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Assuming and managing risk: Part II
Hospital Cost Management and Accounting
|November 4, 1995
Insights
Hospitals face increasing risk in managed care. This article assesses financial and physician-related risks associated with capitation contracting for healthcare organizations.
Area of Science:
- Healthcare Management
- Health Economics
- Risk Management
Background:
- Hospitals are increasingly involved in managed care.
- This necessitates addressing the issue of hospitals assuming financial risk.
Purpose of the Study:
- To continue the discussion on hospitals assuming risk in managed care.
- To focus on capitation contracting and physician-related issues.
- To assess the risks hospitals will acquire in a managed care environment.
Main Methods:
- Review of current managed care trends.
- Analysis of capitation contracting models.
- Examination of physician-hospital relationships in risk-sharing arrangements.
Main Results:
- Capitation contracting introduces significant financial risk for hospitals.
- Physician-related issues, such as alignment and compensation, are critical to managing risk.
- Hospitals must proactively assess and manage acquired risks.
Conclusions:
- Hospitals must strategically evaluate and prepare for the risks inherent in managed care.
- Effective management of capitation and physician dynamics is crucial for financial stability.
- Proactive risk assessment is essential for successful navigation of the managed care landscape.
Abstract:
Last month HCMA began to address the issue of hospitals assuming risk as they become more and more involved in managed care situations. This article continues that discussion. The focus is on capitation contracting, physician-related issues, and a final assessment of the risk that hospitals should and will acquire as they move forward in a heavily managed care environment.