VERTICAL INTEGRATION MODELS TO PREPARE HEALTH SYSTEMS FOR CAPITATION

Health systems will profit most under capitation if their vertical int egration strategy provides operational stability, a strong primary car e physician base, efficient delivery of medical services, and geograph ic access to physicians. Staff- and equity-based systems best meet the se characteristics for success becuase they have one governance struct ure and a defined mission statement. Moreover, physicians bonds are st rong because these systems maximize physicians' income potential and c ontrol the revenue stream.