Fee-for-Service (FFS) Definition

Fee-for-Service (FFS) is a payment model in healthcare where healthcare providers are reimbursed based on the quantity of services they deliver to patients. Under this model, each service, procedure, or consultation is billed separately, and the healthcare provider receives payment for each itemized service provided, regardless of the outcome or quality of care.

FFS contrasts with alternative payment models, such as capitation or bundled payments, which may focus on paying healthcare providers a fixed amount per patient or per episode of care. FFS can incentivize volume over value, potentially leading to increased healthcare costs and fragmented care delivery. However, it remains widely used in many healthcare settings, particularly in fee schedules for specific services rendered by physicians, specialists, and hospitals.