Career and Life Planning Guidebook for Medical Residents

Understanding The Other Side of Medicine Many healthcare policy experts believe that fee- for-service payment models are inefficient because they provide a financial incentive for physicians to provide more services. An extra procedure or test can generate additional revenue for a physician, regardless of whether it is clinically necessary. Much of the reform in the healthcare system is targeted at creating compensation systems that reward physicians for providing the optimal level of services, rather than providing more money for more care. The Medicare Access and Chip Reauthorization Act of 2015 changed the Medicare reimbursement model to include bonuses and/or penalties based on measures of outcome quality. These combined quantity/quality reimbursement methods will continue to grow over time. In addition to fee-for-service payments, physicians maygenerate revenue inotherways. Somephysician- ownedpractices own ancillaryservices such asX-Ray and other diagnostic tools, lab services, or other services. These services are often billed separately but can enhance the revenue of a practice. In contrast to fee-for-service models, some payers use capitation models to reimburse healthcare providers. Capitation is a model with a fixed amount per member per month to cover the costs of the delivery of healthcare. If patients have few clinical needs, then the physician group does well by being paid the same amount for providing fewer services. On the other hand, if patients have high clinical needs, the physicians provide more work for the same level of pay. This gives physicians an incentive to keep their patients healthy and keep the cost of care low. However, it also means that physicians bear financial risk, a role typically better suited for insurance companies. It is likely that several new payment methodologies will continue to appear in the coming years. The goal of any healthcare payment system should be to reward providers for providing the clinically appropriate level of care, and doing so in a way that drives the best clinical outcomes, patient satisfaction, and reduces unnecessary cost. Medical Documentation and Coding An important skill for physicians is to accurately document and code their clinical services. Proper documentation enhances quality medical care by communicating the diagnosis, history and treatment with other medical professionals, and reduces risk of malpractice claims and liability. It also enhances business outcomes by documenting quality measures and ensuring appropriate reimbursement. A billing claim contains four elements: the patient information, insurance information, diagnosis codes, and a procedure code. Procedures are documented using the Current Procedural Terminology (CPT) code. The proper CPT code will ensure accurate reimbursement. However, it is important to ensure that the billed CPT matches the documentation of the treatment. Since reimbursement is linked to the 123 WWW.PHYSICIANCAREERPLANNING.COM