Provider excess loss insurance: a safety net for risky business

Capitation agreements are challenging healthcare providers to keep the cost of delivering care at or below their agreed-upon capitated payment. To protect themselves when this cannot be accomplished, providers are purchasing provider excess loss insurance, which reimburses providers if their patient costs exceed a deductible or per-member-per-month dollar threshold. It is important that managers understand differences among the three general types of providers excess loss insurance: per-person, aggregate, and carve-out.