role-manager plugin – capabilities

I just installed the role-manager plugin and I don’t understand how the thing about adding capabilities works. It asks you to give your capability a name, but I don’t see where I can define what that capability allows the user to do.

The exact thing that I’m trying to do is create three levels of read posts access. First for all people who have access to the site, second for people who are logged in as a Subscriber (and therefore can read private posts), and third for posts that only admins can read. It was easy to create a capability called “read admin posts” and assign it to the Admin role, but I didn’t see how to make that capability do anything.

I know I can use the password option, but that still displays the title of the post publicly. It’s better for the admin posts to be completely hidden the way the private posts are.

TIA for any info