Health Law: Impact of Bundled Payment, Misaligned Incentives in American Healthcare System, and Trump's Proposal

This article discusses the impact of bundled payment, misaligned incentives in the American healthcare system, and Trump's proposal. It covers topics such as the Affordable Care Act, violations of Anti-Kickback and Stark Laws, and the three pillars of healthcare.

Running head: HEALTH LAW
Health Law
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Table of Contents
Question 1........................................................................................................................................2
Question 2........................................................................................................................................3
Question 3........................................................................................................................................5
Question 4........................................................................................................................................6
Question 5........................................................................................................................................7
Question 6........................................................................................................................................7
Question 7........................................................................................................................................8
Question 8........................................................................................................................................8
Reference.........................................................................................................................................9

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Question 1
The five key question are-
 What will be the impact of the new sort of payment called the bundled payment?
The bundled payment form will be a different set for the traditional fee for the service.
This plan will reimburse the healthcare providers for the individual expenses,
rehabilitation, medications and the episodic care.
 How the bundled payment intends to achieve higher quality and efficient form of care?
The bundled payment system will improve the payment system and it will reduce the
variation in spending. The various sources of variations include the number of
readmissions, joint replacement surgeries.
 Why is it necessary to consider the complexity before considering the associated costs?
The Medicare has the provision of assigning a specific price for each episode of hospital
spending. But the spending gets influenced by the usage of the service and the underlying
medical complexity.
 What will happen to these programs and how people think about such payment schemes?
The future of the bundled payments scheme is a bit uncertain even if some of the
hospitals are still applying it. The hospitals have invested a significant amount of money
so that care system can be redesigned.
 How the bundled payment scheme will handle the disputes that often arise in healthcare?
It has been seen that the often there are issues that arise due to the ineffective healthcare
provision and healthcare delivery. This in the near future will create confusion between
the healthcare providers and care receivers.

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Question 2
It is important to note that the there is nobody that can defend the American healthcare
system. Each and every form of the incentives are misaligned. The patients have a very little
scope with the services that they are using or the costs that they are paying for an unhealthy life
lifestyle. Under the aegis of fee for the service the hospitals and the doctors receive more money
for what they do. The doctors and the hospitals have the fear of the random lawsuits and this
makes them to practice a defensive type of medication. The insurance companies make more
amount of money by delaying the number of the claims. It is considered that the misaligned
incentives are the only thing responsible for the inefficient American healthcare system. The
health care provisions costs around 8000 dollars for a single person and this costs twice what
other countries spend. The health care alone has led to the increase in the trillion-dollar deficit in
the American healthcare system. The federal government of United States pays one third of the
national healthcare bill though the provisions of the Medicare and Medicaid. He healthcare
system instead of aligning to the healthcare incentives manages to reduce the costs through the
bureaucratic restrictions (Patel & Rushefsky, 2014).
The Patient Protection and Affordable Care Act (PPACA) which is in short called as
Affordable Care Act (ACA). This act is also called as the Obamacare and it is about the ensuring
that the Americans have an equal access to the healthcare. The healthcare offers benefits for the
Americans and also offers certain discounts on the government sponsored healthcare insurance
plans (Jones, Bradley & Oberlander, 2014). The biggest disadvantages of the Obamacare include
are as follows:
 Around 15 million Americans have lost their job due to the employment based health
incentive. Many different business entities have found it a cost effective alternative to

