Answer: its financial risks for providers can be substantial.
Step-by-step explanation:
Capitation is a type of payment plan that is used in the healthcare industry. It works by paying the healthcare provider a certain amount of money for a person in a specific period of time even if the person does not take advantage of this by coming to the provider.
This can pose substantial financial risk to the provider because a situation might arise where the person who was paid for comes in so many times for care that the provider spends more taking care of the person than if the person had paid for every visit.