by Joseph J. Kempf, Jr., and Jackie Selby

Evolving reimbursement models for health care providers (away from “fee for service” and toward “pay for performance” and risk sharing) raise interesting questions as to how such payments will be treated under the new medical loss ratio rules under the Patient Protection and Affordable Care Act. Some of the payments will not qualify as “medical expense” or “quality improvement activities” and will be treated as “administrative expense,” so providers and insurers and health plans may want to take these rules into account when structuring alternative reimbursement methodologies.

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