Types of wastes in health care: - Production-level (5%) - Case-level (50%) - unnecessary or sub optimal care - Population-level (45%) - unnecessary or preventable Payment Models: - Cost Plus (small pocket prevalence, for a unit of care) - Fee for service (most common) - provide as much care as possible - gov pays the lesser of the actual charges or the federal maximum allowed rate that is not linked to underlying costs - type + volume of care vary widely making it hard to compare the true cost of care across providers - insurance companies base purchasing decisions on % discounts negotiated --> this leads to higher markups to offer larger discounts to insurers - Per case (volume based system) - Diagnosis Related Group system (Medicare patients) - Bundled payments exist