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purchase the insurance plans. While the other smaller businesses have the other plans to
go through the other state run objectives.
 30 million people relied on the private health insurance plans and the insurance
companies have cancelled the many of the plans and due to the fact that ACA’s benefits
are not covered in the private plans. There were services that are provided by ACA and
are not required like the maternity care (Béland, Rocco & Waddan, 2016).
 The increased coverage of the Obamacare also led to the rise in the healthcare costs for a
short period. The reason being people received the preventive care for the first time and
the it turned out to be expensive to treat the illness that have remained ignored for
decades.
 The pharmaceutical industries paid an extra amount of the 84.8 billion dollars between
the period of 2013 to 2023. This has led to the rise in the cost of the drugs and it is borne
by the customers.
This example of Obamacare is chosen because it has led to an increase in the burden of
the American citizens. The cost of the healthcare has increased and along with it cost of the
drugs. This is entirely borne by the common people, and thus can be said that the incentive is
misaligned. The possible fixes for the Obamacare so that it can address the issues of misaligned
incentives include the following. Firstly, more number of states must emulate Oregon, Minnesota
an Alaska and initiate the reinsurance programmes to pay for the higher costs incurred from the
Obamacare. Law prohibits discrimination against the patients that are already having worse
health conditions. Thus, a s a result the health premiums have increased for the ones that have
higher income and for this reason they do not receive the government subsidy. Secondly, that
states must open the government contracts for the different types of the programs like Medicaid.

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This will be done so that the insurers can take part actively in the exchanges (Manchikanti &
Hirsch, 2012). These kinds of rules are already present in the Nevada and New York. lastly the
Trump administration must fulfil the responsibilities of the federal government and this means
that the Trump administration must enforce the rules mention in the Obamacare provision. At the
same time the reform will fine those people that are unwilling to buy the health insurance
programs. The Medicare must be allowed to implement a marketing program that will entice the
younger people in to the universal coverage of healthcare (Oberlander, 2012).
Question 3
 Answer A: The potential benefit for the ASC by accepting the opportunity will include a
yearlong fixed generation of revenue from the insurance company. This will benefit the
ASC even if the number of patients visiting ASC reduces.
 Answer B: The potential financial risks associated with this opportunity will include
fixed generation of revenue even if the number of the patients that are visiting the ASC
increases. The rise in the number of the patients will only lead to more work pressure for
the ASC but it will not generate any extra revenue for the ASC.
 Answer C: the ASC earns an average of 7500 dollars for every surgery under the regime
of FFS. While under the sole source regime the ASC will receive 7400 dollars for each
case. This is although 100 dollars less than what they used to receive. But it is important
to mention that even though the count of the surgery reduces, still ASC is going to
receive a lump sum amount for a single year from the sole source. Thus, it is a good deal
for ASC to accept the contract of the sole source.
 Answer D: There might be legal risk associated with the proposal and the legal risk will
adhere to the payment of the lump sum amount even though ASC receives less number of

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patients in a yearly basis. Disputes might arise regarding at the stages where the ASC
does not receive the number of the patients equalling the amount of the money it receives
for a single year.
Question 4
Answer A: The mentioned case is a violation of the Anti-Kickback Law because in general the
pharmaceutical company offering bribes to the physician for prescribing the medicine to a single
patient. The physician receives an amount of 75 dollars and this will be considered as a bribe
(Taormina, 2013).
Answer B: The mentioned act of prescribing a drug and receiving cash benefits for the same is a
gross violation of the Stark Law. The Stark Law inhibits a physician from accruing benefits by
prescribing medicine of a pharmaceutical company from which it is receiving benefits. Although
the company is providing the free samples, the samples contain insufficient amount of medicine
which is not again not able to cure or treat a particular health issue (Emanuel et al., 2012).
Answer C: The physician has the authority and discretion to prescribe a medicine so that a
patient can have their health issue treated and cured. However, it is important to mention that a
physician receiving money for prescribing a particular medicine is not at all a healthy practice.
The money that the physician is receiving is an unaccountable money and provides the physician
to evade tax.
Answer D: The pharmaceutical company spends a total of 300 million dollars for the
pharmaceuticals for the indigent patients. This can obviously be considered as a charity care and
the desire of the company to issue a tax exempt for the capital requirements of drug production.
Yes, the company can do this considering the huge sum of money that the company is spending.

