Which term is an episode-of-care reimbursement type?

Which term is an episode-of-care reimbursement type?

• A. Self-pay
• B. Prospective payment
• C. Capitation
• D. Global payment

Answer: (B)

The idea being tested is payments that are set in advance for a defined period of care—the episode of care. When a payer uses a prospective payment approach, the amount is determined before treatment begins and is based on the expected resources for that particular episode (for example, a diagnosis or procedure). This shifts some financial risk to the provider, since they must work within the fixed amount regardless of the actual services used. This is why the correct term is prospective payment. Self-pay refers to the patient paying out of pocket with no third-party rate-setting. Capitation pays a fixed amount per patient per month regardless of the number or type of services, not a single episode. Global payment covers all care for a defined population over a period, which is broader than a single episode.

The idea being tested is payments that are set in advance for a defined period of care—the episode of care. When a payer uses a prospective payment approach, the amount is determined before treatment begins and is based on the expected resources for that particular episode (for example, a diagnosis or procedure). This shifts some financial risk to the provider, since they must work within the fixed amount regardless of the actual services used.

This is why the correct term is prospective payment. Self-pay refers to the patient paying out of pocket with no third-party rate-setting. Capitation pays a fixed amount per patient per month regardless of the number or type of services, not a single episode. Global payment covers all care for a defined population over a period, which is broader than a single episode.