Spending much of her time on issues of payment redesign, Dr. Kane emphasized the need to reform fee-for-service payment, which, she said, doesn’t reward quality of care but instead encourages volume of services. Fee-for-service payment may actually reward poor quality of care-because the sicker a patient is, the more the system pays the providers.
The unit of payment needs to change, she said. One proposed way to change the method of payment would be to bundle payments around the episode of care and hold physicians and physician groups responsible for the cost and quality of the bundle of care.
According to Dr. Kane, this type of payment method would discourage physicians from performing services that do not add value to patient outcomes.