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Health Qs
Massachusetts Cost Limiting Proposal
One of the major problems of the current healthcare system implemented by the State of Massachusetts is the cost of maintaining the program and providing the necessary healthcare to Massachusetts' citizens dependent on the state insurance program. Ideally, of course, the program would be paid for via the revenues generated form business contributions, premium payments into the state system, and general tax funding. Revenue can only make up half of the solution for paying for the system, however; costs must also be effectively managed and strictly limited if the program is to be successful in the long-term. One proposal for limiting these costs is switching from a reimbursement-for-services model of physician payment to the creation of performance-based salaries or regular payments.
There are several features of moving to a pay-for-performance rather than a pay-for-service model that have the potential to yield significant savings. As the state would not want to become directly involved (at this point, at any rate) in the hiring of physicians, maintenance of facilities throughout the state, etc., the salary payments would be based on the number of state-plan patients treated each period, or averaged out over a year, rather than on the services each physician provides. Paying per service...
Physicians would also be incentivized to treat patients on state plans to boost their salaries.
When improved health outcomes and number of state plan patients cared for rather than the number of services provided become the targets of increased salaries, cost controls will become self-perpetuating. Up-front and even pre-service payments to physicians will lower their operating costs, reduce their billing expenditures, and increase available capital and the speed of payment. This will make state-plan patients more efficient and cost-effective than other patients. Physicians will be incentivized to enroll patients and to keep them healthy, not to avoid government patients or to order unnecessary tests and procedures as a means of achieving higher pay from the government. There are certainly major complications to this proposal, most notably the need to track physician patient enrollment and the health outcomes of patients in order to determine pay scales. Once a proper system is put in place, however, it could be kept up with minimal human resources and technology.
Reconciling Efficiency and Market…
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