Hospitals that enter into capitation fee agreements, such as with HMOs, recognize patient service revenues in the same manner (giving consideration to contractual and implied concessions) as for all other patient service revenues.

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Hospitals that enter into capitation agreements with various HMOs receive agreed-upon premiums per member, per month, regardless of the actual services they perform for each patient. The revenue is earned by agreeing to provide care.

Hospitals That Enter into Capitation Fee Agreements, Such as with HMOs