If funders wish to ensure that patients with greater needs for health carecarry a larger capitation, to reduce financial incentives for providersto cream skim or dump patients, or to give providers incentivesto improve outcomes, then it is necessary to know how patients’expected cost varies with their characteristics (Schokkaert et al.,1998; Sibley and Glazier, 2012; Ash and Ellis, 2012). Despite theprima facie importance of morbidity as a determinant of health-care costs, most primary care capitation systems currently relatepayments only to patient age and gender.