====== Payment Model ======

A **payment model** is a structured method by which healthcare providers are reimbursed for delivering medical services. It determines **how, when, and how much** doctors, hospitals, or clinics are paid.

===== 📌 Common Types of Payment Models =====

| **Model**                 | **Description**                                                                 |
|---------------------------|---------------------------------------------------------------------------------|
| *Fee-for-Service (FFS)*   | Providers are paid for **each individual service** (e.g., test, surgery, consult). |
| *Capitation*              | Providers receive a **fixed amount per patient**, regardless of service volume. |
| *Bundled Payment*         | A **single payment** for all services tied to an episode of care (e.g., surgery + rehab). |
| *DRG (Diagnosis-Related Group)* | Hospitals receive a **fixed payment per case**, based on diagnosis and expected resource use. |
| *Value-Based Care*        | Payment is linked to **patient outcomes and quality metrics**, not just volume. |

===== 🧠 In Context =====

> “China adopted a DRG-based payment model to control inpatient surgical costs.”

This means hospitals are paid a **predefined amount** based on diagnosis (e.g., spinal tumor) rather than on each procedure, test, or implant used.

===== ⚠️ Why It Matters =====

The chosen payment model directly impacts:
  * Clinical decision-making
  * Length of stay
  * Access to complex procedures
  * Financial sustainability of high-risk specialties (like neurosurgery)

A poorly designed payment model can lead to:
  * **Overtreatment** (in FFS)
  * **Undertreatment** or **early discharge** (in DRG)
  * **Avoidance of complex patients** (in capitation)