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Fact or fiction? Fee-for-service care to be ended

<strong>The insurance overhaul may end fee-for-service care so doctors get a fixed salary from the government. fact-checks this claim — and more.</strong></p>

Claim: The insurance overhaul may end fee-for-service care so doctors get a fixed salary from the government.

A fee-for-service (FFS) system, as is commonly used in the Medicare program, pays caregivers fixed amounts for each service provided to patients. According to the Congressional Budget Office, doctors and hospitals in Medicare’s FFS program have little or no financial incentive "to deliver care in an efficient, cost-effective manner." As Urban Institute economist Stephen Zuckerman said, under FFS "the incentives to over-provide services can be very strong." So "there is definitely interest in moving away from unbridled FFS as it currently exists." Congressional Democrats are proposing ways of paying for quality — rather than quantity— of care.

Fact or fiction?
Fiction. According to a Senate Finance Committee aide, the committee’s bill moves away from fee-for-service, but not toward a salary system. Instead, the bill begins to set up a "value-based" system in which providers are paid incentives for providing higher quality service. "It is still a fee-for-service system," the aide said. "There will still be a fee for each service, it just isn’t the same fee in all cases." For instance, Medicare pays hospitals a slightly higher payment to keep track of indicators such as if a heart-attack victim receives an aspirin immediately upon admission to the hospital, a medically recommended step. A value-based program will give higher payments to hospitals that do administer the aspirin. The challenge for Congress and the secretary of Health and Human Services will be determining precise and rigorous measures of quality.

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