"Four alternative payment methods were tested as alternatives to the Adjusted Average Per Capita Cost (AAPCC) : reinsurance, select and ultimate rates, partial capitation and blended rates, and experience rating. using data from the Continuous Medicare History Sample (CMHS) and from one HMO, the study concluded that there are a range of methods than can improve payment to HMOs. Specifically, partial capitation and blended rates were effective in limiting the financial risk incurred by plans. Reinsurance models protected against catastrophic costs incurred by plans while the rate adjustments used in select and ultimate rates can mitigate against severe selection effects. Finally, experience rating did not accurately predict future costs for Medicare beneficiaries. However, each method used in this study represented improvements over the current AAPCC."-- NTIS report documentation page.