New payment experiments explore a key issue in the decades-long struggle over US health care spending, which is how to distribute liability for expenses across all market participants, from insurers to providers. The rise and abandonment in the 1990s of capitation payments—lump-sum, per person payments to health care providers to provide all care for a specified individual or group—offers a stark example of how difficult it is for providers to assume meaningful financial responsibility for patient care.
This article chronicles the expansion and decline of the capitation model in the 1990s. We offer lessons learned and assess the extent to which these lessons have been applied in the development of contemporary forms of provider cost sharing, particularly accountable care organizations, which in effect constitute a search for the “sweet spot,” or appropriate place on a spectrum, between providers and payers with respect to the degree of risk they absorb.
Read the full article here.
Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.
