Question

In an HMO, a doctor is paid based on the number of people assigned to him or her, rather than on the number of patient visits. What is the term for the per-person fee the provider earns?

Answer 1

In an HMO, the per-person fee that a provider earns is known as capitation. This system contrasts with fee-for-service and pays a fixed amount regardless of services used, motivating providers to manage care efficiently.

Step-by-step explanation:

In a health maintenance organization (HMO), the term for the per-person fee that a provider earns is capitation. This payment model is different from the traditional fee-for-service system, where providers are reimbursed based on each service they provide to a patient. In an HMO, providers receive a fixed amount per enrolled patient, known as the capitation fee, regardless of how many services that patient uses.

This structure is designed to encourage providers to focus on preventative measures and the efficient management of care to reduce unnecessary services and costs associated with the fee-for-service model. The capitation system has implications for both healthcare access and the management of healthcare costs, affecting the economic dynamics of healthcare delivery.