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Subcapitation: sharing risks and rewards with community physicians.

P A Beckman1, M Feliberty Trivedi

  • 1Group Health Associates, Cincinnati, OH 45220, USA.

Medical Group Management Journal
|June 7, 1995
PubMed
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A multispecialty group formed a physician network using subcapitation and aligned incentives. This model enhances cost-effectiveness and physician cooperation in managed care settings.

Area of Science:

  • Healthcare Management
  • Health Economics
  • Network Medicine

Background:

  • Managed care growth necessitates integrated systems for medical groups.
  • Payers increasingly prefer collaborating with organized healthcare systems.
  • Adapting to evolving managed care markets is crucial for physician groups.

Purpose of the Study:

  • To present a model of a physician-led network for managed care.
  • To demonstrate the effectiveness of subcapitation and aligned incentives.
  • To explore a partnership between a multispecialty group and community physicians.

Main Methods:

  • A multispecialty group established a network with over 350 primary care and specialty physicians.
  • The network was designed for geographic coverage and cost-effectiveness.

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  • Subcapitation and aligned incentives were the core operational principles.

    • Main Results:

    • The network effectively delivers a wide array of specialty services cost-effectively.
    • Subspecialty and primary care groups benefit from integration with the multispecialty provider.
    • Physicians are incentivized for efficiency and cooperative improvement of patient care processes.

    Conclusions:

    • The developed network serves as a viable model for evolving managed care markets.
    • Physician participation in quality improvement committees fosters favorable arrangements.
    • Subcapitation with aligned incentives can successfully integrate care delivery.