Payments for Health Services Providers (125 points)
Insurance is based on pooling of losses, payment for random losses, risk transfer, and indemnification. As a result, insurers use several different approaches to mitigate their risk and set premium rates, including:
- the fee-for-service method
- the cost-plus approach
- population health – capitation
For your assignment, evaluate two global payment systems within healthcare and address each of the following items:
- Define the structure of the payment systems.
- Identify risk to loss of revenue in each system.
- Describe advantages and disadvantages of each system.
- Identify how pay for performance can be added to each payment system.
