The power of physicians: autonomy and balance in a changing system.
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This paper examines the effects of risk sharing with mental health providers in a managed care context. The results show that providers that received a fixed payment per case reduced the number of outpatient visits by 20-25%, compared with providers who continued to be paid for each visit. This effect was stronger for integrated group practices and providers with more intensive utilization review protocols. In addition, evidence was found that in a setting where providers serve multiple payers, the share of their total revenue derived from risk-sharing contracts is an important determinant of the magnitude of the supply response.
This paper considers the role of statistical discrimination as a potential explanation for racial and ethnic disparities in health care. The underlying problem is that a physician may have a harder time understanding a symptom report from minority patients. If so, even if there are no objective differences between Whites and minorities, and even if the physician has no discriminatory motives, minority patients will benefit less from treatment, and may rationally demand less care. After comparing these and other predictions to the published literature, we conclude that statistical discrimination is a potential source of racial/ethnic disparities, and worthy of research.
Waiting times for hospital care are a significant issue in the UK National Health Service (NHS). The reforms of the health service in 1990 gave a subset of family doctors (GP fundholders) both the ability to choose the hospital where their patients were treated and the means to pay for some services. One of the key factors influencing family doctors' choice of hospital was patient waiting time. However, without cash inducements, hospitals would get no direct reward from giving shorter waiting times to a subset of patients. Using a unique dataset, we investigate whether GP fundholders were able to secure shorter waiting times for their patients, whether they were able to do so in cases where they had no financial rewards to offer hospitals, and whether the impact of fundholding spilled over into shorter waiting times for all patients.
Most physicians today treat a variety of patients within their practices where a variety of insurance arrangements co-exist. In this paper, we propose several theoretical explanations for physician treatment patterns when the patient population is heterogeneous at the practice level. Data from the 1993-1996 National Ambulatory Medical Care Survey (NAMCS) are used to test how practice level managed care penetration affects treatment intensity. Practice composition has strong effects on treatment. Visit duration appears to be constant across patients within a practice, while medications prescribed appear to be converging as managed care penetration increases.
Doctors and patients generally share a common interest in maximizing the quality of care. Purchasers of health care on the other hand, desire cost-effective levels of quality. We consider the purchaser's problem of implementing supply-side cost sharing when patients and doctors are asymmetrically informed and can collude to advance their own joint interests in maximal quality. Such collusion can be interpreted as the sort of informal side-payments that are observed in transitional and developing economies. It may also be interpreted as a "formal" (but unregulated) case of physician balance billing. We show that both collusion-proof schemes and collusion-inducing schemes can implement cost-effective care. A number of policy implications are discussed. In particular, more permissive advertising of referred services (such as pharmaceuticals) and more informed patients will increase the cost of implementing collusion-proof mechanisms. If patients have a high willingness to pay or are informed, then allowing collusion may be preferred.
Flat capitation (uniform prospective payments) makes enrolling healthy enrollees profitable to health plans. Plans with relatively generous benefits may attract the sick and fail through a premium spiral. We simulate a model of idealized managed competition to explore the effect on market performance of alternatives to flat capitation such as severity-adjusted capitation and reduced supply-side cost-sharing. In our model flat capitation causes severe market problems. Severity adjustment and to a lesser extent reduced supply-side cost-sharing improve market performance, but outcomes are efficient only in cases in which people bear the marginal costs of their choices.
The 1989 reforms of the UK National Health Service introduced competition in supply within a tightly regulated framework. The paper examines whether this competition affects the prices posted by sellers of medical services. We argue that despite regulation market forces may have an impact on price. We test this using the posted prices for one of the two types of buyer, General Practice Fundholders. We find the regulatory rules are not observed, and some evidence of the impact of market forces on price.
