What does it mean to be “at risk”? Print
Written by M. Alexandra Johnson, FACHE   
Friday, 13 April 2012 16:48

The concept of being "at risk" has to do with the level of financial risk the entity has in funding the care its patients receive. As profit-oriented enterprises, insurance companies generally assess the insured's risk and base the premium on the anticipated cost of care with the ultimate goal of minimizing that risk. MedicareAdvantage plans are insurance companies, in a sense, that are paid a capitation by the Centers for Medicare and Medicaid Services (CMS) for each enrolled member. In exchange for that capitation payment, the Plan is financially liable for all the care given to the patient (e.g., all medications, surgical procedures, office visits, etc.) by any provider.

Depending on the plan's business model, it may contract with physicians operating as Independent Practice Associations (IPAs) or with groups that own or manage multiple physician offices under a Management Services Organization (MSO). In many cases, the plan's risk is passed onto the IPA or MSO. Click here to read more.

About the author:  M. Alexandra Johnson, FACHE (click to view author's bio)

Last Updated on Friday, 13 April 2012 16:54