Your companys chief financial officer (CFO) begins the preliminary work of developing the organizations financial plan for the upcoming year.
Recently there have been media reports that your state will be cutting health care costs by reducing benefits paying health care providers or organizations less and tightening eligibility. Specifically the states Medicaid budget will be reduced by 6 percent and fees to health providers will be reduced by 3 percent.
Revenue from Medicaid constitutes 30 percent of Kronas annual revenue. The annual revenue for Krona last year was $20000000 and was expected to increase 10 percent the following year. The chief executive officer (CEO) has asked that you provide a brief summary of capitation to share with the board.
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