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Understanding provider behavioral responses to capitation prepayment systems: an integrated mixed-methods approach
Tao Zhang1, Boyu Li1, Jing Liu2
1Department of Health Policy and Management, School of Public Administration, Hangzhou Normal University, Hangzhou, China.
Cost Effectiveness and Resource Allocation : C/E
|June 27, 2026
Summary
Provider responses to capitation prepayment in China are driven by cost-control measures, influenced by external factors and resources. Policy must address unintended consequences like service shifting for effective healthcare reform.
Area of Science:
- Health Services Research
- Health Economics
- Public Health Policy
Background:
- Provider payment mechanisms significantly shape healthcare delivery.
- China's Integrated County Healthcare Consortium (ICHC) system utilizes capitation prepayment.
- Understanding provider behavior under these reforms is crucial for system effectiveness.
Purpose of the Study:
- To examine capitation prepayment implementation within China's ICHC system.
- To elucidate factors influencing provider behavioral responses.
- To analyze the resulting healthcare system dynamics.
Main Methods:
- Mixed-methods study in Datong prefecture, China.
- Qualitative analysis (LDA) of 63 interviews.
- Social Network Analysis (SNA), Interpretative Structural Modeling (ISM), and System Dynamics Model (SDM) with 2015-2019 hospital data.
Main Results:
- Provider behavior influenced by external environment, institutional resources, and management strategies (cost control).
- Management strategies directly determined behavior; environmental and resource factors moderated payment incentives.
- Simulations revealed potential cost-shifting from inpatient to outpatient services.
Conclusions:
- Provider responses to capitation are primarily driven by institutional cost-control measures.
- Contextual and resource factors mediate these responses.
- Policy should mitigate unintended consequences like service shifting via referral and monitoring improvements.
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