Primary care physicians can be compensated in a number of ways. The most popular are capitation, fee-for-service, salary, or some mixture of the three. But how does the physician compensation method affect care levels? This is the question Gosden et al. (2000) try to answer in their Cochrane review. The authors search the literature for randomized trials or controlled before and after studies in order to see how changing physician compensation affects the quantity and quality of care.
A summary of the 4 papers which met Gosden et al.’s criteria is below.
| Category | Davidson 1992 | Hickson 1987 | Krasnik 1990 | Hutchinson 1996 |
| Country | US | US | Denmark | Canada |
| Type | Randomized Trial | Randomized Trial | Before-and-After | Before-and-After |
| Payment | i) age-adjusted capitation; ii) Medicaid FFS; iii) more lucrative FFS | i) FFS; ii) Salary | Control: Cap/FFS mix; Intervention: Capitation only, changes to Cap/FFS mix | Before: FFS; After: mixed capitation, ambulatory care incentive |
| Physicians | Primary Care Providers (PCPs) | Residents | General Practitioners (GPs) | GPs/Family Physicians |
| Results | Comparing FFS and capitation, there was no difference in the number of PCP visits. | There was no difference in the number of patients attended | The number of face-to-face and phone visits was higher in the control group than the intervention group. | Hospital days decrease in all groups, but the change is similar across all payment types. |
| Controlling for covariates, there were 0.5-0.6 more visits for the capitation group compared to the Medicaid FFS. | There were more ER visits for the salaried group compare to the FFS group. | After the FFS was implemented in the intervention group, visits increased and converged to that of the control group. | ||
| The new, more lucrative FFS increase PCP visits by .8-.9 per patient compared to the Medicaid FFS. | Salaried doctors have fewer well-child visits per enrollee | After the FFS implementation [intervention group], the number of diagnostic and curative services order increased. | ||
| PCPs paid via capitation used fewer specialist and hospital resources | After the FFS implementation [intervention group], the number referrals to specialists fell | |||
| Patients were less likely to reach recommended visit levels in capitation compared to FFS | ||||
The original four articles:
- Stephen M. Davidson, Larry M. Manheim, Mina M. Hohlen, Stephen M. Werner, Beth K. Yudkowsky, and Gretchen V. Fleming, “Prepayment with Office-Based Physicians in Publicly Funded Programs: Results from the Children’s Medicaid Program” PEDIATRICS Vol. 89 No. 4 April 1992, pp. 761-767.
- Gerald B. Hickson, William A. Altemeier, and James M. Perrin “Physician Reimbursement by Salary or Fee-for-Service: Effect on Physician Practice Behavior in a Randomized Prospective Study ” PEDIATRICS Vol. 80 No. 3 September 1987, pp. 344-350.
- B. Hutchison, S. Birch, J. Hurley, J. Lomas and F. Stratford-Devai (1996) “Do physician-payment mechanisms affect hospital utilization? A study of Health Service Organizations in Ontario” Canadian Medical Association Journal, Vol 154, Issue 5 653-661.
- A Krasnik, P P Groenewegen, P A Pedersen, P von Scholten, G Mooney, A Gottschau, H A Flierman, and M T Damsgaard “Changing remuneration systems: effects on activity in general practice.” BMJ. 1990 June 30; 300(6741): 1698–1701.