-cons-of-various-payment-models-and-their- effect-on-practices.html

MCCG222 – Reimbursement Systems Report 5 MCCG222 – Reimbursement Systems Report Grading Rubric Criteria Exceeds Expectations Meets Expectations Needs Improvement Poin ts Table Content (30 points) 27 - 30 points Provides accurate answers for all 12 of the required fields in the table. 20 - 26 points Provides accurate answers for 7 to 11 of the required fields in the table. 0 – 19 points Provides accurate answers for 0 to 6 of the required fields in the table. Table Formatting (10 points) 9 - 10 points The content within the table is clear, concise, and adheres to template formatting. The visual organization of information in the cells of the table is easy to follow, with spaces or bullet points separating details. 7 – 8 points The content within the table contains a few unclear areas, and mostly adheres to template formatting. The visual organization of information in the cells in the table can be followed with minimal difficulty. Some attempt is made to separate details in each cell. 0 - 6 points The content within the table is unclear and/or does not adhere to template formatting. The visual organization of information in the cells in the table is difficult to follow. No attempt is made to separate details in each cell. Essay Content (50 points) 44 - 50 points Identifies and explains accurate similarities and differences between all three reimbursement systems. 35 - 43 points Identifies and explains accurate similarities and differences between two reimbursement systems. 0 – 34 points Fails to identify and explain similarities and differences between two reimbursement systems. Essay Formatting & Mechanics (10 points) 9 – 10 points Adheres to APA style guidelines. Provides support from references that are properly cited in APA format with no errors in in-text citations or reference list. Word count is 500 words or more. Makes minimal grammar, spelling, and punctuation errors. Errors do not distract reader or cloud meaning of the message. Writing is clear with no "text" or "chat" language. 7 – 8 points Mostly adheres to APA style guidelines. Some support is provided from references or support from scholarly references is not cited properly or there are some errors in in-text citations or reference list. Word count is between 400 and 499 words. Makes several errors grammar, spelling, and punctuation errors. Errors do not distract or cloud the meaning of the message. Some "text" or "chat" language is used. 0 – 6 points Does not adhere to APA style guidelines. Little to no support is provided from references and/or scholarly references are not cited properly and/or there are many errors in in-text citations and/or reference list. Word count is below 400 words. Makes several errors grammar, spelling, and punctuation errors. Errors distract reader and/or cloud meaning of the message. Some "text" or "chat" language is used. Instructor Comments: Total Points: