Preparing for managed care: family practice residents and capitated care in community health centers

This article examines the financial impact on patients of family practice residents when a community health center (CHC) serving as a residency training site is converted to a capitated payment system. The costs in this analysis included using and educating family practice residents at CHCs, the cost of patient encounters at CHCs, and the cost of contracted capitated services. These costs were measured against capitated per member per month (pmpm) payments received by the CHC. If capitated patients were cared for by residents, the CHC would lose $8.42 pmpm. The CHC faced a $5.98 pmpm loss if it used staff physicians rather than residents. This analysis suggests there are educational costs associated with training physicians in capitated health care delivery systems. Family practice residencies and CHCs must prepare for the conversion to capitated systems; academic centers with managed care contracts must control patient encounter costs and utilization to remain competitive.     

Proposal to reimburse occupational medicine disease and injury claims through third party health insurance

The current system of compensation for the medical costs of occupational illnesses and injuries, a component of health insurance coverage for most workers in the United States, has recently come under scrutiny in the national health care reform debate. The cost of treatment of these conditions is significant, and there exist numerous disincentives for physicians and patients to use the workers' compensation system. Physicians who treat workers with occupationally related diseases may find compensation for a condition is disputed at the same time that it is excluded from payment by third party insurance coverage, leaving the patient selectively uninsured for at least some medical care services. In addition, most workers' compensation programs have been designed in a way that discourages efficient resource use by providers and claimants. We propose allowing health care providers to bill third party health insurers for all care, including work-related diseases and injuries. Insurers, in turn, would bill workers' compensation programs for associated treatment costs. The potential advantages of such a system include reductions in inefficiency and unfair burdens placed on providers and patients, in reporting bias, and in administrative costs balanced against the risks of insurers excluding workers in high risk occupations from obtaining low cost health insurance and shifting away from employers the administrative burden for workers' compensation.     

Health for all in the Republic of Korea: one country's experience with implementing universal health care

Health care reforms in many countries face the twin challenges of providing universal coverage while controlling spiraling costs. Sixteen years ago the Republic of Korea had no national plan for health insurance, and only 8.8% of the population was covered. In 1975, health care accounted for 2.8% of GDP with government providing 12% of the finances. In 1977, Korea adopted a policy designed to achieve universal coverage while maintaining fee-for-service reimbursement. Korea incrementally established an employer based health care scheme by first mandating coverage for businesses, then government employees and teachers. Coverage was later extended to the poor, the self-employed, and residents of rural areas. Independent insurance societies manage each scheme, set premiums and co-payments, and are responsible for maintaining financial viability. By 1991, 30% of Korea's health care expenditures were from public funds, and health care costs had risen to 7.1% of GDP. Health care reform in Korea has been successful in achieving universal coverage, providing for a full range of services, and eliminating adverse selection. The system is financially solvent, costs are equitably distributed with the government providing subsidies when necessary, and small businesses have not been unduly burdened economically. Attempts to limit costs, however, have been unsuccessful. Patient demand for health care has remained surprisingly resistant to increasing co-payments. Providers have responded to lower physician and hospital fees by providing shorter, more frequent patient visits, relabeling services, and increasing hospital admissions. Competition between insurance societies has not materialized in a meaningful way to control costs.     

Why Rural Residents Migrate for Family Physician Care

Several studies have examined why rural residents bypass local hospitals, but few have explored why they migrate for physician care. In this study, data from a random mail survey of households in rural Iowa counties were used to determine how consumers' attitudes about their local health system, health beliefs, health insurance coverage and other personal characteristics influenced their selection of local vs. nonlocal family physicians (family physician refers to the family practice, internal medicine or other medical specialist providing an individual's primary care). Migration for family physician care was positively associated with a perceived shortage of local family physicians and use of nonlocal specialty physician care. Migration was negatively associated with a highly positive rating of the overall local health care system, living in town, Lutheran religious affiliation and private health insurance coverage. By understanding why rural residents prefer to bypass local physicians, rural health system managers, physicians and policy-makers should be better prepared to design innovative health organizations and programs that meet the needs of rural consumers.     

Impact of community health centers and Medicaid on the use of health services.

The impact of improved access to health care through the Federal community health center (CHC) and Medicaid programs was examined in five urban low-income areas. Data on access to care and physician, hospital, and dental services utilization were collected by baseline and followup health surveys in the CHCs'' services areas. There was a shift in use from hospital clinics to CHCs. Followup surveys indicated that 23 percent of the population reported CHCs as usual source of care. Travel time to source of care was reduced for users of CHCs. Medicaid coverage of the population in the survey areas increased from 16 to 37 percent between the baseline and followup surveys, an interval of 4 to 7 years. Increases occurred in the use of physicians and dental care between the baseline and followup surveys, but the rates scarcely kept pace with the national rates. Respondents who reported CHCs as their usual source of care, however, had a higher rate of physician visits and a lower rate of hospitalization compared with those using private physicians or hospital clinics as the usual source of care. Respondents with Medicaid coverage usually had higher physician and hospital use, irrespective of usual source of care. Both CHC and Medicaid programs contributed to increased use of dental care by providing financial and dental care resources. Although these two programs greatly facilitated the use of health services, disparity in physician and dental utilization remains between the five low-income areas and the averages for the nation.     

Mode of payment, practice characteristics, and physician support for patient self care

PURPOSE: The purpose of this study was to assess the influence of payment mode and practice characteristics on physicians' attitudes toward and support of self-care among their patients. It is a common practice for health plans and health insurance companies to distribute and make available various self-care services and products to members. These self-care products are generally part of a larger demand-management strategy. The adoption and dissemination of self-care products by both fee-for-service and capitated systems of care suggest an implicit assumption that there is no connection between physician payment mode and the support of self-care products by physicians for their patients. This study empirically examines this assumption. METHODS: Physicians from three Northwest communities were sampled and face-to-face interviews were conducted (N=448). RESULTS: The findings show that younger, primary care, and female physicians are more supportive of self care for their patients. Physicians with more income from capitation or salary are also more supportive of self care for their patients. After controlling for other factors, physician mode of payment is the only statistically significant predictor of support for self care. Research and policy implications are discussed. CONCLUSION: The findings suggest that physicians who are paid on a capitation basis have more motivation to have patients be less reliant on the formal care structure. It is unclear whether the payment mode generates this support, or if physicians supportive of patient self care self-select themselves into capitated systems of care.     

Private payers of health care in Brazil: characteristics, costs and coverage

The private sector is the predominant provider of health care in Brazil, particularly for inpatient services, and financing is a mix of public (through a prospective reimbursement system) and private. Roughly a quarter of the population has private insurance coverage, reflecting rapid growth in the past decade fuelled by the crisis in the public reimbursement system and the perceived deterioration of publicly provided care. Four major forms of insurance exist: (1) prepaid group practice; (2) medical cooperatives, physician owned and operated preferred provider organizations; (3) company health plans where employers ensure employee access to services under various types of arrangements from direct provision to purchasing of private services; and (4) health indemnity insurance. Each type of plan includes a wide variety of subplans from basic individual/family coverage to comprehensive executive coverage. The paper discusses the characteristics, costs and utilization patterns of all types of privately financed care, as well as the major problems associated with private financing: the limited package of benefits and low payout ceilings, inadequate consumer information and virtually no regulation.     

Substitution in a Medicaid mental health carve-out: services and costs

The objective is to empirically test the incentives associated with a Medicaid capitated mental health carve-out contract, whether outpatient services (less expensive, inside the contract) and residential treatment center care (costly care, outside of the contract) were substituted for inpatient psychiatric hospitalization used by children and adolescents. Data sources include Medicaid fee-for-service (FFS) claims for the non-capitated comparison sites and for residential treatment center use, and "shadow billing" encounter data for the experimental capitated managed care sites that provided public mental health services for children and adolescents with Medicaid insurance statewide in Colorado from September 1994 to June 1997. Two part least squares regression models are used to decompose services. Managed care sites are compared to sites that remained under FFS financing, before and in two post-periods after the carve-out. Principal findings show that children and adolescents who received mental health services from a capitated managed care provider were significantly less likely to receive inpatient care, and significantly more likely to receive residential treatment center care. In addition, insurance contract design contains financial incentives that affect the amount and mix of clinical care provided to clients by risk-bearing provider agencies. Findings provide evidence of cost substitution from inpatient care both inside the specialty system and outside the carve-out to other child-serving systems.     

