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The Future of Healthcare Reform In the United States$
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Anup Malani and Michael H. Schill

Print publication date: 2015

Print ISBN-13: 9780226254951

Published to Chicago Scholarship Online: May 2016

DOI: 10.7208/chicago/9780226255002.001.0001

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Can Federal Provider Payment Reform Produce Better, More Affordable Healthcare?

Can Federal Provider Payment Reform Produce Better, More Affordable Healthcare?

(p.221) Chapter Nine Can Federal Provider Payment Reform Produce Better, More Affordable Healthcare?
The Future of Healthcare Reform In the United States

Meredith B. Rosenthal

University of Chicago Press

This chapter discusses whether and how payment policy can be an effective tool for improving health care delivery and whether past and present payment reforms will lead to better and more affordable health care. Focusing on Medicare, the chapter sketches out the theoretical framework that health economists use to examine provider payment and summarizes the empirical tests of this theory. It then summarizes the evolution of Medicare from cost-based to prospective reimbursement and its entry into value-based purchasing and assesses whether payment policy is making progress. The chapter concludes that on the whole, efforts to transform health care by mobilizing or redirecting competition through consumers are problematic owing to the limits of patient expertise and hidden information and actions by providers. Finally, addressing the question of whether it is possible to get payment “right,” the chapter concludes that as long as payment for physician services is based on a fee schedule and each provider is in its own silo, cost control will remain extremely difficult.

Keywords:   Medicare, health care reform, payment reform, Affordable Care Act, ACA, insurance, health care

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