Fee-for-Service vs. Value-Based Healthcare Models and Patient Impact

Fee-For-Service Healthcare Model

The critical difference between fee-for-service and value-based healthcare models is their payment strategy and influence on the quality of healthcare services. A fee-for-service healthcare model compensates healthcare practitioners for each treatment or operation (Moen, 2018). This implies that each medical test, doctor’s visit, surgical operation, medicine, or therapy is billed separately. The patient or their insurance company pays for each service. It is essentially an “à la carte” system in which patients pay for what they receive.

Value-Based Care Model

On the other hand, the value-based care approach moves from paying for specific services to paying for the value and results of treatment (Moen, 2018). According to this paradigm, healthcare providers are rewarded for providing high-quality treatment, which leads to better patient outcomes and lower healthcare expenditures over time.

Examples of Fee-For-Service Model

As an example of a fee-for-service paradigm, one can consider a case of a patient suffering from chronic back pain. They arrange to see their primary care physician to discuss their issues. During the appointment, the doctor suggests that the patient undergo multiple diagnostic procedures, such as an MRI, X-rays, and blood work, to determine the source of the pain. Each of these tests has its own cost, which may or may not be covered by the patient’s insurance. After evaluating the test findings, the doctor refers the patient to a spine surgeon for additional examination. The surgeon believes surgery is the best way to treat the back discomfort. The patient has surgery, which is paid separately, and then follows up with paid physical therapy sessions to help recover.

Benefits of Value-Based Healthcare Model

The value-based paradigm benefits patients. Patients obtain better-coordinated treatment from several healthcare professionals, minimizing the likelihood of redundant services (Moen, 2018). As the goal is to achieve better health outcomes, value-based care encourages individuals to be more involved in their healthcare decisions and treatment plans (Moen, 2018). Now, patients can comprehend the charges since they are generally offered a single, bundled fee rather than a slew of bills.

References

Moen, S. (2018). Fee for service vs. value based healthcare [Video]. YouTube. Web.

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StudyCorgi. (2025) 'Fee-for-Service vs. Value-Based Healthcare Models and Patient Impact'. 16 March.

1. StudyCorgi. "Fee-for-Service vs. Value-Based Healthcare Models and Patient Impact." March 16, 2025. https://studycorgi.com/fee-for-service-vs-value-based-healthcare-models-and-patient-impact/.


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StudyCorgi. "Fee-for-Service vs. Value-Based Healthcare Models and Patient Impact." March 16, 2025. https://studycorgi.com/fee-for-service-vs-value-based-healthcare-models-and-patient-impact/.

References

StudyCorgi. 2025. "Fee-for-Service vs. Value-Based Healthcare Models and Patient Impact." March 16, 2025. https://studycorgi.com/fee-for-service-vs-value-based-healthcare-models-and-patient-impact/.

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