The primary source for revenue for HN1 is through Capitated Network Management Services. Under these payor agreements, HN1 is paid a capitation fee for the professional or both the professional and technical components of one or more medical specialty(ies). As part of these agreements, HN1 may use its existing network of contracted providers, the health plan's existing provider network, or some combination of its provider network and the health plan's provider network. HN1 also would usually assume responsibility for some or all of these operational functions:
Under these arrangements, HN1 is paid an administrative or an access fee for developing a network of providers or leasing its existing provider network to a health plan. Under these arrangements, HN1 could also be paid a bonus for any Part B and/or Part A Savings achieved or incur a financial penalty should Part B and/or Part A expenses increase or remain unchanged while under the management of HN1.
Under a network services arrangement, Payers often delegate some or all of the following administrative functions to HN1:
HN1 would typically provide these management services to health plans that have recently entered a new market service area and do not have an existing provider network and/or do not have the internal resources to expand its existing provider network.