CPB Certified Professional Biller Certification Practice Exam

What does capitation allow providers to do?

1. Charge patients based on service usage

2. Receive fixed payments for a defined period of care

3. Offer unlimited services at no additional cost

4. Adjust payments based on patient outcomes

The correct answer is: Receive fixed payments for a defined period of care

Capitation allows providers to receive fixed payments for a defined period of care, regardless of the actual number of services used by patients during that time. This payment model promotes cost predictability for providers and encourages them to focus on preventive care, as they benefit from keeping patients healthy rather than billing for each service provided. It creates an incentive for efficient and effective care, since the fixed payment may be adjusted based on a patient population's needs but not on individual service usage. In contrast, alternatives such as charging based on service usage or adjusting payments based on patient outcomes do not align with the principle of capitation.