Effect of managed care and financing on practice constraints and career satisfaction in primary care

BACKGROUND: The shift away from third party insurers to risk-sharing arrangements affecting care management and clinicians could be the most fundamental change in the health care system. Analysis was undertaken to study how managed care, practice setting, and financial arrangements affect physicians' perceived impact on their practice. METHODS: Data were taken from the Community Tracking Study (CTS) physician survey, a national survey of active physicians in the United States fielded between August 1996 and August 1997. Survey instruments were completed by 7,146 primary care physicians in internal medicine (2,355), family practice (3,168), and pediatrics (1,623). The dependent variables are career satisfaction and perceived limitations and pressures on time spent with patients, clinical freedom, income, and continuity. To study the unique effect of financing and gatekeeping arrangements and practice setting, the dependent variables were regressed on gatekeeping, practice revenue, individual physician compensation, practice setting, specialty, age-group, sex, international medical graduate, board certification, and recent change in practice ownership. RESULTS: Total managed care revenue, or individual physician incentives, have no effect on career satisfaction and relatively limited effects on time pressure, income pressure, or patient continuity. In contrast, primary care gatekeeping has a highly significant adverse effect on the same outcome measures. After controlling for financial factors, demographic characteristics, and training differences, physicians in solo and 2-physician practices are significantly more likely to be dissatisfied with their medical career, more likely to report no clinical freedom, and more likely to feel income pressure than physicians in group practices, staff model HMOs, medical schools, or other settings. CONCLUSION: Physicians in solo and 2-physician practices were least satisfied with their careers and reported more constraints on their clinical freedom and income than physicians in other settings. Physicians in group practices or staff model HMOs are more likely to report time pressure than physicians in solo or 2-physician practices. Family practice falls between internal medicine (less satisfied, more practice constraints) and pediatrics (more satisfied, fewer practice constraints).     

Characteristics of medical practices in three developed managed care markets

OBJECTIVE: To describe physician practices, ranging from solo and two-physician practices to large medical groups, in three geographically diverse parts of the country with strong managed care presences. DATA SOURCES/STUDY DESIGN: Surveys of medical practices in three managed care markets conducted in 2000-2001. STUDY DESIGN: We administered questionnaires to all medical practices affiliated with two large health plans in Boston, MA, and Portland, OR, and to all practices providing primary care for cardiovascular disease patients admitted to five large hospitals in Minneapolis, MN. We offer data on how physician practices are structured under managed care in these geographically diverse regions of the country with a focus on the structural characteristics, financial arrangements, and care management strategies adopted by practices. DATA COLLECTION: A two-staged survey consisting of an initial telephone survey that was undertaken using CATI (computerized assisted telephone interviewing) techniques followed by written modules triggered by specific responses to the telephone survey. PRINCIPAL FINDINGS: We interviewed 468 practices encompassing 668 distinct sites of care (overall response rate 72 percent). Practices had an average of 13.9 member physicians (range: 1-125). Most (80.1 percent) medium- (four to nine physicians) and large-size (10 or more physicians) groups regularly scheduled meetings to discuss resource utilization and referrals. Almost 90 percent of the practices reported that these meetings occurred at least once per month. The predominant method for paying practices was via fee-for-service payments. Most other payments were in the form of capitation. Overall, 75 percent of physician practices compensated physicians based on productivity, but there was substantial variation related to practice size. Nonetheless, of the practices that did not use straight productivity methods (45 percent of medium-sized practices and 54 percent of large practices), most used arrangements consisting of combinations of salary and productivity formulas. CONCLUSIONS: We found diversity in the characteristics and capabilities of medical practices in these three markets with high managed care involvement. Financial practices of most practices are geared towards rewarding productivity, and care management practices and capabilities such as electronic medical records remain underdeveloped.     

