Student Paper on Medicine





Categories RVU Geographic Cost Index Product
Work 27.45 1.092 29.98
Practice Expense 43.05 1.743 75.04
Malpractice 10.32 0.543 5.60
Conversion Factor: 64.43


Using the above figures, the payment rate would be equal to the sum of all the products multiplied by the conversion factor.

= 29.98 + 75.04 + 5.60 = 110.62*64.43

= 7127.2466 (Medicare Approved Rate)

  1. How much will Medicare pay Dr. Robinson if Dr. Robinson is a Medicare participating physician? How much out-of-pocket payment will Mr. Roberts be responsible for?

The Medicare will pay 100%. Thus it will sum to $7127.2466.

Out of this, Mr. Robert will be responsible for 20% of the approved fee. Thus he will pay 0.2*7127.2466 = $1425.4493.



  1. How much will Medicare pay Dr. Robinson if Dr. Robinson is a Medicare non-participating physician who elects assignment? How much out-of-pocket payment will Mr. Roberts be responsible for?

The Medicare will pay 95% of the Medicare-approved fee. Thus, it will be 0.95*7127.2466 = $6770.8842.

Out of this, Mr. Robert will pay 20% of the approved fee. Thus he will pay 0.2*7127.2466 = $1425.4493.

  1. How much will Medicare pay Dr. Robinson if Dr. Robinson is a Medicare non-participating physician who does not elect assignment? How much out-of-pocket payment will Mr. Roberts be responsible for?

Dr. Robertson will get 115% of the approved fee. Thus it will be 1.15*7127.2466 = $8186.3335. Robert will pay the entire amount but the Medicare will reimburse 80% of the approved amount to Robert.



Medicare is the insurance program of the nation for the disabled and the aged. Outpatient services are the medical tests or procedures that can be done in a medical center without the patient staying overnight. The services include wellness and prevention, diagnosis, treatment, and rehabilitation. The services are cheaper due to the absence of the overnight stay, and the care needed is provided in one place (Outpatient Services, 2013). The Outpatient and physician services are under the complementary medical attention. There are specific payment rules for covered benefits for all these services. Outpatient services fees have been a combination of cost reimbursement and fee schedules by reimbursing a hospital for its reasonable care costs. That encompasses Medicare costs for labs and historical charges. On the other hand, physician services are based on the physician fee schedules for imaging and therapies. That is called fee for service. There is also capacitation which increases prescriptions and referrals, imposing costs on other expenditure budgets on health care. The other method is through remuneration of salaries, although it has less impact than the patient’s health characteristics (Grignon et al. 2002).


There are two types of payments namely, global payments and bundled payments. They encourage providers, payers, and other stakeholders to work together on the strategies of innovation to improve the quality of care, reduce system inefficiencies, share savings and work towards coordination of the full system care. There are two types of payments.

Bundled payment is also called episode-based payment. It is a system under which the reimbursement for several providers is bundled into a single and comprehensive payment. It is a one-time payment to a provider or a group of providers for health care services that are associated with a defined care episode. This comprehensive fee covers all the services that are involved in the care of the patient. They aim to integrate the care delivery services, control the cost and restructure the delivery of primary care. That is in line with the objectives of the Institute for Healthcare Improvement, to improve population health, reduce cost and boost the patient care experience. It is a viable option that meets the goals of payers and providers, since it presents potential improvements over the Medicare system of fee-for-service of reimbursement alongside the capitation payment model (American Hospital Association, 2010).

On the other hand, a global payment is a fixed prepayment that is made to a health care system or a group of providers, unlike the health care plan. It covers most of the care of the patient during a specified period under the contract. The global payments are paid every month for each patient over a year. That is contrary to the fee-for-service system for the bundled payments. They are adjusted to reflect the health status group of people, who on their behalf the payments are made. They are also adjusted for severity of the illness (American Hospital Association, 2010).

Therefore, the significant difference between these two types of payments is that bundles payments usually cover the episodes of care for the patients with particular conditions. On the contrary, global payments include total care regardless of the number of services provided to the patients (Bundled and Global Payments, n.d.).


MODULE 5 – Threaded Discussion



There are the current payment reform initiatives with a common attempt to change the manner in which health care is delivered. That is by the change in the way providers are paid. There are three payment reform initiatives as explained below. Firstly, there are bonus payments to meet specific targets, also termed as pay for performance. This mechanism offers bonuses to providers who make significant progress towards quality targets. It builds incentives for quality improvement into the fee-for-service payment system which is volume-based. Secondly, there are payments for care coordination. This mechanism encourages events that are discretely billable like diagnostic tests and office visits. It does not reward providers who do well for managing the chronic health conditions of their patients. It has thus gained much support from both private and public payers. Finally, there is the replacement of the volume-based payment system with one that encourages innovation and efficiency such as bundled payments. The bundled payments reward the services that are needed to treat a particular condition or an episode of care, instead of penalizing providers who are efficient in preventing costly complications (Sonier & Blewett, 2011).



