The primary care network--a new type of HMO for private practice physicians

A new type of health maintenance organization has been developed to encourage primary care physicians in private practice to become coordinators and financial managers for all medical care. Each patient chooses one internist, family or general physician, or pediatrician and must be referred by that physician for all hospital admissions and care by specialists. The primary care physician authorizes all payments from his own account for care provided to his patients. He shares any deficit or surplus remaining at the end of the year. Hospital admission rates and length of stay are lower than those of Blue Cross, with only one of three dollars paid to hospitals. The plan is providing care to 38,000 persons with 750 participating physicians in Northern California, Washington and Utah. This plan represents an attempt by physicians to control costs without government regulation.