Name a common payment model used in health care finance.

Capitation is a common payment model in health care finance that involves paying a set amount of money per patient, per unit of time, regardless of the number of services provided. This approach incentivizes providers to offer preventive care and manage patient health effectively, as their revenue is not dependent on the volume of services rendered. It encourages efficiency and cost-effectiveness, as providers are rewarded for keeping patients healthy rather than simply performing a high volume of tests and procedures.

In contrast, value-based care focuses on patient outcomes and the quality of care rather than the number of services delivered. Pay for performance is a model where providers receive financial incentives based on the quality of care they provide, and patient-centered care emphasizes tailoring healthcare to meet the individual needs of patients. While these options play crucial roles in the evolving landscape of health care financing, capitation remains a foundational and widely-used payment method, particularly within managed care systems.