Physician incentives and disclosure of payment methods to patients

OBJECTIVE: There is increasing public discussion of the value of disclosing how physicians are paid. However, little is known about patients' awareness of and interest in physician payment information or its potential impact on patients' evaluation of their care. DESIGN: Cross-sectional survey SETTING: Managed care and indemnity plans of a large, national health insurer. PARTICIPANTS: Telephone interviews were conducted with 2,086 adult patients in Atlanta, Ga; Baltimore, Md/Washington DC; and Orlando, Fla (response rate, 54%). MEASUREMENTS AND MAIN RESULTS: Patients were interviewed to assess perceptions of their physicians' payment method, preference for disclosure, and perceived effect of different financial incentives on quality of care. Non-managed fee-for-service patients (44%) were more likely to correctly identify how their physicians were paid than those with salaried (32%) or capitated (16%) physicians. Just over half (54%) wanted to be informed about their physicians' payment METHOD: Patients of capitated and salaried physicians were as likely to want disclosure as patients of fee-for-service physicians. College graduates were more likely to prefer disclosure than other patients. Many patients (76%) thought a bonus paid for ordering fewer than the average number of tests would adversely affect the quality of their care. About half of the patients (53%) thought a particular type of withhold would adversely affect the quality of their care. White patients, college graduates, and those who had higher incomes were more likely to think that these types of bonuses and withholds would have a negative impact on their care. Among patients who believed that these types of bonuses adversely affected care, those with non-managed fee-for-service insurance and college graduates were more willing to pay a higher deductible or co-payment in order to get tests that they thought were necessary. CONCLUSIONS: Most patients were unaware of how their physicians are paid, and only about half wanted to know. Most believed that bonuses or withholds designed to reduce the use of services would adversely affect the quality of their care. Lack of knowledge combined with strong attitudes about various financial incentives suggest that improved patient education could clarify patient understanding of the nature and rationale for different types of incentives. More public discussion of this important topic is warranted.