Network capitation practices: a new concept

The percentage of consumers in the U. S. covered by dental insurance has increased dramatically over the last 10 years. As dental insurance grows, it is becoming increasingly important to examine the context of dental care payment systems. At present, almost all insurance programs are geared toward the fee-for-service system, which reimburses dentists a fixed sum for each type of procedure. The exceptions to fee-for-service dental insurance plans are few. A capitation program for dental care, which reimburses dentists a fixed amount per enrolled patient regardless of services rendered, offers many advantages for both consumers and providers and should be available as an option. Network capitation represents a new approach to the payment of dental care. A network capitation program is being developed in the United States and will use an approach involving two contracts, one which will be used with an insurance company, and the second with a network of private practitioners. The insurance company will supply dental practices with dental patients and funds on a capitation basis. Patients will be given the choice of fee-for-service or capitation. Network capitation allows fee-for-service solo or group practitioners to incorporate capitation patients into their practice.     

Determinants of general dentists' decisions to accept capitation payment: a conceptual model and empirical estimates

Abstract – Background: Shifts in payment options for dental care over several decades have resulted in more dental expenditures being paid through health maintenance organizations (HMOs), preferred provider organizations (PPOs), and capitation arrangements. Patients’ and employers’ choices to participate in these arrangements is determined in part by dentists’ willingness to participate in plans, and plan choices may be influenced by patient satisfaction, self‐reported oral health, and/or quality or cost of care. Objectives: This study examined determinants of dentists’ decisions to accept capitation payment for services. Research Design: Cross‐sectional mail survey in December 2006. Subjects: 1605 general dentists in Oregon. Measures: Questions addressed dentists’ perceptions of the importance of control over various practice parameters, willingness to accept capitation payment, employment or ownership status within the practice, and practice characteristics. Results: Capitation was accepted by 22.6% of the respondent dentists (n = 729). Reported average fees (2007 dollars) ranged from $60 (initial oral examination) to approximately $800 (porcelain crowns). The likelihood of accepting capitation payment was related to the number of dentists in the practice, but surprisingly owner‐dentists were no less likely than employee‐dentists (associates) to accept capitation. As expected, dentists’ usual and customary fees were negatively associated with accepting capitation. In contrast, measures of dentists’ importance of control were not related to decisions about capitation. Longer average appointment delays were related to acceptance of capitation, but the effects were small. Conclusions: Dentists’ behavior regarding payment acceptance is generally consistent with microeconomic theory of provider behavior. Study findings should inform practitioners, plan managers, and researchers in examining dentist payment decisions.     

A Comparison of Quality in a Dual-choice Dental Plan: Capitation versus Fee-for-service

The quality of dental care provided under a dual-choice dental plan was evaluated. Eleven practices, six capitation and five fee-for-service, were examined. The methodology was based primarily on examination of elements of structure and process of care. Samples of patient dental records were drawn from each practice for a total of 495 patient records. The results showed that none of the five fee-for-service dental practices and only two of the capitation practices were found to meet all the criteria for acceptable dental practice. Universally poor documentation made it extremely difficult to evaluate process measures of care. Fee-for-service patients received more visits and services than capitation patients. Overtreatment occurred in fee-for-service practices and undertreatment occurred in capitation practices. The distribution of services also differed, with capitation practices providing a less expensive type of service. Annual utilization of one or more services for capitation practices varied substantially by the practice. In this plan, both capitation and fee-for-service practices demonstrated a need for strong quality assurance mechanisms to protect the interests of patients.     

