Pay-Per-Disease?

Some believe we should move a system where health insurers pay a fixed, up-front cost for each particular health problem—and let the hospital and caregivers use the money as they see fit.

"Why don't doctors do a better job of matching the right patients with the right procedures?" asks Darshak Sanghavi. "Observers tend to blame this mess on our 'fee-for-service' payment system. The more doctors do, the more they are paid; rather than rewarding quality, insurers pay for quantity. ... That's why many reformers believe the solution is to 'bundle' payments: Insurers would pay a fixed, up-front cost for each particular health problem—like asthma—and let the hospital and caregivers determine the best way to use the money to deliver quality care. Bundling could save money, improve care, and encourage innovation by health providers."

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