Certified Revenue Cycle Representative (CRCR) Practice Exam

What characterizes Discounted fee-for-service reimbursement methodology?

1. Fixed fees for all services

2. Providers agreeing to discounted fees for services

3. Only capitation payments

4. Percentage of costs covered by insurers

The correct answer is: Providers agreeing to discounted fees for services

Discounted fee-for-service reimbursement methodology is characterized by providers agreeing to accept lower fees for the services they deliver. Under this system, providers negotiate rates with payers, which are typically less than the standard charges. This arrangement allows insurers to control costs while providing a framework for payment based on the number of services rendered. By discounting fees, both parties benefit; providers can gain volume through a steady stream of patients covered by insurance, and insurers can manage their expenditures effectively. In contrast, fixed fees for all services would imply a uniform rate that does not accommodate the variations in service complexity or provider negotiation, which doesn't align with the discounting aspect. Capitation payments represent a different payment model altogether, where providers receive a set fee per patient regardless of the care provided, rather than fee-for-service. Lastly, a percentage of costs covered by insurers describes a payment structure that doesn't inherently involve negotiation of discounted rates, focusing instead on reimbursement based on total expenses incurred.