Physician's production of primary care in Ontario, Canada

This paper examines the factors affecting the number of patient visits per week reported by family physicians in Ontario. The way that a physician is paid is potentially endogenous to the number of patients seen per week, thus an instrumental variable method of estimation is employed to account for the endogeneity bias. Once account is taken of the endogeneity of remuneration as well as relevant physician and practice characteristics, the estimated elasticity of output with respect to hours worked is 0.74; 0.68 in group practices and 0.82 in solo practices. Physicians paid on a non-fee-for-service (NFFS) conduct 15-31% fewer patient visits per week in comparison to those paid under an FFS scheme. Certain patient populations in practices affect patient visits in important ways, as do a number of physician and practice characteristics.