The study aim was to evaluate the impact of the experimental introduction of salaried contracts in England on general practitioner (GP) behaviour and the quality of care. A controlled before-and-after design was implemented involving ten practices of standard contract GPs, paid largely by capitation and fee-for-service, and ten salaried GP practices. Diaries and routinely available data were used to assess GP workload, and patient assessments of the quality of care were obtained by postal questionnaire. GPs in salaried practices spent less time on practice administration but more working out-of-hours and in direct patient care, allowing more patients to be seen. Total list sizes were smaller in salaried compared with standard contract practices, but lists per GP were higher because of staffing policies. Salaried GPs tended to provide shorter consultations compared with standard contract GPs, prescribe in fewer consultations, but referral rates were similar. Quality was rated as higher for seven out of thirteen aspects of care examined in salaried practices and two in standard contract practices. However, none of these differences were statistically significant. To conclude, salaried contracts did not adversely affect GP productivity and had little impact on other aspects of GP behaviour or the quality of care provided.
The End-Stage Renal Disease Program is underfunded and overregulated. Objective parameters of end points of care do not correlate to specific clinical practice patterns. We do not have consensus between payers, providers, and patients as to what the objectives of the End-Stage Renal Disease Program are or should be. This report will address the need for an integrated health care delivery system that would benefit the end-stage renal disease patient and the barriers to designing such a system. The quality improvement program of a five-unit dialysis system will be described. The deficiencies of the quality improvement program and the limitation of the facilities to improve outcome will be discussed, and constructive alternatives to achieve an integrated health care delivery system that promotes improvement in patient outcomes will be suggested.
Diffusion of medical technology and the growing proportion of elderly people in the population are generally regarded as major contributors to the increasing health care expenditure in the industrialised world. This study explores the importance of one specific factor in this process, the change in the use of technology among elderly patients. In some instances, a new technology is first used among younger patients and then gradually extended to the elderly. Two such cases are studied, both representing costly procedures: coronary bypass surgery (treatment of coronary heart disease) and dialysis (treatment of uraemia). In both cases, we demonstrate significant diffusion to older age groups. It is also tentatively concluded that the diffusion of technology could have an important effect on per capita health care expenditure among the oldest of the old.
The introduction of an internal market in the National Health Service (NHS) in the United Kingdom necessitated the use of contracts between purchasers and providers. Little thought was given to the nature of these contracts by policy makers, who appeared to assume that the contracts could conform to the classical, complete model. This paper uses socio-legal and economic theories of contract (which provide an alternative model of relational contracts, in contrast to classical contracts) to explore how realistic that assumption was. An analysis of the institutional context in which the contracts were made is provided, including a legal analysis of the relevant legislation. Contracting by health authorities and GP fundholders is examined, using the results of a recent case study of contracting for district nursing services carried out in a health authority in Greater London. The results show that classical contracting is an inappropriate model for NHS contracts, but that relational contracting is not an entirely appropriate model either. Contracting was found to have increased the accountability of providers in respect of some financial matters, but not in respect of the quality of district nursing services. There are negative implications for the use of contracting in publicly financed health services--hierarchies may be more efficient (as lower transaction costs can be incurred) and possibly more effective in improving quality of care.
The flexibility inherent in the German health care system is fairly limited. The contracting environment itself is characterized by bilateral cartels negotiating the terms covering their respective members. Looking at some recently implemented reforms, namely structural contracts and experimental settings, the paper assesses the potential for sickness funds to take on a more active role. The paper also evaluates the implications for the contracting relationships between the statutory sickness funds and provider associations. Furthermore, the potential effect of selective contracting on the health care system is studied. A look at the reforms recently enacted in other countries illustrates the difficulties contractual reform has to cope with in an environment characterized by strong informational asymmetries. It is postulated that both private and public choices are needed for a successful reform effort.
The MULTIFIT system provides an infrastructure for the management of coronary risk factors and associated conditions. It is well integrated into standard medical practice, relying on existing personnel, facilities, and equipment. It integrates cognitive, executive, and organizational aspects of medical care delivery. It addresses an important national health goal: how to substitute relatively inexpensive preventive care for expensive palliative care for patients with established vascular disease.