Depending on the competitive and economic climate of the healthcare market, provider organizations may be limited in revenue generation strategies. Although taking on additional risk has been largely shunned by hospitals, it can be an effective leveraging technique to secure more favorable reimbursement. However, this strategy may only be appropriate under a particular set of circumstances and for specific types of healthcare providers. For example, highly integrated delivery systems with established care management programs would be well-positioned for this endeavor. The following are some prerequisites for a healthcare organization to be a potential candidate for increased risk sharing:

o Current level of fee-for-service payment rates are low, and taking on more risk may result in higher revenue stream
o Organization is a high performing hospital from the quality and efficiency perspective, but is currently reimbursed at average market payment rates
o Organizational structure and culture reflects physician buy-in and aligned incentives across the care givers
o Healthcare system or hospital currently benefits from good data collection and provider profiling and has access/utilizes various benchmarks
o Senior leadership effectively communicates vision and mission and organization has a collaborative culture
o Wellness is strongly emphasized as part of the current culture and physician practices
o Healthcare system contains a primary care network or is the only hospital (capitation initiatives are not congruent or as effective with open networks)

Increased risk sharing is often associated with capitation, but this is not always the case. The presentation will outline various scenarios in which organizations can take on additional risk without committing to traditional per member per month payment arrangements. Some of the scenarios discussed include:
o Utilization of pilot models with increased risk sharing arrangements
o Capitation with risk corridors (i.e. symmetrical limits and stop loss arrangements)
o Pay for Performance initiatives
o Global caps
o Episode treatment group payment schemas
o Withholds arrangements
o Quality-based bonus programs