Cost and benefit

Revenue and Reimbursement

Miatta Teasley

Capella University

MHA-FPX5006

Health Care Finance and Reimbursement

Professor Tom Clobes

April 3,2023

A medical clinic billing policy change proposal; benefits to patients, doctors, and the clinic

Physicians owe it to their patients to cut out-of-pocket costs and make their appointments more efficient and straightforward. The clinic's most successful strategy for achieving this objective is the "bill-per-visit" billing approach (Post et al., 2021). Despite suffering a loss in billing payments, the clinic will be able to lower its overhead costs and offer patients a higher level of care. Throughout the implementation phase, it is still crucial to thoroughly explain how the new policy will benefit patients.

Billing and insurance rules are often confusing. Patients must understand practice policies and procedures before seeing a doctor. Billing changes will benefit patients, doctors, and the clinic (Post et al., 2021). Patients can expect more accurate cost projections and fewer unpleasant financial surprises. Medical professionals expect more patients to pay their bills on time without penalties. More financially stable, content and satisfied patients will also benefit the clinic.

A systematic approach that considers the entire revenue cycle

Organizations generate revenue through the revenue cycle. It covers accurate billing and payment for delivered goods and services. New technologies have driven revenue cycle management software growth over the past decade (RCM) (Post et al., 2021). Leading RCM software companies help healthcare providers optimize cash flow, collections, and reimbursement by streamlining revenue processes. Reputable companies offer these solutions.

The revenue cycle is the process of recovering unpaid medical bills. Except for direct patient care, it covers insurance claims and other payment methods for insured patients' services (Post et al., 2021). The revenue cycle is also called claim management or customer billing. Up to 10 parties—patient, doctor, healthcare provider, and payer—are involved in this process.

The formula for creating a pricing system's foundation

To make it more likely that the business will succeed, it is important to think about all the things that affect pricing when making a pricing structure. The amount of money that a company charges customers in exchange for the provision of a good or service is known as a price. One of the most critical factors that must be taken into account when creating a pricing structure is the price of the good or service that is being advertised. The cost of production, the cost of distribution, the makeup of the market, and the degree of competition are just a few of the factors that affect the price. Other factors include the need to make a certain amount of money, how competitive the market is, and how much the good or service is wanted.

Factors that are taken into account when choosing a pricing strategy

Demand is the most crucial factor in determining insurance price if the market decides what that price should be. What is referred to as the price of a product is the sum of all costs incurred to bring it to market. The cost of production, delivery, marketing, and distribution will be the basis for the price; on the other hand, demand will determine the quantity. By examining how much a consumer has already spent on a product, we can determine how much more they are willing to spend on it.

Factors to take into account when negotiating insurance contracts

The most crucial factors to consider are price, coverage, and terms. A person may use these factors to their advantage in negotiating the best terms for the contracts they are interested in (Cooper et al., 2020). For instance, a person might try raising their deductible or negotiating a more advantageous coverage plan to reduce their monthly premium. In exchange for a certain level of protection, businesses usually pay an insurance provider a premium in the form of an insurance premium (Cooper et al., 2020). But because the insurance cost is so high, the company often doesn't have enough money to run its business, threatening its ability to stay in business. Therefore, it is imperative to negotiate the best insurance policy possible. This entails figuring out the level of protection needed, accounting for the costs of the various insurance policies, and figuring out how much risk the company is willing to take on in exchange for increased profits.

When negotiating insurance contracts, there are a few other things that must be taken into account.

How much damage could potentially be done?

The likelihood that this loss will occur and

the cost associated with purchasing insurance to protect oneself from such a loss.

Valuable contributions

Before strategically negotiating insurance contracts, determine which payer groups are most important to the practice (Cooper et al., 2020). The various payer types can be divided into one of three tiers:

Big Payers: Local or national companies often offer PPO coverage to their patient bases. Major payers refer to a term used to describe them.

Regional Payers: "Regional Payers" refers to organizations that work with preferred providers in certain areas.

Local participants

How the clinic handles private and free patients

In addition to working with commercial insurance companies, the clinic plans to work with charitable organizations (Cooper et al., 2020). Most patients will be responsible for covering their costs. To ensure that those who cannot afford the care they need can still receive it, the clinic will also have a strong charity care program. Background information: Charity care is free medical attention a hospital or doctor gives to patients who cannot pay for medical services (Cooper et al., 2020). Patients who cannot pay their bills are provided with this type of treatment because they cannot afford the care they need, and the clinic will offer free medical services when necessary.

References

Cooper, Z., Nguyen, H., Shekita, N., & Morton, F. S. (2020). Out-of-Network billing and negotiated payments for hospital-based physicians.  Health Affairs,  39(1), 24-32. https://doi.org/10.1377/hlthaff.2019.00507

Post, B., Norton, E. C., Hollenbeck, B., Buchmueller, T., & Ryan, A. M. (2021). Hospital‐physician integration and Medicare's site‐based outpatient payments.  Health Services Research,  56(1), 7-15. https://doi.org/10.1111/1475-6773.13613