Impact of Increased Capitation on Revenue Distribution Among General Practitioners: A Norwegian Case Study

During recent years, many countries have moved from pure fee-for-service (FFS) systems toward mixed payment arrangements combining capitation and FFS components. In Norway, regular general practitioners (GPs) typically provide primary care under mixed capitation and FFS remuneration. ​Recently, increased proportion of capitation has been suggested.

This study investigates the impact of increasing the proportion of capitation on GP revenue distribution. Flat capitation and two types of risk adjusted capitation are examined.

Detailed data from Oslo, Norway are used to describe the differences in list composition among GPs. Increased capitation is calculated under the restriction of constant aggregated revenue to GPs. Risk adjusted capitation is calculated according to existing formulas and ordinary least squares regression.

Increasing the capitation fee to 50% of total revenue benefits GPs with long lists, but it disadvantages those with a high proportion of patients with a need for long-term care (LTC) services. However, risk-adjusted capitation according to patient-adjusted capitation (PAC) and need for LTC favors GPs with high proportions of frail patients, ensuring a more equitable revenue distribution.

This study underscores the importance of risk adjustment in capitation systems in order to prevent adverse incentives for patient selection and to maintain equitable income distribution among GPs. ​ An equitable revenue distribution among GPs is a precondition for implementing reforms of the payment system. Medical associations are powerful organizations that can block reforms considered desirable by governments. The results have broader implications for health policy, particularly around managing the financial sustainability and the service quality of primary care for an aging population. Policymakers are advised to consider these findings when debating changes to the remuneration system, to ensure that GPs are incentivized to provide comprehensive care without compromising access for high-need patients.