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Health Finance and Reimbursement

Health Finance and Reimbursement

Creation of A Subpanel of Physicians To Participate in The Capitation Contract

Ordinarily, PHS’s physicians, particularly in primary care, are considered as the most suitable caregivers for delivering care services to plan patients. The PHO does not have the power or strength to change to support capitation unless granted the opportunity to exercise exclusive negotiation rights for a particular duration whenever pursuing any form of contract opportunity (Maestas, 2018). Jacobson and Pomfret (2017) posit that PHO is desirable within the healthcare setting considering that it provides the opportunity for packaged and capitated pricing. Its contracts represent a potent potion of the practitioners and hospital business. In recommendation, Santa Fe Healthcare ought to work with established physicians subpanels to attend to plan patients considering that many of the hospital departments operate as independent or individual cost centers. Often, independently functioning departments do not acknowledge or recognize revenue streams.

Subpanels are highly desirable because they make it possible to vary the departments’ budget depending on changes in demand and volume. However, creating subpanels is both time-consuming and costly. This is in view that the hospital managers must dedicate much of their time and effort in educating various departmental managers on issues such as the unit cost management. Pertaining to the Santa Fe Healthcare scenario, the top management must implement subpanels comprised of hospital administrators, primary care physicians, specialists, and personnel from all departments. With an effective system of subpanels, therefore, Santa Fe Healthcare will gain an advantage as well as the information needed to negotiate adequate contracts within the healthcare industry (Kostyack, 2015). Considering that the benefits of having subpanels of PHO override the limitations or disadvantages, it is evident that these must be created to handle all categories of patients rather than restricting them to plan patients.

Measures to Ensure the PHO-Plan Contact is Successful

For the certainty of effective service delivery, the PHO must be in consistent contact with the plan. Mostly, the contract between the PHO and the plan depends on a myriad of factors. This is in view that it is seemingly easier to create subpanels amongst specialists compared to primary care physicians (Dame, 2016). For the certainty that the contract between the PHO and the plan, it is paramount that the specialists are polled to determine whether individuals are willing to continue serving the plan’s members. This is an essential concern considering that reimbursements continue to decline over time. Nevertheless, enough members must be recruited from each specialty into specialty subpanels. The information system in place must be sufficiently developed for the certainty that data is not lost or manipulated deceitfully (Hacker & Marmor, 2016). The overall goal must be to ensure effective management of healthcare systems for the certainty of improved quality of care.

Personal Opinion and Observations

For successful management of the full-risk contract, the management at Santa Fe Healthcare must ensure that there are enough amounts of covered lives, which is crucial for the certainty that specialty groups are reimbursed adequately. Secondly, the financial directors at Santa Fe Healthcare must regularly review the organizational model for the assurance that the organization maintains a high level of employee motivation, which is essential for effective service delivery. Thirdly, the management personnel in healthcare instructions must continually review the model of operation for the certainty that all capitation funds are tapped into to ensure that physicians get fair reimbursement for their services. With consideration of specific conditions and circumstances, the management in every healthcare institution must analyze the plans’ constituents to ensure the vitality of contractual arrangements.


Dame, L. A. (2016). The emergency medical treatment and active labor act: The anomalous right to health care. Health Matrix8, 3.

Hacker, J. S., & Marmor, T. R. (2016). How not to think about managed care. U. Mich. JL Reform32, 661.

Jacobson, P. D., & Pomfret, S. D. (2017). Form, function, and managed care torts: achieving fairness and equity in ERISA jurisprudence. House. L. Rev.35, 985.

Kostyack, P. T. (2015). The emergence of the healthcare information trust. Health Matrix12, 393. Maestas, A. M. (2018). Balancing billing: The ban on unfair billing practices increases tension between cost control and quality care. T. Jefferson L. Re

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