Slicing the pie

Case rate contracts take the onus of dividing payment from the insurer and places it on the provider. There are a number of methods which can be used to respond to this challenge. One method which has a number of significant advantages is the floating conversion factor reimbursement method. It is based on a very simple concept, is transparent and delivers the market reality of the plan performance directly to participating physicians, without any convoluted calculations or cushions in between. A withhold can be added to this method, though it is unnecessary. A profit/loss sharing plan with the hospital can be helpful in completing the alignment of incentives.