What is fee-for-service (FFS)?

Fee-for-service (FFS) is a provider reimbursement model in which services are unbundled and billed separately. This model rewards clinicians for reporting a higher volume of treatments. Alternative models include bundled payments, patient-centered medical homes, and accountable care organizations.

Why is Fee-for-service (FFS) important in healthcare?

FFS is the dominant reimbursement model in the U.S. currently. However, incentivizing higher volumes of treatments means that patient-specific needs can fall second to driving profit within healthcare organizations. Generally, the healthcare industry is being encouraged to move away from FFS models and towards value-based care models as a means to reduce healthcare spending and improve efficiency, while simultaneously improving the quality of care given to individual patients.