Methods of Payment Analysis - Essay Example

The healthcare conditions of the populace have always been the concern of all governments; past and present. For this reason, there are always reviews of the healthcare system to ensure that the people of the nation have what is expected when it comes to the provision of quality health. One of the healthcare reviews has led to the introduction of the healthcare payment system. In this survey, five (5) major methods of payments to healthcare providers shall be critically analyzed in terms of what they represent, the impact of the methods on the organization’s financial viability, what the methods favour and disfavour and finally how the methods influence the sustainability of the healthcare providers. Below are the detailed analyses.

Some session of healthcare recipients finance the cost of their healthcare by themselves; as and when they receive healthcare. This is commonly referred to as self-pay. Pretty (2008) explains that “self-pay is simply the payment for a one-off surgery directly and is also becoming popular with a wide and diverse cross-section of society”. There are two major financial impacts of the self-pay method. First, it does not guarantee bulk pre-determined working capital for the organization. Second, it is a sure way of being assured that healthcare services given will be paid for. For this reason, the organization is challenged to spend within its means. The method does not favour healthcare recipients who do not have a guaranteed source of income regularly. For this reason, it is good and favours people who have the means to give out payment as and when it becomes necessary. In terms of long-term planning, this method does not influence the sustainability of the healthcare provider positively because of the absence of a pre-assured source of capital.

Contrary to paying for healthcare services on the reception of healthcare, other people get insured for their health such that they do not have to pay money ‘hands-on’ when they receive healthcare services. To this end, Investopedia (2011) explains that commercial healthcare insurance is “a type of health insurance that covers medical expenses and disability income for the insured”. The impact of this method on an organization’s financial viability is that it provides a platform for advanced capital amassment for the planning of the organization. Commercial healthcare insurance favours people who are not in a position to give out money any time they have to receive healthcare. It however does not favor people who may be having chronic diseases that are not covered under the insurance scheme. Commercial healthcare insurance if well managed is a sure way of sustaining healthcare providers because they can always be assured of advanced payment of health services given.

Medicare is a social insurance intervention by the government for people who fall within certain criteria. The common criteria used are people who are over 65 years old or those below that age but have been diagnosed with permanent physical disabled or congenital physical disability (Medicare.gov, 2011). Since this method is run by the government, healthcare organizations are mostly challenged with payment because government naturally has a lot of agenda on its budget, which it has to attend to with equal importance. This method favours only a limited number of healthcare recipients – that is those defined by the system. Until government shows great commitment to how it plans to sustain the system, the Medicare payment method threatens the sustainability of healthcare providers.

As the name implies, Medicaid is a form of healthcare payment method that seeks to offer healthcare payment aid to a group of people. Medicaid is a program for New Yorkers who can't afford to pay for medical care.