Capitation (healthcare)

Capitation in healthcare is like your parents giving your allowance to your teacher, and the teacher using that money to take care of you for the whole year.

So instead of the doctor charging you and your family for each visit or treatment, the doctor gets paid a certain amount per patient from the insurance company or government. This amount is based on how many patients they have and the predicted cost of their care.

This means, the doctor gets paid the same amount for taking care of you whether you visit them once or ten times during the year. It’s like the teacher getting the same money from your parents regardless of how well you behave in class or if you get sick.

Capitation is meant to encourage doctors to focus on preventive care - keeping you healthy, rather than just treating you when you get sick or injured. It also helps to control healthcare costs by creating a predictable stream of income for healthcare providers.