“Capitation Returns, All Bundled Up” By Francesco Federico M.D.
In this Payers & Providers article, “Capitation Returns, All Bundled Up”, Francesco Federico, M.D. discusses the return of capitation and how as a new payment system it hints at old ones.
“Love it or leave it, capitation is creeping back into healthcare in a kinder, gentler way.
We first saw capitation as a proposed solution to the nation’s healthcare problems during the managed care era of 1985-2005. The concept however was poorly accepted and performance was suboptimal.
Today, accountable care promoted by the Accountable Care Act again promises much – provider choice, a better patient experience, transparency, accountability, enhanced quality, cost containment, value promotion, and sophisticated analytic tools to make evidenced-based decisions. In an attempt to avoid the negativism of capitation, the architects have introduced the term “bundling.” But healthcare veterans know the truth and see a remarkable similarity between “bundling” and capitation – both are restrictive payment options found on the fee-for-service end of the payment spectrum.
During the last era, a variety of internal organizational and external market factors drove bad capitation behavior. While “bundling” is a differently calculated episodic condition restrictive payment vehicle, it is not intrinsically more pure or automatically destined for success.”