The impact of health system membership on patient safety initiatives

BACKGROUND: Research in configurations and strategic groups has a rich history of revealing performance differences for hospitals and health care systems. PURPOSES: To assess the relationship between hospital-led health system configurations and the adoption of patient safety practices. In particular, the adoption of computerized physician order entry (CPOE) and intensive care unit physician staffing (IPS) is analyzed. METHODOLOGY: Analysis of variance was used to detect differences in patient safety measures based on health networks and systems' initial configuration clustering, and regression was used to assess group membership, controlling for hospital-level characteristics. The 2002 American Hospital Association survey and the first 3 years of the Leapfrog Group annual survey (2003-2005) are used for the analyses. RESULTS: There were significant differences in CPOE and IPS adoption and implementation levels based on health systems' configurations. Centralized physician/insurance health systems and moderately centralized health systems were the highest configurations in terms of CPOE adoption. Group membership was not positively related to the use of IPS relative to hospitals that are not classified using the taxonomy. In fact, there is a significant and negative adoption rate for both patient safety measures in facilities classified in the independent hospital systems category. CONCLUSION: There are systematic differences in the adoption of CPOE and IPS patient safety measures based on health system configurations. The configuration with an insurance company as part of its structure was more likely than other groups to be adopting CPOE. PRACTITIONER IMPLICATIONS: Given the durability of group membership, the Leapfrog Group and other patient safety initiatives could explicitly target configurations most likely to adopt and implement patient safety programs.     

Family structure, socioeconomic status, and access to health care for children

OBJECTIVE: To test the hypothesis that among children of lower socioeconomic status (SES), children of single mothers would have relatively worse access to care than children in two-parent families, but there would be no access difference by family structure among children in higher SES families. DATA SOURCES: The National Health Interview Surveys of 1993-95, including 63,054 children. STUDY DESIGN: Logistic regression was used to examine the relationship between the child's family structure (single-mother or two-parent family) and three measures of health care access and utilization: having no physician visits in the past year, having no usual source of health care, and having unmet health care needs. To examine how these relationships varied at different levels of SES, the models were stratified on maternal education level as the SES variable. The stratified models adjusted for maternal employment, child's health status, race and ethnicity, and child's age. Models were fit to examine the additional effects of health insurance coverage on the relationships between family structure, access to care, and SES. PRINCIPAL FINDINGS: Children of single mothers, compared with children living with two parents, were as likely to have had no physician visit in the past year; were slightly more likely to have no usual source of health care; and were more likely to have an unmet health care need. These relationships differed by mother's education. As expected, children of single mothers had similar access to care as children in two-parent families at high levels of maternal education, for the access measures of no physician visits in the past year and no usual source of care. However, at low levels of maternal education, children of single mothers appeared to have better access to care than children in two-parent families. Once health insurance was added to adjusted models, there was no significant socioeconomic variation in the relationships between family structure and physician visits or usual source of care, and there were no significant disparities by family structure at the highest levels of maternal education. There were no family structure differences in unmet needs at low maternal education, whereas children of single mothers had more unmet needs at high levels of maternal education, even after adjustment for insurance coverage. CONCLUSIONS: At high levels of maternal education, family structure did not influence physician visits or having a usual source of care, as expected. However, at low levels of maternal education, single mothers appeared to be better at accessing care for their children. Health insurance coverage explained some of the access differences by family structure. Medicaid is important for children of single mothers, but children in two-parent families whose mothers are less educated do not always have access to that resource. Public health insurance coverage is critical to ensure adequate health care access and utilization among children of less educated mothers, regardless of family structure.     

Benefit flexibility,cost shifting and mandated mental health coverage

This paper presents a policy analysis of options for making a state’s mandated mental health benefit more flexible while maintaining insurance premiums at a constant level. The analysis illustrates the difficult choices facing legislatures that attempt to balance improved coverage for mental health care with concerns about rising health care costs. A sophisticated simulation model is used to assess the costs of four alternative insurance benefit design options.     

Decline in physician referrals to health department clinics for immunizations: the role of vaccine financing

BACKGROUND: Physicians frequently refer children to health department clinics (HDCs) for immunizations because of high out-of-pocket costs to parents and poor reimbursement for providers. Referrals for immunizations can lead to scattered care. In 1994, two vaccine financing reforms began in New York State that reduced patient costs and improved provider reimbursement: the Vaccines for Children Program (VFC, mostly for those on Medicaid and uninsured) and a law requiring indemnity insurers to cover childhood immunizations and preventive services. OBJECTIVE: To measure reported changes in physician referrals to HDCs for immunizations before and after the vaccine financing reforms. DESIGN: In 1993, a self-administered survey measured immunization referral practices of primary care physicians. In 1997, we resurveyed respondents of the 1993 survey to evaluate changes in referrals. SETTING/ PARTICIPANTS: Three hundred twenty-eight eligible New York State primary care physicians (65% pediatricians and 35% family physicians) who responded to the 1997 follow-up immunization survey (response rate of 82%).Results: The proportion of physicians reporting that they referred some or all children out for immunizations decreased from 51% in 1993 to 18% in 1997 (p<0.001). In 1997, physicians were more likely to refer if they were family physicians (28% vs. 13%,p<0.01), or did not obtain VFC vaccines (29% vs. 13%,p<0.001). According to physicians who referred in 1993, decreased referrals in 1997 were due to the new insurance laws (noted by 61%), VFC (60%), Child Health Plus (a statewide insurance program for poor children, 28%), growth in commercial managed care (23%), Medicaid managed care (19%), and higher Medicaid reimbursement for immunizations that is due to VFC (18%). For physicians noting a decline in referrals, the magnitude of the decline was substantial-60% fewer referrals for VFC-eligible patients and 50% fewer for patients eligible under the new insurance law. CONCLUSIONS: Vaccine financing reforms decreased the proportion of physicians who referred children to HDCs for immunizations, and may have reduced scattering of pediatric care.     

