There are several types of fee-for-services such as per diem, Cost-based reimbursements, and charge-based reimbursements etc

Part 1

There are several types of fee-for-services such as per diem, Cost-based reimbursements, and charge-based reimbursements etc. 

Fee-for-service is the most common methodology used by private insurance. In a fee-for-service system, a provider bills the insurance 

company for all services rendered based upon a published fee schedule. Here, items are unbundled and pay for separately.  In a fee-for-

service system, the incentive for providers is to bill for as many services as possible, since the providers income increases as the volume of 

services rendered increases.

However, there are two major types of reimbursement (Fee-for-Service) and Capitation. In some case, others add a third method known as

Valued-Based Purchasing (VBP).  The Value-Based Purchasing (VBP) Program is a Centers for Medicare & Medicaid Services (CMS) initiative that rewards acute-care hospitals with incentive payments for the quality care provided to Medicare beneficiaries. Under this method, hospitals are no longer paid solely on the quantity of services provided but the quality is factored in as well.

1. Explain the impact of healthcare reform on insurance and reimbursement methodologies.

Part 2

Health insurance premiums increased each year between 1999 and 2007 and it’s projected to continue increasing (Barton, 2010). Other 

indicators, including the aging of the baby boomers, also suggest a continued increase in annual health expenditures and uninsured. 

1. Discuss how reimbursement methodologies impact the operations of healthcare organizations, particularly around the dimensions of access, cost, and quality.