Froogle | Glossary | 'Capitation Rate'

under a system of reimbursement for MCOs, the capitation rate is the monthly fee. It is paid for either:

(a) each member assigned; or

(b) each event (eg, maternity delivery)

Moreover, the payment is made regardless of the actual number/cost of services provided.

Capitation rates can vary by member – based on

(i) demographics;

(ii) location;

(iii) covered services; or

(iv) other characteristics.

Also, capitation rates can be structured so that an MCO is either:

(a) fully at-risk; or

(b) sharing the risk with other parties.

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