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Fee for service
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Fee for service refers to a method in which medical providers are paid for each service performed.[1]
Overview
In a fee-for-service health insurance system, healthcare providers are paid for each distinct service they perform. This differs from other reimbursement systems such as bundled payments, which pay providers for the totality of services rather than individual services. The passage of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) in April 2015 created two payment tracks for providers: Merit-Based Incentive Payment System (MIPS), a system which tied Medicare reimbursement to healthcare outcomes, and alternative payment models (APMs), which accounted for all other methods besides MIPs and traditional fee for service. According to the American Hospital Association, these changes were expected to move payments away from fee for service to other methods.[1][2]
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