What is a method of health care reimbursement involving a set payment per day?

Per diem is a method of health care reimbursement where a predetermined amount is paid for each day a patient is hospitalized or receiving care, regardless of the specific services provided during that day. This approach streamlines billing for both providers and insurers, as it simplifies the process by standardizing payment based on time rather than individual treatments or services rendered.

Per diem reimbursement is typically used in settings like hospitals or skilled nursing facilities, where the focus is on the length of stay rather than the details of each specific service. This method encourages efficiency, as facilities are incentivized to manage costs while still providing necessary care to patients.

In contrast, capitation involves a set payment per patient for a specific time period, covering all care that patient may need, while fee-for-service reimburses providers for each specific service rendered. Bundled payments combine payments for multiple services into a single payment, often for a specific episode of care. Each of these other methods has its own implications for care management and financial incentives, but per diem specifically relates to reimbursement based on daily care.