In a Fee-For-Service Payment Environment, What Incentives Do the Physicians

question 12

Multiple Choice

In a fee-for-service payment environment, what incentives do the physicians have?

• A) To perform the most possible services, because the more they do, the more they are paid
• B) To do the most complex thing, regardless of need, because they will get paid more
• C) To try to do as many procedures as possible in the shortest amount of time, because the more they do, the more they will get paid.
• D) All of these are correct.

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Definitions:

Total Fixed Cost

The sum of all costs that remain constant regardless of the level of production or output in the short term.

Marginal Product

The additional output that can be produced by adding one more unit of a specific input, holding all other inputs constant.

Total Cost

The total of all costs associated with producing goods or services, encompassing both constant and fluctuating expenses.

Total Variable Cost

The overall expense that changes in direct proportion to the quantity of output produced or services offered.