Which Type of Payment Method Creates an Incentive to Provide

question 29

Short Answer

Which type of payment method creates an incentive to provide more preventive care?
A)Capitation
B)Per diem
C)Per case
D)Discounted fee-for-service

• A)Capitation
• B)Per diem
• C)Per case
• D)Discounted fee-for-service

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Definitions:

Direct Labor Rate Variance

The difference between the expected cost of direct labor and the actual cost incurred, measured in financial terms.

Actual Costs

The real expenses incurred in manufacturing a product, providing a service, or running a business, as opposed to estimated or budgeted costs.

Standard Costs

Pre-determined or estimated costs used for cost control and decision-making purposes, often as a benchmark for measuring performance.

Direct Labor Rate Variance

The difference between the actual cost of labor and the expected (or standard) cost, used in budgeting and cost management.