Carve-out Options

Carving out is a strategy that separates a specialty service (the carve out) from other services provided by an organization. A specialty care provider that usually assumes some financial risk to provide the service then manages the carved-out service.

Carve-out arrangements vary significantly in form, benefit design, provider network characteristics, fee arrangements, and management tech­niques. The mental health care industry has used carve outs for some time to provide and manage care. Carve outs potentially could be beneficial for transport teams by allowing them to provide the service for an organization that wants to provide the service but is uncomfortable with the potential financial or other risks. The advantage of carve outs to the parent organi­zation is the ability to share or totally mitigate financial risk for services deemed important by its customers and stakeholders. Risk sharing in this situation can take a number of forms, including a vendor contract in which the transport team that provides the service functions as a clearly separate and independent agency or an arrangement in which an agency provides the service under the name of the parent organization. Risk is minimized in either case for the parent organization, because the agency providing the service agrees to manage the service and assumes responsibility for collect­ingpayments and for the cost of the program.