Unhealthy trends: the future of physician services

In this paper we review current trends in payment systems, work settings, favored services, and accountability mechanisms that characterize physician practice. Current trends are pointing to higher spending, more tiering of access to care by ability to pay, and a greater role for larger practices that include both primary care and specialist physicians. Medicare's purchasing role is policymakers' most powerful lever to alter negative trends. Making fee-for-service payment more accurately reflect cost structures could immediately address some of these issues. Medicare can lead longer-term efforts to incorporate more per episode and capitated elements into the payment system, revamping incentives for physicians.