Primary care physician incentives in medical group practices

CONTEXT: Although medical groups are adapting to changes in financing health care, little is known about individual physician incentives in this environment. OBJECTIVES: To describe methods group practices use to compensate primary care physicians in a managed care environment and to examine the association of revenue sources for the group practice from all patients and primary care physician incentives. DESIGN: We surveyed by mail group practice administrators for practices that had at least 200 members continuously enrolled in 1995. SETTING: Group practices that had contractual arrangements with Blue Cross/Blue Shield of Minnesota. PARTICIPANTS: One hundred of 129 group practices returned usable surveys. RESULTS: Most groups had some portion of primary care physicians' compensation at risk, although 17 groups compensated them through fully guaranteed annual salary. Seventy-one groups used productivity, 4 groups used quality of care, 1 group used utilization, and 30 used group financial performance. Factors reported to significantly influence primary care physician compensation included billings or charges, overall group practice performance, and net revenue or profit. Groups that had a higher proportion of income from various types of fee-for-service arrangements used lower proportions of base salary for primary care physician compensation and were more likely to relate physician income to measures of productivity. CONCLUSIONS: Substantial variation exists in the types of primary care physician incentives implemented by medical groups. Base salary, individual productivity, and group financial performance were most frequently used to determine compensation. Physician personal financial risk was higher overall in group practices that derived more revenue from fee-for-service contracts.     

No exodus: physicians and managed care networks

After remaining stable since 1996-97, the percentage of U.S. physicians who do not contract with managed care plans rose from 9.2 percent in 2000-01 to 11.5 percent in 2004-05, according to a national study from the Center for Studying Health System Change (HSC). While physicians have not left managed care networks in large numbers, this small but statistically significant increase could signal a trend toward greater out-of-pocket costs for patients and a decline in patient access to physicians. The increase in physicians without managed care contracts was broad-based across specialties and other physician and practice characteristics. Compared with physicians who have one or more managed care contracts, physicians without managed care contracts are more likely to have practiced for more than 20 years, work part time, lack board certification, practice solo or in two-physician groups, and live in the western United States. The study also found substantial variation in the proportion of physicians without managed care contracts across communities, suggesting that local market conditions influence decisions to contract with managed care plans.     

The ethics of managed care. An initial look at physicians' perspectives

The need for medical care in the United States had exceeded the financial resources required to pay for that care. To address this problem, managed care health insurance programs have become commonplace. With managed care programs, however, physicians are facing increasing ethical pressures. This article reviews the ethical dilemmas physicians face under a managed care system and conducts a national random sample of general practitioners and surgeons regarding four major ethical dilemmas: under treatment of patients due to overt pressures or financial incentives, breaches of patient confidentiality by the physician that are required by the managed care plan, lack of disclosure to the patient of the financial incentives or overt pressures under which the physician functions, and overuse of practice guidelines. The results of this survey suggest that physicians are more likely to compromise patients' confidentiality and not discuss financial arrangements with patients than they are to compromise actual patient care. Those physicians with more than 30 percent of their patient load coming from managed care are more likely to have faced the scenarios presented by the survey. There is, however, no statistically significant difference in the physicians' responses to these scenarios based on the percentage of the physicians' patient load coming from managed care.     

US physicians' perceptions of the effect of practice guidelines and ability to provide high-quality care

OBJECTIVES: In the USA, health care organizations frequently disseminate practice guidelines to physicians, but physicians often resist implementing guidelines when they perceive no improvements in quality of care will result. Greater involvement with a single health care organization may a inverted exclamation market physicians' perceptions of guidelines. We examined the relationship between the perceived effect of guidelines on practice and perceived quality of care for US primary care physicians (PCPs) and specialists with varying levels of financial involvement with a single managed care organization. METHODS: Data were from the 1996-1997 Community Tracking Study, a nationally representative, cross-sectional survey of 12,528 physicians. Data were adjusted for possible confounders using ordinal logistic regression. RESULTS: Almost half the physicians described a moderate to very large perceived effect of guidelines (46% of PCPs, 46% of specialists). Physicians' financial involvement with a single organization was modest: PCPs received on average 24% of their revenue from their largest contract, while specialists averaged 18%. For specialists, increasing perceived effect of guidelines was associated with increasingly negative perceptions of quality of care [beta= -0.16, 95% confidence interval (-0.22, -0.10)]. Similar results were obtained for PCPs with low levels of financial involvement with a single organization. However, this negative association disappeared for PCPs with higher levels of financial involvement. CONCLUSIONS: PCPs with substantial financial involvement with a single organization who perceive greater effects of guidelines on practice have less negative perceptions of their ability to provide high-quality care. Although our data cannot confirm a causal relationship, financial involvement with a single organization may be one factor linking practice guidelines to high-quality care.     

