What type of reimbursement method issues lump sum payments for all health care services related to a specific illness?

What type of reimbursement method issues lump sum payments for all health care services related to a specific illness?

• A. episode-of-care (EOC)
• B. capitation
• C. fee-for-service
• D. bundled

Answer: (A)

The reimbursement method that issues lump sum payments for all healthcare services related to a specific illness is the episode-of-care (EOC) approach. This method consolidates payments to cover a defined set of services over a specified timeframe surrounding a particular episode of care, such as a surgical procedure or treatment for a specific condition. The EOC payment includes all necessary services provided to a patient, thereby promoting efficiency and cost-effectiveness by encouraging providers to deliver the necessary care without unnecessary services or procedures. This method contrasts with fee-for-service reimbursement, where providers are paid separately for each service rendered. Similarly, capitation involves a fixed payment per patient regardless of the services used, which does not conform to the lump-sum nature specific to episodes of care. Bundled payments also refer to a single payment for a group of related services but typically apply to a defined set of services for a broader condition rather than a specific episode encompassing the entirety of care for an individual illness. Thus, the EOC method specifically aligns with the idea of providing a lump sum payment tied to the comprehensive care related to a particular episode of illness.

The reimbursement method that issues lump sum payments for all healthcare services related to a specific illness is the episode-of-care (EOC) approach. This method consolidates payments to cover a defined set of services over a specified timeframe surrounding a particular episode of care, such as a surgical procedure or treatment for a specific condition. The EOC payment includes all necessary services provided to a patient, thereby promoting efficiency and cost-effectiveness by encouraging providers to deliver the necessary care without unnecessary services or procedures.

This method contrasts with fee-for-service reimbursement, where providers are paid separately for each service rendered. Similarly, capitation involves a fixed payment per patient regardless of the services used, which does not conform to the lump-sum nature specific to episodes of care. Bundled payments also refer to a single payment for a group of related services but typically apply to a defined set of services for a broader condition rather than a specific episode encompassing the entirety of care for an individual illness. Thus, the EOC method specifically aligns with the idea of providing a lump sum payment tied to the comprehensive care related to a particular episode of illness.