What responsibility do capitation formulas assign to physicians?

Capitation formulas assign physicians the responsibility of meeting the goals of managed care contracts. In a capitation payment model, physicians receive a fixed amount for each patient assigned to them, regardless of the number of services provided. This structure incentivizes physicians to focus on preventive care and efficient management of patient health to avoid unnecessary services and costs.

By aligning their practices with the goals of managed care, physicians are encouraged to maintain a high standard of care while also managing resources effectively, ensuring that patients receive the necessary treatments without overutilizing services. Meeting the goals of these contracts typically involves achieving certain health outcomes, managing chronic conditions, and emphasizing preventive care. As a result, the success of capitation formulas hinges on physicians’ ability to navigate these objectives while maintaining patient satisfaction and health outcomes.