Don’t blame doctors for capitation’s downfall

A study of the obvious: surgery rates increased when surgeons are paid on a fee-for-service basis.

But don’t blame the doctors for the current reimbursement system. It was the patients who revolted against the capitated model. I thought capitation was a perfectly reasonable approach to reign in health care costs.

Don’t hate the players, hate the game. (via Managed Care Matters)

Comments are moderated before they are published. Please read the comment policy.

  • Anonymous

    Why shouldn’t doctors have any blame? They bitch incessantly about the payment model, yet only a tiny percentage of them are willing to wean themselves from its tit.

    As long as the payees aren’t leaving, what impetus is there for change?

  • Kevin

    Let me ask – wean themselves off to . . . what? What other option is there other than FFS? Cash only? Going back to the rejected model of capitation? I’d like your suggestions.

    Physicians didn’t make the FFS rules, but are just making the best of a sorry situation.


  • Anonymous

    Yes, you can go cash only, like architects, lawyers, accountants, etc. You absolutely have that right. That right comes with significant risks, however, including the very real possibility of substantially less income.

    Doctors talk about the free market, and they complain about their current system and any proposed alternatives incessantly, but the truth is right now the majority of you are making an incredible living off the current system, and most aren’t willing to risk that.

    You tell us patients over and over that this system sucks, and that single payer sucks, so what else do you have left but cash? Yet there is nothing stopping you from doing it and you still don’t.

    Why is that?

  • Anonymous

    Kevin, what happens in a capitated system is also no surprise: PCP’s end up turfing a lot of junk to specialists. After all, why should you spend that extra time or see extra patients if you get exactly the same amount of money as the guy down the hall who doesn’t bother?

    Having said that, the current system of reimbursement is fostering this same behavior, but for different reasons – not the least of which is malpractice fear.

  • Anonymous

    So paying for work increases the amount of work provided. This should come as no surprise to anyone who works for a living.

    The authors of articles like this tend to assume that the amount of surgery under the capitated system is just right and anything more is too much. This glaring assumption needs to be proven, not merely accepted. Under which model (more or less surgery) are the patient’s actually better off. If it’s a toss up and the reimbursement sucks, then the capitated plan might tend to produce too little surgery.

    Just because there is a difference in surgical rates does not conclude which rate is the preferred.

  • Anonymous

    I can assure you that capitation does not decrease utilization. And almost all of the Medicare HMO’s capitate my speciality in this large city.

    The capitated herd tends to consist of patients who are corraled at Denny’s or the like into health plans promising all kinds of benefits at little or no additional cost. One version in my town allows access with no copay, even for specialists. This encourages your existing patients to defect if you participate in these plans as they perceive they can still see you but at a lower cost. These patients often are the sickest, with a high incidence of pathology (added to by the Grand Slam breakfast they eat while they are wooed by the HMO!). This type of solicitation would surely be deemed an illegal Medicare enticement if any physician engaged in similar tactics to attract traditional Medicare patients to his practice.

    HMO patients have very little, if any, choice of physician, especially subspecialists (hint: there is no reason to participate in capitated plans as a subspecialist; you can only lose). The patients are there to see you only because you are “on their plan”, not because they freely chose you. This is the worst reason I can imagine to chose to see me and I tell them that.

    If you are in a multi-physician group which bases pay on production, as I am, guess what happens? You treat the capitated patients just like anyone else. And that is how medical care should be. Sick patients require more visits, more surgery, and more tests. Any other method of compensation that punishes providers for providing needed care for needy patients is unethical. I am not an insurance company; but essentially you function as one when you accept a capitated contract.

    The trouble is that the pie is fixed, and it does not reimburse enough to care for these sick patients. And if have an overutilizing physician in your multi-physician practice it decreases the pie for the rest of your partners.

    Guess what happens next? Those partners drop out of the capitated plan like I have. The patients who want to see me for the right reason, i.e. by choice rather than coercion, may do so by switching to another plan or by paying out-of-pocket. And that is the American way.

Most Popular