Is the Risk Really Shared? A Retrospective Analysis of Healthcare Costs of Patients With Type 2 Diabetes Mellitus on a Capitation Model

Objectives: Private managed healthcare organizations in South Africa (SA) use a capitation model of care for patients within their healthcare delivery systems for the optimal management of type 2 diabetes mellitus (T2DM) to reduce healthcare costs. Few studies have categorized healthcare costs at a patient level to determine the actual healthcare costs incurred by private insurers for T2DM in SA. This study estimated the direct medical costs of patients with T2DM registered with a private health insurer over a 5-year period between 2 funding models: a capitated risk-sharing model (CM) versus a traditional fee-forservice (FFS) model.

Conclusions: The patients with T2DM on CM accrue significantly higher annual healthcare costs than patients on FFS. The greatest portion of the overall T2DM healthcare costs was associated with high-cost hospitalization of T2DM complications