Physicians moving to mid-sized, single-specialty practices

The proportion of physicians in solo and two-physician practices decreased significantly from 40.7 percent to 32.5 percent between 1996-97 and 2004-05, according to a national study from the Center for Studying Health System Change (HSC). At the same time, the proportion of physicians with an ownership stake in their practice declined from 61.6 percent to 54.4 percent as more physicians opted for employment. Both the trends away from solo and two-physician practices and toward employment were more pronounced for specialists and for older physicians. Physicians increasingly are practicing in mid-sized, single-specialty groups of six to 50 physicians. Despite the shift away from the smallest practices, physicians are not moving to large, multispecialty practices, the organizational model that may be best able to support care coordination, quality improvement and reporting activities, and investments in health information technology.     

Effects of changes in incomes and practice circumstances on physicians' decisions to treat charity and Medicaid patients

CONTEXT: The decline over the past decade in the percentage of physicians providing care to charity and Medicaid patients has been attributed to both financial pressure and the changing practice environment. Policymakers should be concerned about these trends, since private physicians are a major source of medical care for low-income persons. This study examines how changes in physicians' practice income, ownership, and size affect their decisions to stop or start treating charity care and Medicaid patients. METHODS: This study uses panel data from four rounds of the Community Tracking Study Physician Survey. The dependent variables are the likelihood of physicians' (1) dropping charity care, (2) starting to provide charity care, (3) no longer accepting new Medicaid patients, and (4) starting to accept new Medicaid patients. The primary independent variables are changes in physicians' practice income, ownership, and practice type/size. Multivariate analysis controls for the effects of other physician practice characteristics, health policies, and health care market factors. FINDINGS: A decline in physicians' income increased the likelihood that a physician would stop accepting new Medicaid patients but had no effect on his or her decision to provide charity care. Those physicians who switched from being owners to employees or from small to larger practices were more likely to drop charity care and to start accepting Medicaid patients, and physicians who made the opposite practice changes did the reverse. CONCLUSIONS: Changes in their income and practice arrangements make physicians less willing to accept Medicaid and uninsured patients. Moreover, physicians moving into different practice arrangements treat charity and Medicaid patients as substitutes rather than as similar types of patients. To reverse these trends, policymakers should consider raising Medicaid reimbursement rates and subsidizing organizations that encourage private physicians to provide charity care.     

Kinder and gentler: physicians and managed care, 1997-2001

Despite the managed care backlash, an overwhelming majority of U.S. physicians continue to contract with managed care health plans. In fact, according to a new Center for Studying Health System Change (HSC) study, between 1997 and 2001 physicians reported a modest increase in the proportion of practice revenue from managed care contracts and the average number of contracts. At the same time, the nature of physicians' relationships with health plans changed, with a significant decrease in plans' use of capitation, or fixed monthly payments for each patient regardless of the amount of care provided. Meanwhile, physician practices moved away from using direct financial incentives to influence doctors' clinical decision making, but did experience an increase in the overall influence of treatment guidelines and other practices commonly associated with managed care.     

Managed care plans and the organizational arrangements with group practices

This article addresses the variety of structural and legal arrangements between group practices and health plans. The continuum of relationships will be discussed, including long-term arrangements whereby in exchange for long-term commitments to provide physician capacity, providers are given a capital contribution from managed care plans; management services organizations whereby managed care plans create management companies that provide turnkey management services in exchange for capital, with a commitment by the group practices to provide physician services to the health plan over a long period of time; mixed equity relationships where physicians and managed care plans jointly own the group practice, which group practice also has an ownership interest in the managed care plan itself; and acquisition of the group practice by the managed care plan. Each of these structures will be described, along with the legal issues that may be considered in any of these relationships.     

