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Medicare Payments Will Depend On Quality And Not The Volume Of Care Given

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Health Of Patients Will Be Monitored

On Monday, the Obama administration announced a new payment plan for Medicare by which the payment of doctors and hospitals will be tied more closely to the quality of care and not the quantity. Rather than getting paid for any and every procedure done by them, the government will evaluate whether patients are healthier. Half of all Medicare payments will be handled this way by 2018. Till date this is the biggest effort to shape how doctors are compensated across the health care system. Medicare being the largest payer of health care services, influences medical care.

Government Wanting To Stop Wasteful Expenditure

The biggest aim of the government is to cut down on the wasteful expenditure and Medicare’s payment system leads to taxpayers shelling out $362 billion. Critics have said that the traditional methods of payment has not discouraged overuse of health care services, without holding providers accountable for whether patients get healthier. Till now, there have been other forms of payment like Affordable Care Act of 2010 and Accountable Care Organizations (ACOs). The government wants 85% of these payments tied to programs which penalize hospitals for excessive readmissions or reward them for hitting quality metrics by 2016. However, as Health and Human Services Secretary Sylvia Mathews Burwell said, not everyone could implement the system so fast.

Private Sector Have Shifted To Value-Based Payments

Health and Human Services also said that at present 20% Medicare payments follow alternative payment structure and by 2016 it has to rise to 30%. Debra Ness, President of the National Partnership for Women & Families said, “We’re not just talking about payment that lowers costs,” “The payment changes are designed to change the way that we deliver care in ways that will make that care work better for patients and families.” While Medicare is contemplating the move now, private sectors have been making a steady move towards it even before the Affordable Care Act.