Fixing responsibility for risk management

The responsibility for carrying financial risk for medical coverage has migrated from individuals to insurers to employers to providers, without finding a satisfactory home. Each shift further complicates the health care infrastructure, as other responsibilities in the management of benefits and provision of care gravitate to the stakeholder who accepts risk. The social imperative to broaden coverage is forcing a change in the mechanisms of risk management--from avoiding high-risk patients, to managing those patients to better outcomes. In this paper we seek to identify objectively the most appropriate party to carry the financial risk of medical coverage, consider what characteristics are necessary to make that a practical and enduring solution, and examine the secondary effects of the structure required to support that solution.