Author: Glossary

An institution for furnishing primary care. A PCC may be free-standing or part of another institution.  

A condition in which a seller can increase revenue by raising prices. Managed competition seeks to avoid price-inelasticity.  

Two or more competitors agreeing on prices (charges). Price-fixing is a per se violation of the Sherman Act, an antitrust law.  

A condition in which a seller can increase revenue by reducing prices (achieved, of course, by increased volume of sales). Under managed competition, price-elasticity is a specific goal.  

A method of adjusting a hospital’s price for a given Diagnosis Related Group (DRG) under the prospective payment system (PPS) after comparing the hospital’s cost per case for that DRG with the national average for the same DRG.  

The amount of money to be paid for something. Each Diagnosis Related Group (DRG), for example, carries a price, the amount of money to be paid for the hospital care of a patient classified to that DRG.  

When used in conjunction with physicians’ fees, “prevailing” refers to the charges made for the service in question in the area, provided by physicians of similar specialty qualifications.  

A contractual arrangement for health care in which a pre-negotiated payment is made in advance, covering a certain time period, and the provider agrees, for this payment, to furnish certain services to the beneficiary, member, or enrollee.  

A form of health care plan in which certain physicians are designated by a third party payer as preferred providers whom the payer has concluded are the most cost-effective. When a beneficiary elects to receive care from these physicians, the physicians’ charges are paid in full—there is no additional charge to the beneficiary. The beneficiary…

A form of organization for physician services, in a health care plan, in which the plan (the third party payer) establishes a roster of physicians who are believed to be cost-effective. All services covered by the plan, when furnished by these physicians, are without charge to the beneficiary. The beneficiary may elect care from physicians…