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Definition of Capitation

Capitation: In US health services, a fixed 'per capita' amount that is paid to a hospital, clinic, or physician for each person served. If that person uses few services, the excess amount paid is potential profit for the payee. If the person uses many services, the payee may lose money.

Source: MedTerms™ Medical Dictionary
http://www.medicinenet.com/script/main/art.asp?articlekey=2623
Last Editorial Review: 3/19/2012

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