Dentists' participation in capitation and preferred provider organization dental plans

BACKGROUND: In 1998, the American Dental Association Survey Center conducted a telephone and mail survey of U.S dentists in private practice in an effort to determine the extent of dentists' participation in capitation and preferred provider organization, or PPO, dental plans and the characteristics of dentists who participate in those plans. METHODS: An initial phone screening survey was conducted with a random sample of 11,550 dentists in private practice. Dentists who indicated that they participated in capitation or PPO dental plans received a follow-up mail survey asking specific questions concerning these two types of dental plans. RESULTS: Almost one-half of responding dentists indicated that they participated in either capitation or PPO dental plans. However, far more dentists reported participating in PPO dental plans than in capitation dental plans. The majority of participating dentists' patients were reported to be fee-for-service patients. CONCLUSIONS: Dentists' participation in PPO dental plans generally increased from that indicated in previous surveys, though participation in capitation plans declined. There was some regional and demographic variation in participation in these dental plans, but such differences were not large. Pricing and concerns about quality of care continue to be the primary concerns of nonparticipating dentists. PRACTICE IMPLICATIONS: Dentists reporting participation in PPO dental plans are becoming more common, but such plans still do not cover the majority of participating dentists' patients. A large percentage of nonparticipating dentists cite pricing and concerns about quality care as reasons for not joining these plans.     

THE INCLUSION OF CAPITATION REIMBURSEMENT IN SOLO PRACTICE

Capitation reimbursement has been an integral part of prepaid group practices in both medicine and dentistry, and claims have been made for its ability to influence the delivery of services favorably. Experts have suggested that if capitation is implemented, more preventive care will be provided, more diagnostic services will be provided, there will be better continuity of care, utilization of high-cost services will be reduced, and clinical outcome will be improved. This study focused on the dominant mode of practice in dentistry, the general, solo practitioner, to determine if these contentions held. A sample of 245 patients whose care was paid for by a capitation mechanism was matched to a sample of 245 similar patients whose care was paid for on a standard fee-for-service basis--all from three dentists' practices. All services in all years of care for each patient were analyzed. It was determined that the rate of restorations was lower, while rates of diagnostic testing and prophylaxis were higher for capitation patients. Continuity was also better under capitation, but rates of extractions were virtually identical for the two groups.     

Characteristics of dentists participating in capitation and Preferred Provider Organization dental plans

BACKGROUND: In 1998, the American Dental Association Survey Center conducted a telephone and mail survey of U.S. dentists in private practice in an effort to determine the extent of dentists' participation in capitation and preferred provider organization, or PPO, dental plans and the characteristics of dentists who participate in those plans. METHODS: An initial telephone screening survey of a random sample of 11,550 dentists in private practice was conducted to identify dentists who participated in PPO or capitation dental plans. Dentists who participated in either of these plan types then were asked to complete a mail survey on their plan participation. RESULTS: The majority of dentists participating in either type of dental plan reported having never left a dental plan. Dentists who belonged to more than one PPO or capitation plan reported that a larger percentage of their patients were enrolled in these plans and that more of their practice's gross income came from the plans. Participation in PPO and capitation plans has had a positive impact on the practices of many of the responding dentists, particularly with regard to expanding their patient base. CONCLUSIONS: The authors found that the majority of dentists participating in PPO dental plans found it to be a positive experience overall. Dentists participating in capitation plans were less satisfied; more than 50 percent of capitation plan participants reported some level of dissatisfaction with the plans. The majority of dentists participating in a PPO plan expected to renew participation when their current contract expired; a much smaller percentage (though still a majority) of responding capitation-plan participants indicated the same. PRACTICE IMPLICATIONS: Responding dentists' overall indication of satisfaction with their current PPO plan participation probably indicates further growth for these dental plans. On the other hand, capitation plan participants seem much less satisfied with their plans. PPO plans, therefore, seem much more likely to be the type of plan that dentists will choose in the future.     

The Capitation Study. 2. Does capitation encourage more prevention?

The results of a 3-year parallel, controlled clinical trial comparing a capitation system of payment for the dental care of children with fee-for-service, showed that capitation offered dentists more clinical freedom. Dentists in capitation used this to provide more preventive care, particularly advice to parents on the control of dental disease in their children. In contrast, few fissure sealants were placed and few topical fluoride applications were made under either system. However, parents in both systems were satisfied with the preventive service their children received and were confident of their ability to control their children's dental disease. The effect of this increased preventive activity was not yet apparent within the period of the study.     

