James
These four components deal with the method providers are compensated as well as the amount. DRG (Diagnostic Related Groups) comprise of codes that represent different services with a respective price and play a crucial role in properly identifying the correct amount of reimbursement. RVUs (Relative Value Unit) calculate reimbursement amounts based on the CPT (Current Procedural Terminology) code.
Bundled payments reimburse providers with a predefined amount based on the service. For example, if a kidney transplant costs $20,000, then every time a provider performs one, they’ll receive $20,000. This would account for everything involved in the process of the transplant.
This method of payment is very straight forward but could potentially cost the patient way more than necessary. Not every procedure is the same/ requires the same things. Patients that use a couple of the services in the bundle will pay the same amount as a patient that uses all of them. On top of this, providers can be underpaid in some situations, which could tempt them to disregard services within the bundle that the patient might actually need.
Angela
DRGs are important by processing payments and organizing data while RVUs is a unit that assigns the cost and difficulty of procedures. Capitation is when that the provider gets a set pay per customer/patient each month, no matter how much the patient spends. The downfall of this is that providers who treat very ill people are being paid the same as people who treat healthier people. Technically people who works more or harder will have the same pay as people who don’t do as much, so the provider will want more healthier people to treat. A pro is that the payment system is very simple than compared to the complicated billing and coding.
