Fee-for-service reimbursement

Traditionally, physicians were reimbursed using a fee-for-service (FFS) payment system, in which physicians were compensated for every test or procedure that they performed, regardless of whether their patients felt better after the tests or procedures. This reimbursement method leads to conflicting incentives for physicians, who are tasked with caring for their patient efficiently while, at the same time, earning a living. Many people attribute today's exorbitant US healthcare spending to FFS. Additionally, FFS reimbursement pays each physician individually, with minimal coordination between physicians. What happens if a patient sees two doctors for the same condition? Under FFS reimbursement, the physicians could order duplicate tests and be reimbursed separately.