Explain why the U.S. healthcare system has transitioned from a fee for service to a managed...

Explain why the U.S. healthcare system has transitioned from a fee for service to a managed care system and now to one who’s reimbursement system rewards quality outcomes

Expert Solution

Earlier the U.S healthcare system was based on ‘fee for service’ where the healthcare providers were paid for the quantity of services provided rather than quality services or valuable outcomes. As a result, regardless of excessive expenditures on healthcare maintenance the U.S healthcare performance index remained the lowest among the other countries.

Some specific factors which lead to the need of a transformed and improved healthcare system were:

Irrelevant payment system and high cost of service.
Improper Healthcare Management by the providers.
Medicaid Access issues.
Declining quality of Healthcare services

Thereafter, the Affordable Care Act initiated several healthcare programs to curb these problems and change the ‘fee based healthcare’ system to a ‘value based reimbursement’ system. One of such programs is the ‘Value Based Purchasing’ program where payment is made not just for providing service but for performance by delivering quality services to the patients.

Thus it can be said that a transformed healthcare system will not only aid in improving the healthcare system in U.S but will also save a lot of funds which can be utilized for other economical and social development of the country.

keosha answered 8 months ago

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