Framework for the design of physician remuneration methods in primary health care

Economists have generated a large body of theoretical and empirical knowledge with respect to the design of physician remuneration methods (PRM). This knowledge is difficult to use for a policy maker, because of its technical nature and its fragmentation. The article brings together the scattered elements of theory and evidence into a structured framework that adds practical use value to economic theory, useful in the applied practice of policy development, design, implementation, and evaluation. The article argues that the optimal choice of PRM depends on the goals of the health care system, and on external contextual factors. Fee-for-service payments are best when the goals are quantity of care and risk acceptance. Capitation is best when the goals are collaboration between providers and delivery of preventive services and health promotion. Salaries are best when population density is low, and the goal is to recruit physicians to rural and remote areas. Blended payment models are recommended for the achievement of multiple goals. As a demonstration of use value, the framework is applied to the assessment of Canadian PRM.