Which payment model is not based on a specific procedure or hospital stay and is paid per member per month?

• A. Capitated payment
• B. Block payment
• C. Transfer payment
• D. Bundled payment

Answer: (A)

The payment model being described is capitation. In capitation, a fixed amount is paid per enrolled member each month (per member per month) to cover a defined set of services. This payment is not linked to any specific procedure or hospital stay, so the provider must manage care within that fixed PMPM amount. Because the payment is fixed regardless of utilization, providers assume financial risk and are incentivized to focus on preventive care, chronic disease management, and efficient care coordination to avoid unnecessary costs.

Other models differ in how the payment is tied to services. Bundled payments set a single price for an entire episode of care (for example, a specific surgery and its relatedServices), rather than a monthly per-member rate. Block or global payments offer a lump sum for a defined population or period but aren’t structured as a monthly per-member amount. Transfer payments are funds moved between organizations or levels of government and aren’t a patient-centered payer model for annual or monthly care delivery.