What is a key benefit of a fee-for-service payment model?

A key benefit of a fee-for-service payment model lies in the direct correlation between the services rendered and the payment made. This model stipulates that healthcare providers receive a fee for each specific service they provide, which incentivizes them to deliver more services. It allows for clear and straightforward billing, where the remuneration is directly linked to the level and volume of care the provider offers.

This system effectively quantifies the service delivered, making it easy to assess individual provider performance based on the services that have been billed. It creates an environment where there is a financial incentive to conduct tests, procedures, and consultations, thus ensuring that providers are compensated for the work they perform.

In contrast, other payment models, such as capitation or bundled payments, may offer different incentives, focusing more on population health outcomes or a group of services rather than individual activities, which can shift the dynamics of payment away from direct service correlation.