However, the more the overall premium dollar and benefit package is split among separate provider organizations within the same community serving the same people, the more likely it is that some providers will try to shift risks to other providers. For example, if specialized mental health services are carved out from a larger system of medical services, physicians who are capitated for primary care may increase their rate of referrals to the mental health provider. Membership and enrollment will have important effects on the level of risk in any service system. The overall size of the membership is the number of persons in the group whose care is to be managed, as well as the number of those who are likely to become enrolled as members and utilize care. The greater the size of the membership, the more predictable the statistical averages on which capitation and case rates are based and, therefore, the more reliable the estimate of risk.
Enrollment can be voluntary or mandatory .
Voluntary enrollment carries with it the risk of creaming, selecting the most desirable members, and adverse selection , a term that refers to any process or circumstance that would result in more persons needing many services enrolling in your system. Giving enrollees a choice among provider systems also creates potential for adverse selection and creaming. The enrollment process is exclusive when limited to a single provider system or competitive when there is a choice of two or more provider systems. An initial balance among competing systems may be enforced by assigning members to a given provider network, either randomly or based on an algorithm to ensure initially a balanced enrollment of the various levels of severity among all competing provider networks. The actuarial approach and the use of prospective risk simulation are two basic methods for preparing estimates of risk.