One of the driving forces to control health care costs in the last decade while increasing patient access to health care clinicians has been the creation of a financial system called capitation. This is the cornerstone of most managed care plans particularly health maintenance organizations (HMOs) or preferred provider organizations (PPOs).
Capitation is the prepayment for health care services, such as office visits, on a monthly basis per patient. This means that for primary care the clinician receives the same amount of money each month irrespective of how many patients they examine or what therapy they provide. This sharply contrasts with the traditional fee‐for‐service (FFS) plan in which a physician sets a fee for a particular service such as an annual history and physical, and the patient or their insurance company is responsible for reimbursement.
The way capitation works is that an insurance company will contract with physicians to provide care for a group of patients. Patients...
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Suggested Readings
Cutler DM (2004) Your money or your life. Oxford University Press, New York
Dacso ST and Dacso CC (2000) Managed care answer book, 4th ed. Aspen Publishers, New York
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Ober, S.K. (2008). Capitation. In: Loue, S.J., Sajatovic, M. (eds) Encyclopedia of Aging and Public Health. Springer, Boston, MA. https://doi.org/10.1007/978-0-387-33754-8_76
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DOI: https://doi.org/10.1007/978-0-387-33754-8_76
Publisher Name: Springer, Boston, MA
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