The Voucher Concept

At the core of voucher and accreditation programs is a performance-based contract with facilities and vouchers distributed to patients that entitles the bearer to choose care from any contracted health center. Healthcare providers must meet high quality standards to join and then compete to diagnose and treat patients in exchange for the voucher. The vouchers’ cost to the patient is heavily subsidized; in some programs it is free. The provider is reimbursed at a negotiated rate that reflects the cost of service provision and a reasonable profit. Service providers are reimbursed only after verification of contractually delivered services. Voucher programs are designed with several objectives in mind: to give patients the economic power to demand high quality healthcare, to target high risk or low income patients for critical services, to augment general population utilization rates, and to contain per-unit costs. When a voucher scheme is built on the principle of competition, it may not only further empower clients but also give incentives for service providers to be innovative, cost effective, and responsive to the clients. The graph below illustrates how vouchers work.