Medical care use and selection in a social health insurance with an equalization fund: evidence from Colombia

This paper studies the relationship between health status and insurance participation, and between insurance status and medical use in the context of a social health insurance with an equalization fund (SHIEF). Under this system, revenues from a mandatory payroll tax are collected into a single pool (equalization fund) that reimburses for-profit insurance companies according to a capitated formula. Although competition should induce insurers to control costs without reducing the quality of service necessary to attract consumers, limitations in the capitation formula might induce insurers to select against bad risks, and limitations in the contribution system might induce more healthy individuals to evade enrollment. A three-equation model having social health insurance, private health insurance, and using medical services is estimated using a 1997 Colombian household survey. Consistent with similar studies, participation in SHIEF increases medical care use. On the other hand, the evidence on selection is somewhat mixed: individuals who report good health status are more likely to participate in SHIEF, while those without a chronic condition are less likely to participate in SHIEF.     

Substitution of physicians and other providers in outpatient mental health care

This paper evaluates the extent to which patients may substitute physician and non-physician outpatient mental health services in response to insurance coverage which differs by provider type. Using data from the National Medical Expenditure Survey, a semi-flexible two-stage demand specification is used to estimate substitution elasticities. Our results indicate that insurance coverage significantly affects the choice of provider from whom care is sought and, for individuals who seek care from both provider types, that physician and non-physician services are substitutes. Our elasticity estimates provide a welfare economic argument supporting coverage parity of physician and non-physician mental health services. © 1998 John Wiley & Sons, Ltd.     

Insurance + access not equal to health care: typology of barriers to health care access for low-income families

PURPOSE Public health insurance programs have expanded coverage for the poor, and family physicians provide essential services to these vulnerable populations. Despite these efforts, many Americans do not have access to basic medical care. This study was designed to identify barriers faced by low-income parents when accessing health care for their children and how insurance status affects their reporting of these barriers.     

Adult day centers: geriatric day health services in the community

In the past decade, more attention has been devoted to community-based health care services for the impaired elderly. The adult day services center is one of the newer approaches to this kind of care. Adult day centers show a wide variety of services, staff, and settings, and these centers serve elderly patients with a wide variety of disabilities. Some day programs provide physical and psychosocial rehabilitative services; others offer longer term maintenance and supervision, social stimulation, and respite care. Many centers offer some combination of these services. For the family physician, this variation provides a range of health care choices and treatment options aimed at improving function and avoiding unnecessary or premature institutionalization of the elderly patient.     

The impact of health insurance on outpatient utilization and expenditure: evidence from one middle-income country using national household survey data

Background

Achieving universal health insurance coverage by means of different types of insurance programs may be a pragmatic and feasible approach. However, the fragmentation of the health financing system may imply costs in terms of varying ability of the insurance programs to improve access to and reduce spending on care across different population groups. This study looks at the effect of different types of health insurance programs on the probability of utilizing care, the intensity of utilization, and individual spending on care in Jordan.

Methods

Using national household survey data collected in 2000 with a sub-sample of around 8,300 individuals, the study applies econometric techniques to a set of specified models along the two-part model approach to the demand for health care. By means of particular tests and other procedures, the robustness of the results is controlled.

Results

Around 60 percent of the population is covered by some type of insurance. However, the distribution varies across income groups, and importantly, the effect of insurance on the outcome indicators differ substantially across the various programs. Generally, insurance is found to increase the intensity of utilization and reduce out-of-pocket spending, while no general insurance effect on the probability of use is found. More specifically, however, these effects are only found for some programs and not for all. The best performing programs are those to which the somewhat better off groups have access.

Conclusion

Notwithstanding the empirical nature of the issues, the results point at the need to assess the effect of insurance coverage more profoundly than what is commonly done. Applying rigorous analysis to survey data in other settings will contribute to bringing out better evidence on what types of programs perform most effectively and equitably in different contexts.