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Where is the financial safety net for managed care physicians?
1University of Pittsburgh, Montefiore University Hospital, PA 15213, USA.
The American Journal of Managed Care
|May 26, 1999
Summary
Managed care physicians face financial risk. Risk modification strategies like risk pooling can improve equitable reimbursement for physicians with small patient panels, but increasing patient volume is key.
Area of Science:
- Health Economics
- Managed Care
- Physician Reimbursement
Background:
- Managed care physicians face financial risks.
- Limited empirical research exists on how physicians mitigate these risks.
Purpose of the Study:
- Investigate the relationship between risk sharing and physician reimbursement in managed care.
- Examine how risk modification strategies affect the match between capitation payments and care costs.
Main Methods:
- Utilized payment simulations with 2 years of managed care claims data from 82,525 patients.
- Examined net provider payments under various risk modification scenarios: stop-loss insurance, age/gender adjustment, and risk pooling.
Main Results:
- Provider patient panel size positively correlated with net per capita payment (r=0.22, P<0.0001).
- Risk modification strategies reduced payment variance, with risk pooling most effective for smaller panels (<135 patients).
- Age/gender adjustment had minimal impact on reimbursement outcomes.
Conclusions:
- Risk modification strategies offer limited equitable reimbursement for small physician panels without increasing patient volume.
- Managed care dynamics may favor group practice models that facilitate larger patient panels within a single plan.