Author Affiliation: RAND Corporation, Santa Monica, California.
Traditionally, there have been 3 ways to reimburse physicians for services rendered: salary, capitation, or fee for service. A physician who receives a salary is paid a certain amount per month or year of work. Physicians reimbursed through capitation are paid based on the number of patients they see or the number of patients for whom they are responsible. Physicians reimbursed on a fee-for-service basis are paid for every service they provide, regardless how simple or complex.
Brook RH. Physician Compensation, Cost, and Quality. JAMA. 2010;304(7):795-796. doi:10.1001/jama.2010.1174