The capitation study. 1. Does capitation encourage "supervised neglect'?

Four matched pairs of geographically and socially contrasting areas of Britain were randomly allocated within pairs to either a capitation or fee-for-service payment system for the dental care of children in a 3-year clinical trial. Measurements were made on the dental health of randomly selected 5-6 and 14-15-year-old patients and the views of their parents elicited. Patterns of treatment were also gained from the clinical records of randomly selected patients. In addition, the views of the dentists taking part, of the profession's representatives, and of the administrators of the systems were obtained. No evidence of systematic neglect could be found among the children treated under capitation, but they had fewer fillings, more untreated diseased teeth and similar disease levels to their counterparts treated under fee-for-service. Dentists in capitation carried out fewer fillings, fewer extractions, took fewer radiographs and saw their patients less frequently than their fee-for-service colleagues.     

The capitation study. 3. The views of participating dentists and the profession

During the course of a 3-year parallel, controlled clinical trial comparing a capitation system of remuneration with fee-for-service for the dental care of children, the views of the dentists were gained through meetings, informal communication, and a structured questionnaire sent to every dentist in the study. The questionnaires completed by the dentists who had been in the study from the beginning were used in the analysis. The views of practice principals on practice administration were also gained. Dentists in capitation claimed to have greater clinical freedom than those in fee-for-service, but the system under test involved more practice administration. The trial allowed the two systems to be compared under limited, controlled conditions, thus benefiting any substantive scheme that might be developed from it.     

Capitation and indemnity in dental insurance.

The literature reviewed over the past year indicates several new trends in the area of health care capitation and indemnity third-party coverage. These trends point toward an increase in capitation and managed care and a decrease in traditional indemnity insurance. As employers seek to control all types of health care costs, they will also require employees to take care of a larger portion of the bill. As managed care plans increase, there will be a new emphasis on methods of plan evaluation. Cost will cease to be the only consideration. As quality comes into greater focus, there will be a need to define quality care in objective terms. Parameters of care will be needed as well as performance standards. Providers will be put increasingly at financial risk as managed care administrators seek to reduce provider numbers and control utilization. Capitated dental care is not as prevalent nationwide as is capitated medical care. Developments in general health care will influence how widespread it will become in the next decade.     

Capitation registration and social deprivation in England. An inverse 'dental' care law?

OBJECTIVE: To examine associations between NHS child dental registration data and area deprivation scores of English Health Authorities (N= 100) in 1996/97 and 1997/98. METHOD: The Department of the Environment index of local conditions and the Jarman Underpriviledge Area Score from the 1991 census were used to measure deprivation. Prior to September 1997, children got free dental treatment under a capitation scheme with an NHS dentist. If they did not attend within 24 months their registration lapsed on the last day of December of the second registration year and they were deleted from the capitation list. After September 1997 the registration period was reduced to 15 months. OUTCOME: Curve-linear regression of the Health Authority (HA) percentage of children registered, lapses in capitation registrations and deprivation scores. RESULTS: In England 68% of children were registered in December 1996. The percentage registered in each Health Authority was associated with deprivation (DoE, r2=0.33, Jarman, r2=0.27 p<0.01). In January 1997, 17.8% (1,345,142) of children registered lapsed (HA range 12.8% to 30.3%) and this was also significantly associated with deprivation (DoE r2=0.66, Jarman, r2=0.51 p<0.01). Similar results were found in 1997/98. CONCLUSIONS: Registration and lapse rates were significantly associated with social deprivation confirming that there is an inverse 'dental' care law for children in England. NHS capitation may widen dental health inequalities.     

Capitation and fee-for-service dental benefit plans: economic incentives, utilization, and service-mix

Insurance carriers, corporations, and labor groups are actively developing and marketing dental capitation benefit plans. Incentives to both dentists and patients in these plans differ from those in the traditional fee-for-service system used with conventional benefit plans. This paper describes the likely effects of these incentive differences on utilization and service-mix patterns in both systems. Data for a large (approximately 10,000), homogenous group of subscribers are presented and discussed. Faced with a dual option, at no cost to the employee, 60% of the subscribers chose the fee-for-service plan, and 40% chose the capitation plan. Observed differences in the utilization and mix of services between the two plans cannot be explained solely in terms of dentists' responses. Employee response to altered economic incentives appears to be strong.     

