BHA FPX 4009 Assessment 2 Reimbursement Options

BHA FPX 4009 Assessment 2 Reimbursement Options


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Capella university

BHA-FPX4009 Health Care Reimbursement Systems

Prof. Name



This paper provides an overview of various reimbursement options in healthcare and explores different payment models. Additionally, it discusses the drawbacks and impacts on reimbursement rates associated with fee-for-service, capitation, pay-for-performance, and resource-based relative value scale (RBRVS) models. Furthermore, this paper evaluates alternative payment options for uninsured patients, including Medicaid, self-pay, and financing options.

Part I – Provider Reimbursement Options


Fee-for-service (FFS) is a reimbursement model where healthcare providers receive payment for each service rendered based on charges or a fee schedule (Rosenthal, 2007). The fee schedule outlines fees allowed by third-party payers for healthcare services (Casto, 2019A). Critics argue that FFS lacks incentives for cost control and may lead to overutilization of services (Casto, 2019A). Providers can increase revenue by offering more services per patient, but reimbursement depends on the complexity of care provided (Fearnley, 2016). While FFS is widely used globally, countries adopt variations based on their healthcare systems and funding sources (Ikegami, 2015). For instance, Canada employs a hybrid model combining social insurance and national health services (Casto, 2019A).


Capitation involves fixed payments per person per month (PMPM) to healthcare providers, irrespective of services provided (Casto, 2019A). Providers may avoid high-cost patients to maximize profits under this model (Casto, 2019A). However, predicting reimbursement becomes challenging due to the fixed nature of payments (Fearnley, 2016).


Pay-for-performance incentivizes quality care delivery through financial bonuses (McKethan & Jha, 2014). It focuses on patient outcomes, processes, and experiences (Mongan et al., 2008). Programs like the Hospital-Acquired Condition Reduction Program aim to improve care quality by penalizing certain conditions (Pay for Performance Reimbursement, 2019). This model aligns with efforts to improve quality while controlling costs (Rosenthal, 2007).

Resource-Based Relative Value Scale

RBRVS reimburses healthcare services based on resources required and service units’ appropriate prices (Casto, 2019B). Implemented in 1992, RBRVS aims to standardize physician payments (DeVries, 2019). Reimbursement is calculated using a formula incorporating relative value units and practice expenses (DeVries, 2019).

Part 2 – Payment Options for Uninsured Patients

Identifying and Explaining Payment Options for Uninsured

Medicaid provides coverage for low-income individuals and families (Casto, 2019A). Despite efforts to expand insurance coverage, options like Medicaid remain crucial for the uninsured (Rosenthal et al., 2016). Additionally, financing options and self-pay discounts are available. Financing companies may offer payment plans based on income, while self-pay patients can negotiate discounted rates (Lamberti, 2021).


Healthcare reimbursement models significantly impact patient care and organizational finances (Casto, 2019A). Understanding these models is essential for optimizing service delivery and reimbursement. While traditional models persist, there’s a shift towards performance-based models to enhance quality and control costs (Rosenthal, 2007).


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Casto, A. B. (2019A). Chapter 1, “Healthcare Reimbursement Methodologies.” Principles of healthcare reimbursement (6th ed.). AHIMA Press. Pages 1-19.

Casto, A. B. (2019B). Chapter 7, “Ambulatory and Other Medicare-Medicaid Reimbursement Systems.” Principles of healthcare reimbursement (6th ed.) AHIMA Press. Pages 139-194.

DeVries, T. (2019). RBRVS Overview. MD Management Group. Retrieved from

BHA FPX 4009 Assessment 2 Reimbursement Options

Fearnley, A. (2016, April 7). Capitation vs. Fee-for Service Healthcare Payment Models. PrognoCIS. Retrieved from

Ikegami, N. (2015). Fee-for-service payment- an evil practice that must be stamped out? Int J Health Policy Manag. 4(2), 57-59. Retrieved from

Lamberti, P. (2021). What to do When You Get Medical Bills You Can’t Afford. Money Under 30. Retrieved from

Mckethan, A., & Jha, A. K. (2014). Designing smarter pay-for-performance programs. JAMA, 312(24), 2617-2618.

Mongan, J. J., Ferris, T. G., & Lee, T. H. (2008). Options for slowing the growth of health care costs. The New England Journal of Medicine, 358(14), 1509-1514.

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Rosenthal, M. B. (2007). Pay for performance and beyond. Expert of Pharmacoeconomics & Outcomes Research, 7(4), 351-355.

BHA FPX 4009 Assessment 2 Reimbursement Options

Rosenthal, M. B., Landrum, M. B., Robbins, J. A., & Schneider, E. C. (2016). Pay for performance in Medicaid: Evidence from three natural experiments. Health Services Research, 51(4), 1444-1466.

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