Healthcare Finance: Regulation, Pricing, and Financial Plans

Healthcare Finance
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1. In healthcare, explain three Fraud and Abuse Regulations. Explain why they are important to providers and how they impact the financial decisions made by healthcare organizations.
Stark II
Stark II forbids physicians from referring patients to receive DHS (Designated health services”) payable by Medicaid or Medicare from entities that an immediate family member or physician is financially affiliated with unless an exception applies (Wyatt, 2007). An infraction of the Stark II law matters not if the infraction impeded on patient choice, corrupted clinical judgment, or affected the physician referral patterns. Even if the choice was voluntary or involuntary, an infraction requires reimbursement of Medicare payments; this is to prevent referrals for financial reimbursements (Wyatt, 2007). In turn, this causes providers to arrive at decisions based on the quality of care and not financial compensation.
Anti-Kickback Statute
The Anti-Kickback Statute forbids providers (including physicians) from willfully and knowingly receiving suborns or other kinds of remuneration in exchange for generating Medicaid, federal healthcare program business, or Medicare (Love, 1997). Because the Anti-Kickback Statute is a criminal statute, the penalties for violations can be severe. They include felony convictions punishable by imprisonment, exclusion from participating in Federal Healthcare Programs, and fines of up to $25,000 per violation. Providers, therefore, must understand what constitutes as a violation and must discuss the consequences of such actions with the practice.
False Claims Act
The False Claim Act makes it illegal for any individual or company to deliberately file a false claim or make a false record of any federal healthcare program (Bellamy, 2011). This includes any program or plan that offers healthcare benefits, whether directly, through insurance or otherwise, which is financed directly, wholly or partly, through insurance or otherwise, by any state healthcare system or the United States government. Violations under this act can result in significant penalties and fines. Employees of healthcare providers who have evidence of wrongdoing can bring a lawsuit. Under this act, if the case is successful and the funds are retrieved by the government, the whistleblower receives a fraction of the money recovered. This incentive increases the chances that claims will be presented – both illegitimate and legitimate claims.
2. What Factors Influence Healthcare Pricing?
Healthcare pricing is influenced by:
Healthcare technology: While technology helps to cut costs in most fields, new healthcare technologies are more complex and more costly.
Administrative obligations: Administrative costs, for instance, billing and the management of patient records, add to increasing costs for hospitals, governments, health insurance companies, and phys...