A nurse is working with a case manager for a client who participates in a health maintenance organization. The nurse should identify that a health maintenance organization provides which of the following payment structures?

Answer is b. The provider is paid a fixed sum for the client on a monthly or yearly basis.

A health maintenance organization (HMO) is a type of health insurance that contracts with a network of providers and facilities to offer care at a discounted rate. The HMO pays the provider a fixed sum for each client, regardless of the services they use. This is called capitation³. The HMO also requires the client to have a primary care provider who coordinates their care and makes referrals to specialists².

a. This statement is wrong because it describes a co-payment, which is a fixed amount that the client pays for each service. Co-payments are usually low in HMOs, but they are not the main payment structure².
c. This statement is wrong because it describes a fee-for-service health care insurance program, which is the opposite of an HMO. In a fee-for-service program, the client pays the insurer for each service they use, and the insurer reimburses the provider. This gives the client more freedom to choose their provider, but it also increases the cost of health care¹.
d. This statement is wrong because it describes a co-insurance, which is a percentage of the total cost that the client pays for each service. Co-insurance is more common in preferred provider organizations (PPOs), which are another type of health insurance that offer more flexibility than HMOs, but also higher premiums