What is a way to achieve payment reform?

• A. Providers move away from fee-for-service toward bundled payments systems
• B. Maintain fee-for-service with no changes
• C. Increase the use of capitation only
• D. Replace all reimbursement with salary payments

Answer: (A)

Shifting from paying for each individual service to a bundled payment for an entire episode of care aligns financial incentives with value. With a bundled payment, the care team receives one comprehensive amount for a defined episode (for example, a surgical procedure and its post-acute care), encouraging better coordination, standardization of care pathways, and elimination of unnecessary tests or steps. This approach targets total costs and outcomes, which is the essence of payment reform.

Keeping the current fee-for-service model doesn’t change incentives and thus doesn’t reform how care is paid for. Increasing capitation alone is another reform approach, but relying exclusively on capitation can transfer risk to providers and may risk under-provision without proper quality safeguards. Replacing all reimbursements with salary payments removes the pay-for-performance or episode-based incentives that reform aims to implement. Bundled payments directly embody the shift toward value and cost control in a practical reform strategy.