What are the primary payment structures used in a fee-for-service model?

In a fee-for-service model, the primary payment structures typically allow healthcare providers to receive payment for each individual service they perform. This model is based on a system wherein the patient or insurance company reimburses the provider for each specific service provided, thus incentivizing the delivery of more services.

Discounted rates from physician fee schedules are a core component of this model as they establish a standard fee for various services rendered by healthcare providers. This means that even in a fee-for-service framework, providers often negotiate or agree upon discounted rates based on the established fee schedules, ensuring that the reimbursement process is predictable and manageable for insurers and healthcare organizations alike.

In contrast, flat monthly fees, pay-per-visit charges, and capitation payments represent different payment methodologies. Flat monthly fees are more aligned with subscription or membership-based models, pay-per-visit charges can refer to certain limited interactions outside of the overarching fee-for-service model, and capitation payments involve a fixed amount paid per patient, regardless of the number of services provided, straying from the core tenets of fee-for-service practices.