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PubMed1998

A comparison of capitated and fee-for-service Medicaid reimbursement methods on pregnancy outcomes.

OBJECTIVE: To determine if the payment method influenced the likelihood of selected obstetrical process measures and pregnancy outcome indicators among Medicaid women. DATA SOURCE/STUDY SETTING: Data from the live birth certificates computer file for 1993 from the State of California. The computer files contain information about the demographic characteristics of the mother, her medical conditions prior to delivery, medical problems during labor and delivery, delivery method, newborn and maternal outcomes, and expected principal source of payment for prenatal care and for hospital delivery. STUDY DESIGN: The study sample consisted of singleton live births to women in the California Medi-Cal program residing in one of two counties in which a mixed-model managed care plan was the method of reimbursement or in one of three counties in which fee-for-service was the payment method. The study and control counties were matched in terms of geographic proximity and sociodemographics. PRINCIPAL FINDINGS: Among Medi-Cal women, the likelihood of low birth weight (LBW) was lower in the capitated payment group than in the fee-for-service payment group even when controlling for maternal and newborn characteristics and adequacy of prenatal care. There was no difference in either the adequacy of prenatal care, the cesarean birth rate, or the likelihood of adverse pregnancy outcomes other than LBW between the two payer groups. CONCLUSIONS: Results of this "natural experiment" suggest that enrollment of pregnant Medi-Cal beneficiaries in capitated healthcare services through a primary care case management system in a county-organized health system/health insuring organization can have a beneficial effect on low birth weight and provide care comparable to a fee-for-service system.

Adolescent↗
PubMed2004

Self-reported oral health of enrollees in capitated and fee-for-service dental benefit plans.

BACKGROUND: This article examines the impact of different dental plan types, dental markets, premiums, out-of-pocket costs and enrollee demographics on the enrollees' perceived oral health status. METHODS: The authors randomly sampled enrollees in dental benefit plans offered by eight Fortune 500 companies and interviewed them regarding their experiences with their plans, including perceived oral health status. The sample consisted of 2,340 respondents, of whom 42.3 percent were enrolled in capitation, or CAP, plans, and 57.7 percent were enrolled in fee-for-service, or FFS, plans. RESULTS: The authors used chi2 tests, analysis of variance and multinomial logistic regression. They set significance at P < .05. Results indicate that nonwhites, CAP-plan enrollees and those with higher out-of-pocket cost were less likely to rate their oral health "good," "very good" or "excellent" compared with whites, FFS-plan enrollees and those with lower out-of-pocket costs, respectively. CONCLUSIONS: CAP-plan enrollees rated their oral health more poorly than did FFS-plan enrollees. Further studies are necessary to determine if adverse selection occurs and if CAP plans provide inferior quality of care. PRACTICE IMPLICATIONS: Practitioners' awareness of and willingness to address the variety of factors that influence perceived oral health status may improve their patients' perceived oral health status and satisfaction with care.

Analysis of Variance↗
PubMed1996

Effect of conversion from a fee-for-service plan to a capitation reimbursement system on a circumscribed outpatient radiology practice of 20,000 persons.

PURPOSE: To assess the effect of a capitation reimbursement plan with attendant changes in service arrangements on the utilization of radiologic services, financially on the payer, and on the satisfaction of patients and referring physicians. MATERIALS AND METHODS: Outpatient radiologic services for a defined population of 20,000 company employees and their dependents were converted from a point-of-service managed care plan to a capitation payment plan. Under the capitation plan, nonemergent outpatient diagnostic imaging was performed at a newly constructed imaging center staffed by general radiologists. All cross-sectional images and certain projectional studies were also over-read (read again after the initial reading by local radiologists) by subspecialists. Utilization data obtained before and after the conversion were analyzed. The financial effect on the employer and the satisfaction of patients and physicians were also assessed. RESULTS: Quality imaging services were provided under the capitation plan with financial savings by the employer. Use was higher for cross-sectional imaging, especially magnetic resonance imaging studies, and was lower for nonmammographic plain radiography. Consumer satisfaction was high. CONCLUSION: Under certain conditions, conversion to a capitation system for imaging can lead to improved quality of care and decreased overall health-care costs.

Ambulatory Care↗
PubMedDate not supplied

Using cost accounting in a medical group practice. An application using the resource-based relative value scale.

With the presence of managed care increasing in our health care environment, today's practice administrator needs a method to determine whether the negotiated fee schedule, capitation rate, etc., is adequate. The only true method to make this determination is to undertake a cost study of physician activity. However, this approach could be tedious, cumbersome and beyond the resources of the practice. The author demonstrates a method to approximate the cost of a physician's activity by identifying the cost of a relative value. The relative value scale used is the resource-based relative value scale (RBRVS). The article also proposes other applications: comparative analysis, allocation of capitation payments and fee schedule development.

Accounting↗
PubMed2002

Alcohol and juvenile justice contacts: a comparison of fee-for-service and capitated medicaid mental health services.