The inadequacy of universal health care is a fundamental moral issue in the United States. It is the only industrialized country that lacks some form of health care to all – basic universal health care to all the citizens. The United States treats the health care of its citizens as a privilege, and only avails it to those who are able and can afford it, making health care be perceived as an economic asset and not as a public or social good. This sense makes over 45 million citizens to be victims due to lack of health care insurance. Over 80 percent of the uninsured citizens are those who are hardworking and most of them employed or come from working families (Chua, 2006). The lack of insurance brings emotional suffering for the citizens, leading to anxiety, depression, familial stress and fear. It makes them financially bankrupt, and the families strain a lot financially. Additionally, more and more insured citizens are dropping their health insurance at a significant pace. That is due to the rise in the cost of health care insurance premiums reducing their wages. The cost of universal health care, from statistics, would total up to at least $34 to $69 billion (Chua, 2006). Economically, that entails an enormous outlay of money that has no economic returns, although it helps gain a longer-living and healthier workforce. In my opinion, there will never an acceptable solution for the provision of universal health care insurance to all the citizens of the United States.


The commitments to equal opportunities in the United States ring hollow when programs particular programs help the people who have good jobs and incomes to get access to certain facilities. These facilities include the health insurance, parental leave, and housing retirement pensions. These commitments, however, offer very insignificant help to the poor and those nearing poverty. The government provides tax breaks to the people, especially employers, who purchase private health insurance. That contradicts the expectations of many citizens to receive subsidies in the wages of disabled workers. That move does not help the poor, rather adds poverty to them and the poverty prevails in the whole of the nation. The Medicaid expansion plans help provide free or low-cost health coverage to people with low incomes regardless of family status, disability or financial resources. The development plans can help the have-nots get medical benefits from the haves. Therefore, if all the states took that initiative positively, the better will be the health care facilities in the United States.


Education for patients regarding the health care insurance is very necessary. The first and imperative principle in the structuring of an organization is to organize around the customers, who are patients in case. The education program for the patient should be structured and delivered as follows. It should begin with a self-pay policy that communicates the responsibility of the patients on particular payments. The portals of patients should allow them log on and see what anticipated costs of care they are to pay. The providers must also offer swift eligibility for insurance and make follow-ups of the payments on the treatment day, following the right protocol of events (The Importance of Patient Education in Medical Debt Collection, n.d.).







American Hospital Association. (2010). Committee on Research. AHA Research Synthesis Report: Bundled Payment. Chicago: American Hospital Association, 2010

Bundled and Global Payments. (n.d.). Retrieved March 19, 2015, from

Chua, K. (2006). The Case for Universal Health Care. Retrieved March 19, 2015, from

Global Payments to Health Providers. (2010, May). Retrieved March 19, 2015, from

Grignon, M., Paris, V., Polton, D., Couffinhal, A., & Pierrard, B. (2002, November). Influence of Physician Payment Methods on the Efficiency of the Health Care System. Retrieved March 19, 2015, from

Medicaid expansion & what it means for you. (n.d.) Retrieved March 19, 2015, from /

Outpatient Services. (2013, November 5). Retrieved March 19, 2015, from

Sonier, J., & Blewett, L. (2011, February). Payment Reform: The Lynchpin of Health Care Reform. Retrieved March 19, 2015, from

The Importance of Patient Education in Medical Debt Collection. (n.d.). Retrieved March 19, 2015, from

Medicare Payment Advisory Commission. (2013). Physician and Other Health Professionals Payment System. Available at

Centers for Medicare and Medicaid. (2010). Medicare Physician Fee Schedule. The Medicare Learning Network Payment Systems Fact Sheet Series. Available at (Retrieved 11/21/2012)

Guterman, S., Davis, K., Stremikis, K., & Drake, H. (2010). Innovation in Medicare and Medicaid Will Be Central to Health Reform’s Success. Health Affairs, 29 (6), 1188-93. Retrieved from ProQuest on 11/21/2012.

Lesser, C., Fineberg, H., & Cassel, C. (2010). Physician Payment Reform: Principles That Should Shape It. Health Affairs, 29 (5), 948-952. Retrieved from ProQuest on 11/21/2012.

Wilensky, G. (2009). Reforming Medicare’s Physician Payment System. New England Journal of Medicine, 360 (7), 653-655. Available at