Definition extracted with permission from American Academy of Family Physicians: Family Physicians and Managed Care
A description of the limitations of financial liability remaining with a major entity to the HMO program. For example, the HMO may accept all risk to guarantee provision of services to its enrolled population. This risk may be limited by arrangements with reinsurers. Also, the fee-for-service/prepaid medical group may take full risk or limit its risk by contractual arrangements with the HMO corporation.