What is the term for a payment arrangement where providers are paid a set amount per patient per month, regardless of the number of services rendered?

The term for a payment arrangement where providers receive a fixed payment for each patient monthly, regardless of how many services are provided, is known as capitation. This model incentivizes healthcare providers to focus on preventive care and overall patient wellness since their payment is not based on the volume of services rendered but rather on the number of enrolled patients.

In capitation, providers assume a degree of financial risk; if a patient requires extensive care, the provider still receives the same monthly payment. This system can lead to more efficient care delivery and can help control healthcare costs by encouraging providers to manage patient health proactively rather than reacting to illness only after it occurs.

Other options such as fee-for-service involve payments based on the actual services rendered, which can lead to increased costs if many services are provided. Retrospective payment refers to reimbursement based on the costs incurred after services are delivered, and prepaid health plans generally involve a broader financial arrangement but do not specifically define the per-patient, per-month model found in capitation.