The EXIT of Fee-For Service Medicine

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By staff reporters


[Some Pundits say … Bye-Bye]

Continuing the health insurance industry’s march further away from fee-for-service medicine, UnitedHealth Group UNH +0.81% (UNH) will increase value-based payments to doctors and hospitals by 20 percent in 2015 to “north of $43 billion.”

UnitedHealth, considered a barometer for the health insurance industry given its size, is rapidly departing from the traditional fee-for-service approach that can lead to overtreatment and unnecessary medical tests and procedures.


Value-based pay is tied to health outcomes, performance and quality of care provided. UnitedHealth’s pronouncements are in keeping with its previously stated commitment to increase payments that are tied to value-based arrangements to $65 billion by the end of 2018. Value-based payments come in a variety of forms.




They include: pay-for-performance programs, patient-centered medical homes and accountable care organizations [ACOs], a rapidly emerging care delivery system that rewards doctors and hospitals for working together to improve quality and rein in costs.

Source: Bruce Japsen, Forbes


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2 Responses

  1. Understanding the True Costs of ACOs and Medical Homes

    One of the privileges of being a managed care advocate is that you never have to discuss the unpleasant question of how much your proposed intervention will cost. Whether your proposed intervention is HMOs, report cards, pay-for-performance, ACOs, “medical homes,” or electronic medical records, you never have to estimate what your bright idea will cost. With this privilege comes another: You are free to criticize doctors and hospitals for being “cost unconscious.”

    Over the last decade, CMS has become a proponent of this double standard – cost consciousness for doctors and hospitals and cost unconsciousness for the health policy illuminati.



  2. 73% Don’t Think Their Insurance Plan Understands Their Health

    HealthMine recently released results from their 2017 Health Intelligence Report on communication and digital healthcare. Here are some key findings from the report:

    • 73% don’t think their insurance plan understands their health very well.
    • 3 in 5 want more communication from health plan sponsors not about bills.
    • 39% of consumers say health plan does not offer price transparency tool.
    • 63% of health plan members are disconnected from their plan on social media.
    • 3 in 10 say their plan’s member portal helps them answer healthcare questions.
    • 83% of consumers say they use digital health tools.

    Source: HealthMine, May 14, 2017


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