Understanding and coping with the new HCFA physician incentives stop-loss insurance rules

The imposition of physician incentive regulations by the Health Care Financing Administration for Medicare risk and Medicaid managed care contracts has created disclosure and stop-loss reinsurance issues for both physician groups and their contracting health maintenance organizations. This article summarizes the key points of the stop-loss requirements of the new rules, describes the current types of stop-loss reinsurance purchased prior to the effective date of the regulations, and the practical problems of conforming current physician group contracting practices to these rules. The article also provides several suggested steps that physician groups should take to manage the changes required.