Determinants of preventive practices in fee-for-service primary care

A study of primary care physicians was conducted in the provinces of Quebec and New Brunswick, Canada, to ascertain their patterns of preventive practice with respect to cancer in four anatomic sites: breast, cervix, colon-rectum, and lung. The determinants of preventive practices among 552 fee-for-service physicians in both provinces are explored. Scales were created for the practice behaviors related to each type of cancer (dependent variables) and for knowledge and belief (independent variables). The content of these scales was delineated through factor analysis and their reliability assessed using Cronbach's alpha. Other variables were considered in the analysis, including continuing education activities, perceived barriers to prevention, and other sociodemographic and professional variables. Bivariate analysis and multivariate techniques were used. The explanatory factors were regrouped into cognitive, sociodemographic, and organizational determinants. Particular patterns were delineated for each cancer type. In a fee-for-service reimbursement setting without specific incentives for preventive practices, the creation of favorable organizational environments and the conveying of agreed-upon information to physicians are important ways of enhancing the integration of preventive activities into clinical practice. Identification of the sociodemographic determinants of preventive practices reveals the complexity of physicians' behaviors.     

Rural-urban differences in primary care physicians' practice patterns, characteristics, and incomes

CONTEXT: Low salaries and difficult work conditions are perceived as a major barrier to the recruitment of primary care physicians to rural settings. PURPOSE: To examine rural-urban differences in physician work effort, physician characteristics, and practice characteristics, and to determine whether, after adjusting for any observed differences, rural primary care physicians' incomes were lower than those of urban primary care physicians. METHODS: Using survey data from actively practicing office-based general practitioners (1,157), family physicians (1,378), general internists (2,811), or pediatricians (1,752) who responded to the American Medical Association's annual survey of physicians between 1992 and 2002, we used linear regression modeling to determine the association between practicing in a rural (nonmetropolitan) or urban (standard metropolitan statistical area) setting and physicians' annual incomes after controlling for specialty, work effort, provider characteristics, and practice characteristics. FINDINGS: Rural primary care physicians' unadjusted annual incomes were similar to their urban counterparts, but they tended to work longer hours, complete more patient visits, and have a much greater proportion of Medicaid patients. After adjusting for work effort, physician characteristics, and practice characteristics, primary care physicians who practiced in rural settings made $9,585 (5%) less than their urban counterparts (95% confidence intervals: -$14,569, -$4,602, P < .001). In particular, rural practicing general internists and pediatricians experienced lower incomes than did their urban counterparts. CONCLUSIONS: Addressing rural physicians' lower incomes, longer work hours, and greater dependence on Medicaid reimbursement may improve the ability to ensure that an adequate supply of primary care physicians practice in rural settings.     

Professional integrity in the age of managed care: views of physicians.

At the end of 1997, one quarter of the American public used health maintenance organizations. This paper reports findings on physicians' perspectives on the role of managed care in their professional practices. The research data come from mailed surveys to physicians who are selected from the Cigna Directory of Physicians practicing in the State of Ohio. Subjects were asked to explain what managed care meant to them, and how long they have been practicing medicine. Questions also focused on professional autonomy, quality of care and career aspirations for the future. The results from the study suggest that managed care has had a negative impact on how physicians practice medicine. Several of our respondents reported that they are playing the role of a "double agent" and feel a sense of frustration in doing so. The degree of antipathy toward managed care differs between primary care physicians and specialists.     

The impact of perceived barriers on primary care physicians' screening practices for female partner abuse

OBJECTIVES: Our purpose was to examine primary care physicians' screening practices for female partner abuse in different clinical situations and to investigate the relationship between perceived barriers and screening practices. METHODS: A cross-sectional survey was mailed to Alaska physicians practicing in the following specialties: family practice, internal medicine, obstetrics/gynecology and general practice. RESULTS: The survey response rate was 80 percent (305/383). The majority (85.7%) of primary care physicians screened often or always when a female patient presents with an injury, but they rarely screened at initial visits (6.2%) or annual exams (7.5%). More than one-third of respondents estimated that 10% or more of their female patients had experienced some type of intimate partner abuse. Several barriers to screening described in the literature were not predictive of physicians' screening practice patterns. Physicians' perceptions that abuse is prevalent among their patients and physicians' beliefs that they have a responsibility to deal with abuse were the only variables independently associated with screening at initial visits and annual exams. The only variable predictive of screening when a patient presents with an injury was physicians' perceived prevalence of abuse. CONCLUSION: Primary care physicians have not integrated screening for partner abuse into routine care. Strategies to increase awareness of the high prevalence of abuse in the primary care setting and to educate providers on the negative health effects of victimization can help physicians to acknowledge their responsibility in addressing abuse and the importance of screening at routine visits. Further rigorous studies are needed to identify and evaluate predictors of screening for abuse.     

