A view from under the microscope. Medicare prospective risk contracting

The authors provide an overview of the Marshfield Clinic's four-year demonstration contract with HCFA that resulted in the enrollment under a prospective risk contract of over 8,900 Medicare beneficiaries. Public policy implications are discussed along with recommendations for group practices contemplating Medicare prospective contracts. Recommendations include the attention which must be paid to potential adverse selection, hospital utilization control, and potential technical and methodological problems with the prospective reimbursement system. Data from the demonstration will be of significant value to other groups interested in prospective contracting with HCFA. The concept of prepaid Medicare, if appropriately refined, can serve the best interests of Medicare beneficiaries, providers, and