OBJECTIVE: This study examines whether youth with alcohol problems are especially vulnerable to juvenile justice contact when receiving public mental health services in fee-for-service versus capitated managed-care agencies. Capitation is a payment method often accompanying managed care; a fixed fee is paid per person enrolled, for a specific time period and range of services. METHOD: Youth services were studied in a statewide, quasi-experimental design from July 1994 to June 1997; subjects were 13,365 Medicaid-eligible youth (52% female) aged 10-17. Alcohol problems were measured using a clinician-generated psychiatric diagnosis and a subjective indicator of alcohol symptoms obtained from a psychometrically tested mental health treatment intake form. Analysis methods were hazard/survival rates, log-rank tests and Cox proportional hazards models. RESULTS: As measured by the presence of symptoms, alcohol-involved youth in capitated managed care were significantly less likely to have contact with the juvenile justice system, in uncontrolled analysis. In controlled analysis, they were also less likely; however, only at the level of a trend. CONCLUSIONS: Concerns regarding capitated managed mental health care (e.g., substitution of care or "cost-shifting") found no support. There was no evidence of a shifting of alcohol-involved youth receiving mental health services under capitated managed care to the juvenile justice system. If anything, such youth saw their likelihood of juvenile justice involvement decrease.

Adolescent↗
PubMed2000

Health care utilization by old-old long-term care facility residents: how do Medicare fee-for-service and capitation rates compare?

OBJECTIVE: To describe the healthcare utilization of a long-term care population receiving primary and specialty care in a closed system and to compare Medicare fee-for-service (FFS) reimbursement with the amount that would have been paid under capitation for these services. SETTING: A life care community in California composed of two facilities, both having residential care and nursing facility (NF) beds. PARTICIPANTS: Residents (n = 700) living in the community between September 1995 and February 1996. METHODS: Data on Medicare Part A and Part B reimbursements were gathered from billing records for hospitalizations, based on diagnostic related group payments, primary and specialty care visits, various procedures, diagnostic tests, and therapeutic services. These data were compared with what the facility, in collaboration with the providers and an affiliated hospital, would have received under Medicare capitated rates at that time. RESULTS: Annually, residents averaged 16.3 primary care visits, 7.7 specialist visits, and 3453 hospital days per thousand. Nursing facility residents received significantly more primary care than did those in residential care. Total Medicare Part A and B payments per resident per month averaged $558. The monthly capitation rate in effect at the time for this population was substantially higher at $1085, generating an annual "risk pool" of $9.1 million. Care provided in the two facilities varied greatly. Hospitalization rates, clinic-based primary care and specialist visits, and therapy sessions were greater in facility one. Overall expenditures were lower for residents at facility two, where the majority of care was provided by trained geriatricians in collaboration with physician extenders and without sophisticated clinical pathways and utilization controls. CONCLUSIONS: Our data support other studies that suggest that teams of geriatricians and physician extenders can reduce hospitalization rates and overall expenditures. Capitated rates for the frail, geriatric population warrant careful study. These rates must balance fiscal responsibility with the need for adequate, risk-adjusted payments that create incentives for providers to produce high quality as well as cost-effective care.

Aged↗
PubMedDate not supplied

Creating a sustainable physician compensation plan. Serving both fee-for-service and capitated populations.

A large, integrated health system in St. Louis acquired a primary care, health maintenance organization staff model group practice with 55 physicians. Health system leadership positioned the acquired physician group to diversify and expand its fee-for-service patient base to increase revenue and support the expansive fixed cost structure of the health centers. With interim managers, the leaders developed a new physician compensation plan that put a greater portion of the physicians' compensation at risk and provided incentives for enhanced productivity in both the capitated and fee-for-service lines of business. This article explores the key characteristics, benefits and potential areas for improvement associated with the new incentive compensation model and describes the centers' improved operating performance and gains in physician productivity.

Capitation Fee↗
PubMed2002

Two-year outcomes of fee-for-service and capitated medicaid programs for people with severe mental illness.

OBJECTIVE: To examine the effects of two models of capitation on the clinical outcomes of Medicaid beneficiaries in the state of Colorado. DATA SOURCE: A large sample of adult, Medicaid beneficiaries with severe mental illness drawn from regions where capitation contracts were (1) awarded to local community mental health agencies (direct capitation), (2) awarded to a joint venture between local community mental health agencies and a large, private managed behavioral health organization, and (3) not awarded and care continued to be reimbursed on a fee-for-service basis. STUDY DESIGN: The three samples were compared on treatment outcomes assessed over 2 years (total n = 591). DATA COLLECTION METHODS: Study participants were interviewed by trained, clinical interviewers using a standardized protocol consisting of the GAF, BPRS, QOLI, and CAGE. PRINCIPAL FINDINGS: Outcomes were comparable across most outcome measures. When outcome diffrences were evident, they tended to favor the capitation samples. CONCLUSIONS: Medicaid capitation in Colorado does not appear to have negatively affected the outcomes of people with severe mental illness during the first 2 years of the program. Furthermore, the type of capitation model was unrelated to outcomes in this study.

Adolescent↗
PubMed1992

Physician responses to fee-for-service and capitation payment.

The ability to achieve reductions in health care costs is determined in part by physician payment mechanisms. This study observes the response to a change in the reimbursement mechanism by a group of physicians who participated in a fee-for-service plan and then formed an IPA using capitation payment for primary care physicians and a reduced fee schedule for specialists. Patient benefits were similar under the two plans. Analyses of data for a group of continuous enrollees show that the change in the physician payment mechanism was associated with a reduction in hospitalizations but increases in length of hospital stay and number of ambulatory visits. These increases may have occurred because capitation for primary care physicians and a reduced fee schedule for specialists led to a greater number of referrals with no incentive in place for reductions in length of stay for specialty admissions.

Ambulatory Care↗
PubMed2001

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.

Attitude of Health Personnel↗