Find the Right Pace for Innovation

Philip Betbeze, for HealthLeaders Media , August 24, 2012

Fenstermaker, an 18-year veteran healthcare chief financial officer, speaks from experience. He "grew up under capitation," and says much of reform is simply capitation under another name.

The difference this time, he says, is that in the ‘90's, only part of the reimbursement system was capitated. Government-based reimbursement was largely uncapitated—especially for physicians who, when working in the hospital, were paid fee-for-service, while DRG-based payments introduced some capitation to the hospital payment portion. All of this is to say that incentives weren't aligned.

They're still not, he argues, which is why as they become more aligned through payment incentives, leaders still have the difficult determination of how to change work processes just quickly enough to keep up with the staggered pace of change among payers.

"If you move too quickly to behave as if you're capitated and the rest of the world is fee-for-service, you go broke," he says flatly. In the same breath, however, he says, "but I think there's a way."

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