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What are the major differences between fee-for-service and capitation payment methods? What provider incentives are created under each of these methods? Which of these two payment methods carry the least risk and the most risk for providers?

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Ritika · Accepted Answer

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Fee-for-service model stands for payment structure. It is with this model that providers tend to receive fees for each of the separate service as provided to them. There is an inherent incentive for fee for service model wherein caregivers also tend to focus on number of visits, treatments and procedures, etc. Capitation service is a performance based management system in which caregivers involve as part of the contract and even associate with independent and appropriate care and treatment. Capitation services are also of mainly three kinds such as primary, secondary and global,

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