Solved: Is capitation the wave of the future? Why or why not?

Is capitation the wave of the future? Why or why not?

Expert Answer

As far as the new trends in health care goes, Capitation is definitely one of the major trends that is catching up in todays world. And in my opion it is here to stay for long.

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Using this approach requires thorough understading on a number of levels. However, capitation model could be part of the health care solution, because payments are more or less the same, irrespective of how many services or what type of services each patient actually receives. Capitation offers a number of other positives as well:

(1) Provider organizations can gain sustainability, control over their future, and enhanced business oppotunities

(2) Organizations find themselves centering their efforts around proactive health management rather than quick short-term benefits.

(3) It provides incentives for organizations providing the service and fosters coordination, quality, and financial responsibility.

To reap these rewards, however, organizations must understan work with a number of critical success factors. Among the critical ones are: a provider network with adequate reach, sufficient and appropriate funding, a large number of membership subscription , state of the art care coordination systems, providers vested in the success of the entity or model, strong administrative support and physical infrastructure, a high quality, and able leadership.

Good business discipline is also required, strategic planning, mentorship and succession planning. Robust business modeling and forecasting based on actuarial projections. Support infrastructure like IT infrastructure; knowledgeable, experienced administrative staff; and effective contractual relationships and communication mechanisms with outside providers.

A decent measure of risk is associated with capitation too. Health care costs have been out of control for a long time, and as a result many organizations are reluctant to work with finite financial resources to achieve stated goals. That said, the time could be right for capitation

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