Which payment model involves a single bundled payment covering all services for a patient's episode?

• A. Shared savings
• B. Pay-for-performance
• C. Bundled payments
• D. Fee-for-service

Answer: (C)

Bundled payments involve one payment that covers all services during an episode of care, such as the entire hospital stay plus related physician services and post-acute care. This setup creates a single price for the whole episode, encouraging coordination among providers and efficient use of resources because any cost overruns or savings affect the same payment.

This is the best choice because it directly describes a single bundled payment for the entire episode, which is the defining feature of bundled payments. In contrast, shared savings models reward providers when they reduce costs relative to a benchmark and achieve quality targets, but there isn’t necessarily one fixed payment for the entire episode. Pay-for-performance adjusts payments based on meeting quality metrics but again doesn’t bundle all services into a single episode payment. Fee-for-service pays separately for each service rendered, which tends to incentivize volume rather than coordinated cost control.