Reimbursement
Reimbursement
Reimbursement (/riːɪmˈbɜːrsmənt/) is a term used in the healthcare industry to describe the process of paying an individual or a party an amount of money that has been spent or lost; to refund.
Etymology
The term 'reimbursement' is derived from the Middle English word 'imburse' which means 'to put in a purse'. The prefix 're-' was added in the 15th century, changing the meaning to 'put back in a purse'.
Definition
In the context of healthcare, reimbursement refers to the payment that healthcare providers receive for the services they provide to patients. This payment is often made by a third-party payer, such as an insurance company or a government program like Medicare or Medicaid.
Related Terms
- Healthcare Provider: A person or organization that provides health care services.
- Third-Party Payer: An entity (such as a health insurance company or government program) that pays medical claims on behalf of the insured.
- Medicare: A federal program that provides health coverage for people aged 65 or older or with certain disabilities.
- Medicaid: A joint federal and state program that helps with medical costs for some people with limited income and resources.
Reimbursement Process
The reimbursement process begins when a healthcare provider delivers services to a patient. The provider then submits a claim to the third-party payer, detailing the services provided and the cost. The third-party payer reviews the claim and, if approved, sends payment to the provider. This process can vary depending on the specific policies and procedures of the third-party payer.
Types of Reimbursement
There are several types of reimbursement in the healthcare industry, including fee-for-service, capitation, and bundled payments. Each type has its own method for calculating payment amounts and can have different impacts on the cost and quality of healthcare.
- Fee-for-Service: This is a payment model where services are unbundled and paid for separately. In healthcare, it gives an incentive for physicians to provide more treatments because payment is dependent on the quantity of care, rather than quality of care.
- Capitation: A payment arrangement for health care service providers such as physicians or nurse practitioners. It pays a set amount for each enrolled person assigned to them, per period of time, whether or not that person seeks care.
- Bundled Payments: Also known as episode-based payment, bundled payments are a form of reimbursement in healthcare where different healthcare providers receive a single payment for all the care provided for a patient's specific condition or treatment over a set period of time.
External links
- Medical encyclopedia article on Reimbursement
- Wikipedia's article - Reimbursement
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