Payment Changes

A major component of health care reform will be changes to the provider reimbursement and payment system. The goals are to 1) increase the quality of health care and 2) reduce cost (Yes, the two can go together). Below are a few developments in this area. As a health care attorney, it is critical that I stay abreast of these changes which will impact my clients in Florida.


CMS To Test Bundled Payment Models

Last week, The Centers for Medicare and Medicaid Services (CMS) announced its bundled payment initiative. CMS invited providers to apply to help the federal agency test and develop different models of bundling payments for services that patients receive across a single episode of care.

The Bundled Payments for Care Improvement Initiative, is intended to encourage better coordination of care among physicians, hospitals, and other healthcare providers, with the goal of improving care while reducing costs. CMS said a “bundled” payment (i.e., one payment for multiple services) will encourage providers to work more efficiently and improve the patient’s experience of care. The more efficient the care, the more shared savings and profits the providers can receive. Quality must be high or penalties and reduced payments will result.

In the existing Medicare system, CMS makes separate payments to providers for the services they furnish to beneficiaries for a single illness or course of treatment.

What’s Up in Florida?

Florida officials have been outspoken in their criticism of the federal health reform law and say they will not implement its mandated health insurance exchanges. However, a state-promoted program from 2008 that established an insurance exchange is slowly moving ahead to provide small group coverage to Florida’s small businesses, which is needed. More to come on that.

What is the status of my new book – The New Health Age: The Future of Health Care in America?

My co-author David Houle and I are working hard to finish our new website for the book. We hope to launch within the next two weeks. We continue to receive very positive feedback from the pre-public draft edition. To be notified when the book is available visit

Legal Status of Health Care Reform

As I blogged about last week, the recent high profile decision by the Eleventh Circuit affirmed that the individual mandate under the health reform law is unconstitutional. However, the three-judge panel, which split 2-1, found that the entire Patient Protection and Affordable Care Act should not be struck down, even though the individual mandate to purchase health insurance fails on constitutional grounds. The courts are very divided, making it increasingly likely that the Supreme Court could resolve the matter, perhaps before the November 2012 election.