Capitation - The Best Approach for Improving Quality of Care and Controlling Healthcare Costs |
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“Capitation” is the other approach to healthcare payments. Instead of a fee for each service performed, providers receive a fee per person, regardless of how much care that person requires. Generally, different versions of capitation are used in most other advanced nations. As an example, in Canada hospitals are given an annual budget, a set amount of money to spend, and then have to make the care provided fit within that budget. Health Maintenance Organizations often use a form of capitation, paying care providers a flat fee per patient instead of by the service performed. Integrated Care Networks such as the Mayo Clinic and Geisinger Health in Pennsylvania are examples of capitation here in the United States. Coverage for All does not force healthcare in any direction, however the change in dynamics and increased market will likely lead to the growth of Integrated Care Networks.
Integrated Care Networks
In many ways, “staff model” capitation, integrated care networks (ICNs) are the simplest, least bureaucratic approach to providing healthcare. The ICN receives a flat monthly or quarterly fee per person. Doctors and care providers, on staff, are under no pressure to increase billings, and have to do far less paperwork. ICNs allow for a more traditional relationship between doctor and patient and a more wholistic approach to coordinating treatment and keeping people healthy.
ICNs and Cost Control
ICNs also have a built-in advantages on rationing and cost controls. ICN care providers have no financial incentive to provide additional care or order additional tests and are more cautious about ordering unnecessary care which would inefficiently use limited resources. ICNs are also protected against the extreme cost of new technologies; they are only obligated to provide the care already in the network, or what they’ve contracted for with third party care providers. This model helps protects ICNs against the extreme cost of cutting edge technologies, allowing them to better keep costs down. In addition to this structural protection Coverage for All would also give ICN’s the ability to offer coverage with limitations on liability, with participants agreeing on alternative adjudication of negligence and malpractice claims.
Integrated Care Networks
In many ways, “staff model” capitation, integrated care networks (ICNs) are the simplest, least bureaucratic approach to providing healthcare. The ICN receives a flat monthly or quarterly fee per person. Doctors and care providers, on staff, are under no pressure to increase billings, and have to do far less paperwork. ICNs allow for a more traditional relationship between doctor and patient and a more wholistic approach to coordinating treatment and keeping people healthy.
ICNs and Cost Control
ICNs also have a built-in advantages on rationing and cost controls. ICN care providers have no financial incentive to provide additional care or order additional tests and are more cautious about ordering unnecessary care which would inefficiently use limited resources. ICNs are also protected against the extreme cost of new technologies; they are only obligated to provide the care already in the network, or what they’ve contracted for with third party care providers. This model helps protects ICNs against the extreme cost of cutting edge technologies, allowing them to better keep costs down. In addition to this structural protection Coverage for All would also give ICN’s the ability to offer coverage with limitations on liability, with participants agreeing on alternative adjudication of negligence and malpractice claims.