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Mechanisms of Paying for Health Care

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Geriatric Medicine

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Abstract

Albert Einstein is quoted to have said: “The definition of genius is taking the complex and making it simple.” The goal of this chapter is to make one a bit of a genius when it comes to understanding the complex mechanism for paying for health care. The journey begins with an examination of the foundation of coverage and benefits. Coverage: through eligibility of Medicare for those >65 years of age, disabled, as well as those with end-stage renal disease and amyotropic lateral sclerosis. Benefits: Medicare alphabet soup provides Parts A–D where A includes hospital, skilled nursing facilities short term, and hospice; B includes provider services; C are the benefits of A + B provided through a managed care organization under Medicare Advantage (MA); and D provides prescription drugs. Whereas Medicaid covers skilled nursing facilities long term as well as the out-of-pocket (OOP) expenses of Medicare. These OOPs can also be covered through Medigap coverage.

Care delivery is especially confusing given the changes occurring in shifting from volume to value-based payment models as well as the expansion of Medicaid under the Affordable Care Act. Of the three factors – coverage, benefits, and delivery – coverage eligible is the most stable element, while benefits are adjusted annually and delivery is rapidly undergoing change currently. Delivery: while primarily through fee-for-service (FFS) providers, it is shifting to value-based care through growth of MA enrollment but especially with managed care principles being applied within the FFS by at-risk groups such as Accountable Care Organizations and similar delivery models.

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Authors and Affiliations

  1. Jefferson College of Population Health, Thomas Jefferson University, Philadelphia, PA, USA

    Richard G. Stefanacci

Authors
  1. Richard G. Stefanacci
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Correspondence to Richard G. Stefanacci .

Editor information

Editors and Affiliations

  1. California Association of Long Term Care Medicine, Newbury Park, CA, USA

    Michael R. Wasserman

  2. Betty Irene Moore School of Nursing, University of California, Davis, Sacramento, CA, USA

    Debra Bakerjian

  3. Department of Clinical Pharmacy, University of Colorado Skaggs School of Pharmacy and Pharmaceutical Sciences, Aurora, CO, USA

    Sunny Linnebur

  4. Division of Geriatrics, SUNY Upstate Medical University, Syracuse, NY, USA

    Sharon Brangman

  5. Department of Clinical Sciences and Community Health, University of Milan, Milan, Italy

    Matteo Cesari

  6. Section of Geriatric Medicine, Division of Internal Medicine, Department of Medicine, Cedars-Sinai, Beverly Hills, CA, USA

    Sonja Rosen

Section Editor information

  1. Betty Irene Moore School of Nursing, University of California, Davis, Sacramento, California, USA

    Debra Bakerjian PhD, APRN, FAAN, FAANP

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Stefanacci, R.G. (2024). Mechanisms of Paying for Health Care. In: Wasserman, M.R., Bakerjian, D., Linnebur, S., Brangman, S., Cesari, M., Rosen, S. (eds) Geriatric Medicine. Springer, Cham. https://doi.org/10.1007/978-3-030-74720-6_98

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  • DOI: https://doi.org/10.1007/978-3-030-74720-6_98

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  • Publisher Name: Springer, Cham

  • Print ISBN: 978-3-030-74719-0

  • Online ISBN: 978-3-030-74720-6

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