The organization of medical practice and primary care physician income

This study investigates the effect of the organization of medical practice, e.g., solo, fee-for-service group, or health maintenance organization (HMO) settings, on primary care physicians' net incomes. Using pooled data on 2,372 primary care physicians, multivariate regression analysis is used to adjust physicians' 1979 net incomes for differences in medical specialty, workload, sex, and experience before estimating the effects of the organization of medical practice. Among HMO physicians, only those in staff model HMOs were found to have significantly lower net incomes than their fee-for-service group practice counterparts. Accordingly, there is little evidence to support the popular belief that physicians practicing in HMOs consistently earn less than their fee-for-service counterparts. (Am J Public Health 1983; 73:379-383.)     

Factors affecting primary care physicians' perceptions of health system reform in Israel: professional autonomy versus organizational affiliation

This paper examines primary care physicians' perceptions of a National Health Insurance Law that introduced managed competition into Israel's health care system, and the factors affecting their perceptions. Between April and July 1997, we conducted a mail survey of primary care physicians employed by Israel's four health plans (which are managed care organizations). Eight hundred questionnaires were returned, representing a response rate of 86%. The findings indicate that, overall most physicians support the components of the National Health Insurance Law with statistically significant differences among physicians by health plan. Multivariate analysis revealed that, contrary to theoretical expectations, a perceived decrease in professional autonomy and in the status of the profession following reform did not significantly affect attitudes toward national health insurance. These findings highlight the need for additional empirical studies to further examine theoretical contentions about the implications of infringing on the professional autonomy and the dominant status of physicians. The principal and most interesting finding of this study was the independent effect of health plan affiliation on physicians' attitudes toward each of the five components of the National Health Insurance Law, after controlling for background characteristics, for the reform's perceived effect on the physicians' autonomy and status in the health plan, and for the reform's perceived effect on the level of health plan services and the health plan's financial situation. We found that physicians' perceptions tended to conform to the formal position of their health plan, suggesting the need to analyze the attitudes of physicians in their organizational context, rather than treating them as members of a uniform professional community.     

Caring for patients under Medicaid mandatory managed care: perspectives of primary care physicians

The purpose of the study was to describe the experiences of primary care physicians caring for Medicaid recipients in a demonstration mandatory health maintenance organization (HMO) managed care program. The authors collected data through semistructured individual or focus group interviews with 14 physicians and through interviews with the chief executive officers of the three HMOs participating in the demonstration program. Interview questions, developed initially from a review of the literature, addressed physicians' experiences as primary care providers for Medicaid recipients under traditional fee-for-service and under managed care arrangements through the demonstration program. Four themes emerged: providers' hassles and burdens, the complex needs of Medicaid patients, improved access to care under managed care, and individual providers' disconnect from the processes of health policy implementation and program evaluation.     

Institutional forces in the acceptance of managed care practices by physicians

We evaluated physicians' acceptance of managed care using data from Connecticut physicians. We grouped physicians' attitudinal responses on three dimensions and applied an institutional distance framework to evaluate factors that influence physicians' acceptance of managed care practices. Our results demonstrate the potency of institutional forces in affecting physician attitudes: health care organizations must more effectively integrate their values and beliefs with the physician community. The institutional distance theory evaluated in this article provides new information for policymakers and managers as gaining physician acceptance of certain practices is necessary to ongoing efforts to reform the health care system.     

Impact of practice arrangements on physicians' satisfaction

This research examines the effect of practice arrangements on five dimensions of physicians' satisfaction (i.e., personal factors, resources, peer review, profession, and state regulations) and the moderating effect of job autonomy and decision making on this relationship. This research finds that physicians who work for HMOs and hospitals are more satisfied with job resources, regulatory climate, and their professions, compared with physicians who are self-employed (solo and group practices). Physicians who work for HMOs and hospitals have less autonomy and decision-making power, compared with self-employed physicians. Also, job autonomy partially moderates the relationship between organizational arrangement and physicians' satisfaction with job resources and satisfaction with the profession. Decision making does not moderate the organizational arrangement and physicians' satisfaction relationship.