The Capitation Sourcebook: A Practical Guide to Managing At-Risk Arrangements

Rating:
Summary: Very comprehensive guide to health care capitation payments
Review: THE CAPITATION SOURCEBOOK:

A Practical Guide To Managing At-Risk Arrangements

Capitation presents a unique dilemma to health care information executives grappling with increased demands for more data and information processing capability while revenue continues to decline at their institutions. This is the reality of managed care today.

A comprehensive new book, THE CAPITATION SOURCEBOOK: A Practical Guide To Managing At-Risk Arrangements, published by Boland Healthcare, describes the challenge of capitated reimbursement to lower costs and improve care at the same time. In six hundred plus pages and thirty chapters written by operational experts in the field, it explains how to manage risk more efficiently and how to design information systems to better meet the needs of patients, practitioners, and managed care organizations. This is a daunting task particularly for health care systems and providers making the transition from fee-for-service to risk sharing arrangements. The Capitation Sourcebook includes over a hundred tables and many figures that illustrate the types of information required by organizations to be successful in managing different risk arrangements. However, the book goes far beyond a traditional facts and figures approach. It presents a conceptual framework for understanding why capitation is now the driving force in managed health care and what this means in terms of operational and clinical requirements for day-to-day managers. Information is key and the primary mechanism for aligning financial incentives among providers and redesigning patient care systems in order to reduce costs.

The book is rich in content. It challenges CIOs to rethink how to manage data and information to create the necessary knowledge base for institutions involved in risk contracts. It points to dozens of case studies where key stakeholders -- physicians, hospitals, and delivery systems -- have been successful in building collaborative financial models that distribute risk and income equitably. The authors demonstrate that success depends on a philosophical commitment to better care, a business strategy that drives operational efficiency, and an information system that supports accountability and timely feedback.

Part one of the book introduces the main themes of performance accountability and business strategy. Part two details how to align performance and payment criteria. Part three explains a number of practical techniques for managing the transition to prepaid incentives and physician compensation models for phasing in capitation. It also includes the information components required to manage Medicaid capitation. Part four focuses on the information requirements and financial controls for managing provider networks. Part five deals with clinical resource consumption and utilization management issues. Part six describes negotiation principles and actuarial cost models to evaluate contracts. Part seven highlights specialty and ancillary service contracting guidelines. The book concludes with a discussion of ethical issues in risk-based contracting arrangements. A very useful and complete glossary of managed care terms is also included.

This book should be required reading for all health care executives and CIOs. It painstakingly identifies data requirements and report formats for monitoring provider and health plan performance. It also challenges information executives to reassess the value of what they do in terms of lowering the cost of care and increasing the health status and functioning of patients. This is not the traditional yardstick for measuring performance but it is one that managed care buyers are beginning to use in selecting their health care suppliers and partners in the future.

CIOs should pay careful attention to the strategic advice given in this book as well as practical methods of how to operationally manage the information requirements of capitation. The book's editor, health care industry expert Peter Boland, has once again correctly anticipated market trends and documents what providers and CIOs must do to be successful in this new environment.

Book Review Author

Walter Wieners, Consultant, Sausalito, CA provides international managed care planning and strategic business advisory services.