Which statement describes Medicare Advantage capitation payments?

Which statement describes Medicare Advantage capitation payments?

• A. Subjected to benchmarking process
• B. CMS pays flat fee based on benchmark per member per month
• C. Both A and B
• D. None

Answer: (C)

Medicare Advantage payments are capitation, meaning a fixed amount per enrolled beneficiary paid every month to the plan. This amount is anchored to a county-specific benchmark established by CMS, which is the baseline used to determine payments. Plans submit actuarial bids representing their expected costs, and CMS uses the benchmark plus these bid submissions (and risk/quality adjustments) to finalize the per-member-per-month payment. In other words, capitation payments are monthly flat-rate payments tied to the geographic benchmark, with the bid and other adjustments shaping the final amount. That combination describes both the benchmarking process and the per-member-per-month nature, so both aspects are correct.

Medicare Advantage payments are capitation, meaning a fixed amount per enrolled beneficiary paid every month to the plan. This amount is anchored to a county-specific benchmark established by CMS, which is the baseline used to determine payments. Plans submit actuarial bids representing their expected costs, and CMS uses the benchmark plus these bid submissions (and risk/quality adjustments) to finalize the per-member-per-month payment. In other words, capitation payments are monthly flat-rate payments tied to the geographic benchmark, with the bid and other adjustments shaping the final amount. That combination describes both the benchmarking process and the per-member-per-month nature, so both aspects are correct.