Health options are provided to organizations in order to implement new rules and changes in regards to the budget that will benefit those organizations and the patients related to them. The federal government provides hospitals with budgets that are to be used to take care of larger scale operations. A scenario in which the hospital is harmed in is when it collects bad debt. Bad debt for hospital is known as the Medicare or Medicaid bills that are not paid. This is partially paid by Medicare but even Medicare has a spending budget on bad debt that is about $3.3 billion. Option 10 from the article, “Options for Reducing the Deficit: 2017-2026” states “This option would reduce federal spending on Medicare by decreasing the share of allowable bad debt that the program reimburses to eligible facilities. The reductions would start to take effect in fiscal year 2018, and they would be phased in evenly over the course of three years.” This option makes for two different scenarios to be possible. The first is that the allowance for bad debt for Medicare from 65% to 45% which would end up saving $15 billion between the years 2018 to 2026. The second scenario would be decreasing the percentage of allowance from 65% to 25% and end up saving $31 billion. This option has the capability to lower Medicare spending because “Mandatory spending on Medicare, in particular, has been projected to increase by about 79% between 2010 and 2020, from $518.5 billion to $929.1 billion” (Stone, J. 2016) I think that if this option were to be implemented by the hospital, the lowering of Medicare allowance for bad debt would increase the hospitals incentive to actually collect the payments from Medicare patients. This would result in encouraging the hospital to go over accurate costs for treatments beforehand, so that the patient is actually willing to pay at the end. This would yield in proper payment plans to be set into place, which would make it so that the hospital does not lose any money. The hospital must take initiatives to save money if we want to continue to serve our patients, and this option provides a means of doing so.
Reference
Garber, S., Gates, S. M., Keeler, E. B., Vaiana, M. E., Mulcahy, A. W., Lau, C., & Kellermann, A. L. (2014). Redirecting innovation in US health care: options to decrease spending and increase value. Rand health quarterly, 4(1).
“Options for Reducing the Deficit: 2017-2026.” CBO.gov, 2017, www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/52142-budgetoptions2.pdf.
Stone, J. L., & Hoffman, G. (2010). Medicare hospital readmissions: Issues, policy options and PPACA (pp. 1-37). Washington, DC: Congressional Research Service.
Reference
Garber, S., Gates, S. M., Keeler, E. B., Vaiana, M. E., Mulcahy, A. W., Lau, C., & Kellermann, A. L. (2014). Redirecting innovation in US health care: options to decrease spending and increase value. Rand health quarterly, 4(1).
“Options for Reducing the Deficit: 2017-2026.” CBO.gov, 2017, www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/52142-budgetoptions2.pdf.
Stone, J. L., & Hoffman, G. (2010). Medicare hospital readmissions: Issues, policy options and PPACA (pp. 1-37). Washington, DC: Congressional Research Service.