Capitation represents a fixed monthly amount that a Health Maintenance Organization (HMO) pays to a group of healthcare service providers who have contracted with the HMO under the health insurance plan. This is a fixed amount that depends upon the number of HMO enrollees who have chosen this group of healthcare service providers for providing ‘primary care’ services under the HMO plan. The amount does not vary with the amount of products or services utilized by HMO enrollees offered by this group of HMO providers. It must be noted that not all HMO utilize capitation payments.