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Pay for performance systems link compensation to measures of work quality or goals. Current methods of healthcare payment may actually reward less-safe care, since some insurance companies will not pay for new practices to reduce errors, while physicians and hospitals can bill for additional services that are needed when patients are injured by mistakes. [1]
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The McKinsey report also noted that healthcare supply input costs, which spiked in late 2020 and 2021, continue to be above the norm and that growth in labor costs are staying high.
Managed care plans are widely credited with subduing medical cost inflation in the late 1980s by reducing unnecessary hospitalizations, forcing providers to discount their rates, and causing the health care industry to become more efficient and competitive.
This cost-spreading mechanism often picks up much of the cost of health care, but individuals must often pay up-front a minimum part of the total cost (a deductible), or a small part of the cost of every procedure (a copayment). Private insurance accounts for 35% of total health spending in the United States, by far the largest share among OECD ...
It's no secret that healthcare costs in the U.S. are very high, and many experts predict these costs will continue to increase. As Reuters reported, U.S. employers are bracing for the largest ...