What Is Fee-for-Service (FFS)?
Fee-for-Service (FFS) is a traditional healthcare payment model where providers are paid separately for each service they perform, such as doctor visits, tests, or procedures. This model gives patients freedom to choose their providers but can lead to higher healthcare spending and fragmented care.
How does FFS compare to other models?
While FFS was once the dominant system, many insurers and healthcare providers have shifted to other models to control costs and improve patient outcomes.
- Fee-for-Service (FFS): Doctors are paid for each service individually, regardless of patient outcomes. Most commonly used in Original Medicare (Parts A & B) and private insurance plans that allow out-of-network care.
- Value-Based Care: Providers are paid based on patient health outcomes rather than the number of services provided. Increasingly common in Medicare Advantage plans and some employer-based insurance.
- Managed Care (e.g., HMOs and PPOs): Insurers establish provider networks and care guidelines to control costs and improve coordination. Common in Medicaid managed care, Medicare Advantage, and many employer-sponsored plans.
Pros and cons of FFS
- More provider choice: Patients can see any doctor, often without referrals.
- More control over care decisions: Patients can request additional tests or treatments.
- Higher out-of-pocket costs: Each service is billed separately, and insurance may not cover everything.
- May lead to unnecessary treatments: Since providers are paid per service, there’s potential for overuse of medical tests or procedures.
How Solace can help
A Solace advocate can help you understand FFS billing, compare alternative coverage options, and determine whether a managed or value-based care plan might better suit your needs. If you're facing unexpected charges, an advocate can also assist in negotiating medical bills and exploring financial assistance programs.
What to do next
Need help managing fee-for-service costs or understanding your options? Find a Solace advocate today.