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Article: Managed care puts captives on a potentially perilous path. (health care captive insurance firms face capitated risk)(Captive Insurance Review)
- Article from:
- National Underwriter Property & Casualty-Risk & Benefits Management
- Article date:
- March 17, 1997
- Author:
CopyrightCOPYRIGHT 1997 The National Underwriter Company. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Prodded by the rapid rise of managed care, health care risk managers have begun to find a new and potentially perilous use for their captives: capitated risk.
Already, "a couple of captives have lost their proverbial shirts" by not collecting enough premiums on "provider-excess" stop-loss insurance they had written, Corbette S. Doyle, chief executive officer of the Aon Alliance in Brentwood, Tenn., told the National Underwriter.
The insurance covers the risk that the capitated, or per-head, fixed fees negotiated by health care providers may prove to be too low to cover the cost of the care actually provided, according to Ms. Doyle, who would not ...