New York State Medicaid dental capitation plan.

The dental portion of the New York State Medicaid program has historically been limited in scope and access. While the Medicaid dental capitation plan introduced in recent years offers a new delivery system, it does not change fundamental flaws with the program. It continues to deny access to Medicaid recipients. This paper describes the state of Medicaid dental capitation enrollment in New York and its relationship to access to care--the principal idea behind DSSNY's class action suit against the state.     

Network capitation plans: an operational perspective

Dentistry's mission has been defined as improving the oral health of the public. In the ADA's report on the strategic plan for dentistry, the first priority addressed is to convert public unmet needs into a demand for dental services. One of the methods which the plan has outlined for action is to "expand dental prepayment and promote growth of innovative payment mechanisms." The prepaid capitation method of payment can and will provide a vehicle to service those unmet needs. Healthcare insurance companies are organizing regional and national networks of individual practices who will accept this method of prepayment. As in all systems of delivery, there are possibilities for abuse. This article addresses a prepaid capitation delivery system from an operational perspective, in order to identify the elements that should safeguard the patient, dentist, employer group, and carrier.     

Disease activity and need for dental care in a capitation plan based on risk assessment

This article describes a capitation model of care which would stimulate both dentists and patients to apply existing preventive knowledge.     

Scottish dentists' preferences for remuneration and their opinions on the scope of General Dental Service treatment

A questionnaire was sent to a list of what was considered to be all dentists currently in practice in the General Dental Service (GDS) and Community Dental Service (CDS) in Scotland; 72% responded. The dentists were asked to indicate the general method by which they would prefer to be paid, given a choice of fee for item-of-service, salary or capitation. Opinion was split among the GDS respondents, between fee for item-of-service (34.9%), a salaried system of payment (32.6%), or a service based on differing remuneration systems for the dental care of adults and children (22.5%). Only 22.6% of GDS respondents said they would prefer a capitation system for the treatment of child patients. Most CDS respondents said they preferred to be salaried. Dentists in both services were asked if they felt there was a need to extend the range of treatment items which are currently permitted in the GDS; most felt that there was. About 80% of all respondents felt that there was a need to allow payment for various items of preventive dental care within the GDS. Almost a third of GDS respondents also mentioned various items of restorative dental treatment which they felt should be funded (a concern which fewer CDS respondents (6.7%) mentioned). Few respondents suggested any other additional types of treatment items.     

Dental benefits and reimbursements

This article analyzes and compares the various dental benefit reimbursement methodologies currently available in the dental marketplace. Emphasis is placed on the advantages and disadvantages of the capitation/HMO approach from the point of view of the patient, dentist, plan administrator, and purchaser/employer.     

Capitation--an alternative payment system for the treatment of children in the general dental service

The Health Departments' recent proposals for the new GDP contract include capitation payment for children's dental care. Manchester University's Dental Health Services Research Unit has been running a clinical trial of such a scheme for the last three years on behalf of the Departments and the BDA. The results of this scheme will be of major importance to the decision about any new payment system. This article describes the trial project, and reports some preliminary findings.     

Capitation dentistry: incentives and implications

Capitation is an incentive-based form of payment for dental care. Unlike fee-for-service benefit plans, the nature of reimbursement in capitation plans provide dentists with the necessary incentives to perform appropriate and necessary level of care, seek less costly but effective alternatives, and place an emphasis on prevention. This paper examined how some of these incentives work and their effects on the practice of dentistry.     

Randomized pilot study to disseminate caries-control services in dentist offices

Background  

To determine whether education and financial incentives increased dentists' delivery of fluoride varnish and sealants to at risk children covered by capitation dental insurance in Washington state (U.S.).