Which of the following is NOT a capitation-based payment model?

• A. Capitation
• B. Discounted Fee-For-Service
• C. Pay-For-Performance Incentives
• D. Fee-For-Service

Answer: (D)

The essential idea here is how payment is structured in managed care: capitation-based models give providers a fixed amount per enrolled member for a period to cover a defined set of services, shifting financial risk to the provider. In contrast, Fee-for-Service pays providers for each individual service delivered, with payment tied to every procedure, visit, or test rather than to a member’s enrollment or a bundled set of services. That per-service, activity-based payment is what makes it not capitation-based.

Discounted Fee-For-Service can still be seen within a capitated-style contract because it uses a negotiated rate for services, but the base payment remains tied to services rendered rather than a fixed per-member amount. Pay-for-performance incentives are typically layered on top of capitation arrangements to reward quality and outcomes, rather than paying per member for a bundle of services. So the option that most clearly is not capitation-based is Fee-for-Service, since it lacks the fixed per-member framework that defines capitation.