Question

2. What is selective contracting as it relates to hospital services and how does it work? What are its pitfalls?

Answer 1

Selective contracting means buyers are able to exclude some of the providers from the contracts. This means that only the ones with better quality are able to get the contracts. This is also adding costs to the quality ie better facilities and qualities have a higher chances of getting the contracts which means better care of patients. It is basically a process where managed care plans enter into contracts selectively.

In case of hospitals , selective contracting means paying for treatment and physicians which are provided at a smaller scale.

Some of the pitfalls of selective contacting is that the vulnerable sections of the society may be impacted. Also some believe that the quality is also affected.

(You can comment for doubts)