Question

How do provider incentives differ when the provider moves from a fee-for-service to a capitated environment?

Answer 1

In capitation system a fixed per capita payment for each service they provide by a managed care group. It offers a monthly financial guarantee for providers.

In fee-for-service, there are no fixed payments. Bill for services delivered are paid on predetermined rates for each service. They are paid according to what procedures they use to treat the patients.

Instead of consulting more patients in free-for-service system to increase revenue, in a capitated environment the provider consults less patients to reduce costs. The push would be for preventative care. Capitated environment system is a system for cost-conscious employee.

answered by: anonymous