Overview of employer capitation activities

This article addresses a new initiative of the Health Care Financing Administration (HCFA) to contract on a group basis with: employer self-insurance plans, unions, group health insurance companies, and Taft-Hartley Health and Welfare Funds for groups of Medicare beneficiaries. Under this new concept, Medicare beneficiaries may elect in the future to obtain Medicare coverage through their group insurance plan rather than through traditional Medicare, with HCFA paying the premiums. This Medicare demonstration will bridge the gap between employer plans, which coordinate with traditional Medicare coverage, and employer-sponsored health benefit plans. This will make available to Medicare-eligible retirees similar, if not the same, managed-care alternatives as are currently available to active employees.