Providing Health Care Services

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HSMG 701 Fall 2014


Session 4: Providing Health Care Services – Physicians


Chapter 6, pp. 143-144: problems 7 and 11

Chapter 7, pp. 166-169: problems 2 and 17

Chapter 6:

7. How are the values determined in setting up a relative value scale?

The federal government established a standardized physician payment schedule based on a resource-based relative value scale (RBRVS). In the RBRVS system, payments for services are determined by the resource costs needed to provide them. The cost of providing each service is divided into three components: physician work, practice expense and professional liability insurance. Payments are calculated by multiplying the combined costs of a service by a conversion factor (a monetary amount that is determined by the Centers for Medicare and Medicaid Services). Payments are also adjusted for geographical differences in resource costs. In simple terms a physician is given a point scale and a fee percentage attached to that point on the scale and a code so when he or she sees a patient than that physician uses that code so they can charged that patient for those services."American Medical Association." American Medical Association. N.p., 16 July 2013. Web. 27 Sept. 2014.

11. Does licensure raise the quality of medical care, or does it raise the profitability of medical practice?

Licensure of professionals attempts to raise the quality of services consumers receive by barring those who do not meet a standard from providing those services. The process involves two distinct quality-control measures. First, a governing body establishes the basic qualifications the professional must meet to obtain a license to practice. Those qualifications often include educational and training requirements and demonstration of competence by passing one or more examinations. In some instances professionals must periodically renew their licenses to prove that they have maintained their skills. Second, the governing body...