Which term describes a payment system that pays a fixed amount per enrolled patient to cover a defined package of services?

• A. Capitation
• B. Fee for service
• C. Indemnity
• D. Sliding scale

Answer: (A)

Capitation is the payment model where a provider receives a fixed amount for each enrolled patient to cover a defined package of services for a set period. Because the payment is per patient regardless of how many services are used, the provider takes on the financial risk for costs within that population, which also pushes a focus on preventive and efficient care to stay within the budget. This differs from fee-for-service, which reimburses separately for each service rendered; indemnity plans reimburse after services with more patient choice; and sliding-scale arrangements adjust charges based on income rather than providing a fixed per-patient budget.