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QUESTION
Explain the flow of funds within an organization including private pay and third party reimbursement.
Assignment Description: This assignment will be at least 1000 words or more
This week you will reflect upon accountability in healthcare to answer the following questions:
How can you prevent abuses and inefficiencies in third party payments?
Briefly define the flow of funds in the Care Organization.
What challenges do consumers face who are enrolled in private insurance?
What methods can you use to empower the consumer?
Assignment Expectations: How will students be successful?
Length:
1000-1250 words (4-5 pages); answers must thoroughly address the questions in a clear, concise manner
Structure:
Include a title page and reference page in APA style
References:
Two scholarly references are required; you should include the appropriate APA style in-text citations and references for all resources utilized to answer the questions
Format:
Save your assignment as a Microsoft Word (.doc or .docx), Open Office (.odt) or rich text format (.rtf) file type
File name:
Name your saved file according to your last name, first initial and the week (for example, “jonesb.week1”)
Submission:
Submit your assignment to the Drop Box
ANSWER
Accountability in Healthcare
Accountability in Third Party Payments
Common healthcare problems experienced in third-party payments include billing for no-show appointments, billing for services not furnished, overbilling, and submitting manipulated insurance claims for services. Abuses and inefficiencies in payments generate costs that are unnecessary. In the healthcare industry, third-party payments are mostly the insurance covers that are provided by insurance companies that pay healthcare service providers for the healthcare services provided or rendered to employees and patients. These payments may be indirect or direct, where medical expenses are directly paid by the insurance company to the healthcare services provider (Enthoven, 2014). A key major issue related to payments in the healthcare sector is overbilling. This is malpractice or abuse that is orchestrated by either the third party or the healthcare provider.
Overbilling can be prevented by ensuring that healthcare providers give information that is honest and accurate. Payment inefficiency occurs as a result of the manipulation of reimbursement by healthcare providers. Manipulation of reimbursement can be prevented by ensuring that investigation is conducted to identify those involved in the malpractice so as to charge them. Through the manipulation of reimbursement and payments, a healthcare services provider uses deception to acquire unauthorized benefits, while an additional cost is imposed on the payer. Since abuse and fraud cost the healthcare industry and the nation billions of funds every year, it is important that measures are placed to minimize cases of abuse, payment inefficiencies, and fraud. Stakeholders in the healthcare industry can ensure accountability by developing billing fraud prevention and mitigation policies and programs.
For purposes of preventing overbilling and other forms of third-party payment abuses and inefficiencies, healthcare providers and other stakeholders need to understand the various healthcare fraud regulations, to develop compliance programs, and improve healthcare billing processes, including third-party payments. Healthcare providers should understand laws such as the Federal False Claims Act, the Anti-Kickback Statute, and the Physician Self-Referral Law (Krause, 2013), after which compliance policies and programs should be developed. These may include: continuous education and training of staff on the compliance with laws; development and issuance of written conduct policies and standards promoting compliance with anti-fraud laws; deployment or hiring of a compliance officer charged with monitoring compliance programs and reporting fraud; tracking adherence to policies and programs through audits and evaluations to minimize third-party payment issues; development of an effective system for fraud response and take disciplinary action against facilities and staff who do not abide by compliance policies; and maintenance of a working process to receive all healthcare fraud complaints and reports.
Healthcare providers should compare their services and products billing data against industry and competitor standards to minimize third party payment issues. Healthcare providers need to be proactive in the evaluation of billing data and its comparison with similar providers to identify any discrepancies and why they are occurring. It is also important that healthcare providers practice caution when it comes to investing in healthcare and related businesses. Healthcare providers often invest in third party ventures such as cancer centers, physical therapy clinics, and laboratories to expand access to patient care. However, referrals to such facilities could result in the provider being investigated for illegal kickback schemes or self-referrals. For purposes of avoiding such problems, healthcare providers need to ask themselves important questions such as whether the investment interest will require a huge capital contribution, whether the business will have adequate capital from various sources to finance operations, and whether they will be more inclined to refer consumers for services that are provided by the business as a result of having invested in it. This way, a provider can determine whether the investment may put them at risk and make an informed decision on whether to pursue the investment or drop it.
Flow of Funds in Healthcare
The flow of funds can be explained as the framework by which the distribution of funds from public and private health resources, through intermediaries, to healthcare providers and functions can be traced (Blackstone & Fuhr, 2004). Intermediaries include insurance providers and Medicare providers. The flow of funds in the healthcare industry may also be explained as the process by which any funds allocated by the government and insurance providers are availed to the people receiving medical care and services. Through the flow of funds, financial resources allocated to medical care providers and patients can be tracked to ensure accountability, identify misappropriation of funds, and prevent fraud.
Challenges Faced by Consumers Enrolled in Private Insurance
Private insurance healthcare consumers face a wide range of challenges. First, consumers in private insurance plans pay higher premiums since the cost of private insurance is higher than that of public health insurance. Consumers using private insurance plans also face a huge challenge since private insurance plans fail to cover all medical services, that is, private insurance plans are not comprehensive but only cover some medical services. With private insurance plans, consumers select the specific medical services that they need to be covered (Anderson et al., 2012). Some medical services are covered up to a certain extent under private insurance plans, which means that consumers have to pay for some services from the pocket. Another challenge for private insurance consumers is inequality in how they are treated. Consumers who pay higher premiums are able to get priority or preferential treatment. Also, private insurance care only applies to (or is accepted in) specific healthcare providers and organizations. This poses a huge challenge to consumers since they have to acquire medical services from specific hospitals and facilities. A consumer may have to pay for services from a health facility that is not covered by their insurance, making healthcare more costly for private insurance customers.
Empowering the Consumer
It is important to empower the consumers to ensure that they achieve better outcomes from the medical services provided. Consumer empowerment ensures that consumers are fully aware of what they should be provided with and how they can access healthcare services at an affordable cost while achieving the best possible outcomes from the services provided. There are many ways through which consumers can be empowered by healthcare providers. These include (Anshari et al., 2012): provision of healthcare services that are satisfactory at an affordable price; helping and enabling consumers to be well-informed on healthcare matters and availability of healthcare services; assisting patients to ensure adherence to the instructions provided to them; developing solutions that allow consumers to monitor their health and medication; assisting consumers to frame questions on healthcare and services; and establishing healthy relations between consumers and healthcare providers.
References
Anderson, M., Dobkin, C., & Gross, T. (2012). The effect of health insurance coverage on the use of medical services. American Economic Journal: Economic Policy, 4(1), 1-27. https://www.aeaweb.org/articles?id=10.1257/pol.4.1.1
Anshari, M., Almunawar, M. N., Low, P. K., & Wint, Z. (2012). Customer empowerment in healthcare organisations through CRM 2.0: survey results from Brunei tracking a future path in e-health research. arXiv preprint arXiv:1207.6164. https://doi.org/10.2190/iq.33.2.g
Blackstone, E. A., & Fuhr, J. P. (2004). Health economics: Fundamentals and flow of funds Thomas Getzen, 2004, pp. 464. Atlantic Economic Journal, 32(4), 346-354. https://link.springer.com/article/10.1007/bf02304239
Enthoven, A. C. (2014). Theory and practice of managed competition in health care finance. Elsevier. https://www.elsevier.com/books/theory-and-practice-of-managed-competition-in-health-care-finance/enthoven/978-0-444-70359-0
Krause, J. H. (2013). Kickbacks, self-referrals, and false claims: The hazy boundaries of health-care fraud. Chest, 144(3), 1045-1050. https://doi.org/10.1378/chest.12-2889
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