The Link Between Disease Management and Capitation Contracting: Financing Population Health

Disease management systems are quickly becoming one of the nation's most viable answers to managed care's intense cost pressures and unwavering public scrutiny. Many believe that managed care provider reimbursement systems place the providers of healthcare at odds with the health of their enrolled populations. Disease management systems and the parallel changes in provider reimbursement may swiftly change this scenario. Beyond the techniques employed in managed care to reduce total medical expenses, there is a higher purpose central to population health models. That higher purpose is the provision of optimal health care, that which has been clinically proven to afford the patient the best and most appropriate care along the full continuum of health services, provided in the most cost-effective manner. Payment systems designed to reimburse providers according to the provision of "optimal care" may truly transform the world of medical-care financing and move us toward the ultimate goal of population health management. The following manuscript provides a framework for alignment of principles and possible configurations of innovative healthcare financing mechanisms.