Common use of CAPITATION Clause in Contracts

CAPITATION. Specific geographic estimates of the maxima for the eligibility classification, age and gender categories are developed based on actual paid claims for a date of service (DOS) period. In order to account for all claims related to the DOS period, historical data are used and inflated forward to the midpoint of the period for which the fee-for-service equivalents are being calculated. The total dollars expended for the DOS period are then aggregated by eligibility classification, age and gender category of the fee-for-service population eligible during the DOS period. (The age cohorts utilized by the Department are listed in Attachment I.) The total dollar amount expended for the DOS period is then divided by the total number of eligible recipient months for the DOS period, resulting in a per member per month fee-for-service equivalent amount, based on the fee levels paid by the Department to Providers, and anticipated levels of service utilization.