Question

The administrator of a small acute care hospital is faced with a first Managed Care contract he meets with the representative from the Prepaid Plan to discuss the amount to be paid to the hospital the administrators. Is concerned because the Managed Care business does not look profitable the hospital will be reimbursed below it's current reimbursement level. in what way might the administrator evaluate the new management care business in terms of economic value to hid tohid his the industry?

Answer 1

Solution:

The administrator might evaluate the new management care business in terms of economic value to hid his industry by the following techniques:

1.By Capitation:

It is a method of payment in which health care providers receive a fixed amount of payment per member monthly or annually, regardless of how many services that the patient used.

2.By Coinsurance:

It explains the insurance policy provision by which both the insured person and the insurer can share the covering charges in a specified ratio.

3.By the Co-payment method:

In this the cost is shared in which the managed care enrolee pays certain specified amount for a particular service. This does not vary with the cost of the service but based on the percentage charged.

4.By Deductibles:

Amount to be paid by the insured under the health insurance contract before the benefits become payable.

5.By Discounted fee for service:

Upon accepting the rate of service between the provider and the payer that is usually less than the providers full fee.

6.By Fee for service Reimbursement:

Payment in specific amounts for the specific services are rendered. It can be made by a patient, an insurance company or by the government.

7.Out of Pocket expense:

This amount is not reimbursed by the insurance coverage but paid by the patient such as co-payments, etc.

8.By Premium:

This explains about the amount paid to the insurer for providing coverage on quarterly basis.

9.Prevailing Charge:

The customary charge for medical insurance coverage.

10.Reasonable charge:

Describes the reimbursement for the services not covered under any fee schedule.

11.By Reasonable cost:

Describes the reimbursement for the services that accounts both direct and indirect costs of providers such as hospitals, etc.

12.By Reimbursement:

The actual payment received by the patients for benefits that are covered under an insurance coverage.