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Question 5
The three sides of healthcare are cost, quality and access and this concept is interlinked
together because the cost of healthcare is dependent on the quality of the healthcare provided by
the healthcare provider. On the other hand, healthcare must be accessible to wider population
which is again dependent on the cost and the quality. The concepts are inextricably interlinked
because the links or the bonds that have held the three sides together can be severed. It is also
important to note that the to make a healthcare accessible, the cost and the quality of the
healthcare drops at the same time (Edes et al., 2014).
Question 6
The impact of the proposal of the patients: the executive order will negatively impact the
marginalized communities and it poses as a threat for the people with the disabilities and it is one
of the biggest con. This will force the healthy people to buy the healthcare plans that are less
comprehensive. The bigger issue is that the executive order will remove the people that were
previously under the Affordable Care Act. This action in turn will act as a burden for the
disabled and the sick people. The executive order will effectively provide the people that are not
disabled with the choice to but insurance plans. Such plans will include high amount of premium
and coverage for the people that are disabled and it will increase in the future. It is even
predicted that if the previous law of Obamacare is repealed then the medical expense will rise
significantly and this means that the people with kidney cancer can expect an increase a
surcharge of 703 percent. While the people that have a depressive order will face an increase of
208% of surcharge. The biggest pros of the Trump’s proposal are that the people that are self-
employed and small business employees are the most affected by Obamacare. While repealing
the same will be beneficial for such people (dailysignal.com., 2018).

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The impact of the proposal on the providers- The proposal is a clear indication that
Trump administration wants to repeal the ACA and it will not penalize the one that does not have
the health insurance. Whereas, it will penalize the health care providers with the high cost of
Medicare and it is one of the biggest con. This will slow down the activity of the health care
providers and also participate in the risk programs unless and until the future is clear. One of the
pros of the Trump’s proposal is that healthcare providers will now have to deal with less hassle
in terms of the number of the healthcare insurances (Dyrda, 2018).
Question 7
The statement is true because the bond issued by the tax exempt company will always
pay a lower amount of interest (Mellon, 2016).
Question 8
The health care system is a robust which include plenty of factors and parameters within
the health care. The healthcare system include the three basic pillars called the cost, quality and
access. This particular aspect is chosen because the healthcare is an intrinsic part of human’s life.

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Reference
Béland, D., Rocco, P., & Waddan, A. (2016). Obamacare wars: federalism, state politics, and
the affordable care act. University Press of Kansas.
dailysignal.com. (2018). Why Trump’s Executive Order on Health Care Is a Positive Step.
Retrieved from https://www.dailysignal.com/2017/10/12/trumps-executive-order-health-
care-positive-step/
Dyrda, L. (2018). What President Trump's executive order means for hospitals & physicians: 14
key thoughts. Retrieved from https://www.beckershospitalreview.com/hospital-
management-administration/what-president-trump-s-executive-order-means-for-
hospitals-physicians-14-key-thoughts.html
Edes, T., Kinosian, B., Vuckovic, N. H., Olivia Nichols, L., Mary Becker, M., & Hossain, M.
(2014). Better access, quality, and cost for clinically complex veterans with home‐based
primary care. Journal of the American Geriatrics Society, 62(10), 1954-1961.
Emanuel, E., Tanden, N., Altman, S., Armstrong, S., Berwick, D., de Brantes, F., ... & Daschle,
T. (2012). A systemic approach to containing health care spending. 949-954
Jones, D. K., Bradley, K. W., & Oberlander, J. (2014). Pascal's Wager: health insurance
exchanges, Obamacare, and the Republican dilemma. Journal of Health Politics, Policy
and Law, 39(1), 97-137.
Manchikanti, L., & Hirsch, J. A. (2012). Obamacare 2012: prognosis unclear for interventional
pain management. Pain Physician, 15(5), E629-40.
Mellon, A. W. (2016). Taxation: the people’s business. Pickle Partners Publishing.

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Oberlander, J. (2012). The future of Obamacare. New England Journal of Medicine, 367(23),
2165-2167.
Patel, K., & Rushefsky, M. E. (2014). Healthcare politics and policy in America. Public
Integrity, 17(1), 94-96.
Taormina, M. (2013). The Stark truth: what your physician clients should know about Stark Law
and the Anti-Kickback Statute. J Health Care Finance, 39(3), 85-92.