Differentiate between fee for service, capitation, and episode-based payment

Differentiate between fee for service, capitation, and episode-based payment

Topic 6 DQ 2

Jan 20-24, 2022

Differentiate between fee for service, capitation, and episode-based payment. Describe the structure of these payment methodologies along with the benefits and potential risk of each. Keep both the provider and patient in mind when composing your answers.

REPLY TO DISCUSSION

KNOWLEDGE CHECK

Identify the primary payment mechanism for your organization. Provide discussion with response.

REPLY

Fee-for-service (FFS) directly pays Medicaid participating physicians, clinics, hospitals, and providers a fee for each service rendered (Kaiser Family Foundation, n.d.). The FFS payment model rewards volume despite a patient’s health outcomes or quality of care (Kaiser Family Foundation, n.d.). Some disadvantages of the FFS payment model are fragmented care due to lack of care coordination, care gaps, duplicate services, and high out-of-pocket costs. Many consumers favor the FFS payment method due to the ability to choose providers without restrictions despite the high costs associated with the same (Penner, 2017). Individuals still widely use FFS, and many providers also favor this payment method.

Important information for writing discussion questions and participation

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Hello class and welcome to the class and I will be your instructor for this course. This is a -week course and requires a lot of time commitment, organization, and a high level of dedication. Please use the class syllabus to guide you through all the assignments required for the course. I have also attached the classroom policies to this announcement to know your expectations for this course. Please review this document carefully and ask me any questions if you do. You could email me at any time or send me a message via the “message” icon in halo if you need to contact me. I check my email regularly, so you should get a response within 24 hours. If you have not heard from me within 24 hours and need to contact me urgently, please send a follow up text to

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Plagiarism is highly prohibited. Please ensure you are citing your sources correctly using APA 7th edition. All assignments including discussion posts should be formatted in APA with the appropriate spacing, font, margin, and indents. Any papers not well formatted would be returned back to you, hence, I advise you review APA formatting style. I have attached a sample paper in APA format and will also post sample discussion responses in subsequent announcements.

Your initial discussion post should be a minimum of 200 words and response posts should be a minimum of 150 words. Be advised that I grade based on quality and not necessarily the number of words you post. A minimum of TWO references should be used for your initial post. For your response post, you do not need references as personal experiences would count as response posts. If you however cite anything from the literature for your response post, it is required that you cite your reference. You should include a minimum of THREE references for papers in this course. Please note that references should be no more than 5 years old except recommended as a resource for the class. Furthermore, for each discussion board question, you need ONE initial substantive response and TWO substantive responses to either your classmates or your instructor for a total of THREE responses. There are TWO discussion questions each week, hence, you need a total minimum of SIX discussion posts for each week. I usually post a discussion question each week. You could also respond to these as it would count towards your required SIX discussion posts for the week.

I understand this is a lot of information to cover in 5 weeks, however, the Bible says in Philippians 4:13 that we can do all things through Christ that strengthens us. Even in times like this, we are encouraged by God’s word that we have that ability in us to succeed with His strength. I pray that each and every one of you receives strength for this course and life generally as we navigate through this pandemic that is shaking our world today. Relax and enjoy the course!

Hi Class,

Please read through the following information on writing a Discussion question response and participation posts.

Contact me if you have any questions.

Important information on Writing a Discussion Question

• Your response needs to be a minimum of 150 words (not including your list of references)
• There needs to be at least TWO references with ONE being a peer reviewed professional journal article.
• Include in-text citations in your response
• Do not include quotes—instead summarize and paraphrase the information
• Follow APA-7th edition
• Points will be deducted if the above is not followed

Participation –replies to your classmates or instructor

• A minimum of 6 responses per week, on at least 3 days of the week.
• Each response needs at least ONE reference with citations—best if it is a peer reviewed journal article
• Each response needs to be at least 75 words in length (does not include your list of references)
• Responses need to be substantive by bringing information to the discussion or further enhance the discussion. Responses of “I agree” or “great post” does not count for the word count.
• Follow APA 7th edition
• Points will be deducted if the above is not followed

• Remember to use and follow APA-7th edition for all weekly assignments, discussion questions, and participation points.
• Here are some helpful links
• The is a great resource

Capitation is a healthcare payment system that pays a fixed amount per patient for a prescribed period by an insurer or physician association to the provider or hospital rendering services (Torrey, 2020). This financing model is a risk-sharing method for the cost of care from the payer to the provider (Penner, 2017). With capitation, a provider may be penalized for the use of services that value more than the fixed payment obtained or, on the other hand, may make a profit if the patient or consumer uses fewer services. If the patient or consumer does not use services, the provider still gets the fixed fee. One advantage to clients is that duplication of services is usually avoided, but a disadvantage is that providers may decrease time spent with one client.

Episode-based payments, also known as bundled payments, were created by the Center for Medicare and Medicaid Services (CMS) and came about with the Affordable Care Act to improve patient outcomes at a reduced cost to Medicare (Forrest, 2018). With this payment method, “the total allowable remittance for a patient’s sequence of care relating to a single episode of the medical event is predetermined instead of separate compensation for each service and provider along the way” (Forrest, 2018). Unlike FFS service payment, episode-based payments reward value over volume of care, and providers receive incentives when high-quality, cost-effective care is delivered.