What describes retrospective payment?

Retrospective payment is characterized by payments being based on the actual costs incurred after services have been rendered. This model allows healthcare providers to submit claims for reimbursement after the procedures have been completed, which contrasts with other payment methods that may involve upfront payments or fixed rates.

In a retrospective payment system, healthcare facilities and providers often document the services and the associated costs, submitting these records for reimbursement from insurers or government programs. This approach can promote thorough billing accuracy, as providers are compensated based on the actual economic expenditures incurred during patient care. Unlike prospective payment methodologies, where a predetermined amount is set before services are provided, retrospective payment aligns reimbursement closely with the reality of service costs.