Massachusetts will have another reason to be closely watched by healthcare policy wonks and the Obama administration alike: a change in reimbursement schemes to that state’s physicians is in the proposal stage. Prior to the economic collapse of 2007 and the recession that followed, the average person had no idea to manage a budget, let alone acknowledge that there was a reason to do so.  Today, with many states flirting with 10% unemployment and stalled economies, following strict budgets is the financial plan du jour — something everyone from policymakers in state legislatures on down to the elderly widowed female living on a fixed income from Social Security payments in subsidized housing is actively undertaking.

An independent state commission (made up of some members of Massachusetts’ current gubernatorial administration) is endorsing a “global payment scheme” which aims to replace traditional fee-for-service (negotiated) reimbursement schedules for care by third parties per patient by establishing a current and future budget designed to cover that patient’s care for an arbitrarily subsequent length of time. Essentially, the provider would be given a budget that would force him or her to keep healthcare expenses within the particular patient’s care trajectory.

In any other fiscal scenario, a budget would make sense. But when it comes to healthcare, all bets are off. While it may be tempting to think that healthcare costs due to, for example,  unnecessary testing, branded prescription medication writing, and avoidable hospitalizations would be reined in by such a plan on a per patient basis, one has to remember that such a scheme does nothing to decrease care costs — if anything, it may delay or defer them. Preventive medical practice, while encouraged and enhanced by this move, would probably not decrease the potential costs associated with that patient’s chronic disease. That’s because direct costs are not the only ones providers have to worry about.

The indirect costs — the unforeseen liabilities which are as individual as the patient in which they accrue — can continue to mount. Misplaced and restrictive caps on per-patient care would not be able to suppress the patient’s burgeoning healthcare needs. Besides, who sets the yearly capitated fees per patient, and how will they be adjusted? This, of course, is all dependent on a rather static healthcare economy and a similarly static patient healthcare profile — issues that have about as much chance as remaining in their existing forms as does the current healthcare reform bill before congressional debate ensues. | LINK

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