The probability of financial loss, based on the probability of having to provide services to a patient or patient population at a cost that exceeds the payments received. Under capitation payment systems, providers share the risk that is borne by insurers.

risk adjustment

Increases or reductions in payment made to a health plan on behalf of a group of enrollees to compensate for health care expenditures that are expected to be higher or lower than average.

risk corridor

The temporary risk corridor program was a provision of the Affordable Care Act from 2014 through 2016 that was intended to discourage insurers from setting premiums high in response to uncertainty about who will enroll and what they will cost. The program worked by...

Risk Evaluation and Mitigation Strategy

A strategy to manage a known or potential serious risk associated with a drug or biological product, which is sometimes required by the Food & Drug Administration to ensure that benefits of a drug or biological product outweigh its risks.

risk selection

Enrollment choices made by health plans – or by enrollees – on the basis of perceived risk relative to the premium to be paid.