Capitation among Medicare beneficiaries.

CONTEXT The Medicare program has promoted capitation as a way to contain costs. About 15% of Medicare beneficiaries nationwide are currently under capitation, but tremendous regional variation exists. PRACTICE PATTERN EXAMINED The proportion of Medicare beneficiaries who have enrolled in risk-contract plans in individual states and in the 25 largest metropolitan areas in the United States. DATA SOURCE Health Care Financing Administration data files. RESULTS Medicare beneficiaries are most likely to be under capitation in Arizona (38%) and California (37%). Eight other states have capitation rates greater than 20%: Colorado, Florida, Rhode Island, Oregon, Washington, Pennsylvania, Massachusetts, and Nevada. Thirty states, largely in the Great Plains area and the southern United States, have capitation rates less than 10%. Four major metropolitan areas have market penetration rates greater than 40%: San Bernardino, California; San Diego, California; Phoenix, Arizona; and Miami, Florida. Little penetration exists outside of metropolitan areas. CONCLUSION Capitation in Medicare is a regional and predominantly an urban phenomenon.