Why do HMOs prefer the prepaid, monthly premium? Is pay-for-performance a better model than existing models of compensation? Are there limitations to it as well?
The advance monthly premium makes services available easily especially in clinic settings and encourages one to come in soon to prevent a minor condition from it escalating.
I believe the pay for performance model is a better model for payment than the existing ones as the model can be viewed as a refinement of the fee for services and capitation reimbursement models. The model is limited in terms of outcome measurement as results such as clinical outcomes are difficult to measure.
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