1. How Plans Influence Physician Practice Patterns

2. Plan for Today How Plans Influence Practice Patterns Team Meeting

3. (Framework )

4. Influencing Practice Patterns Selective contracting Use of gatekeepers Financial incentives Utilization review Profiling Clinical guidelines or protocols

5. The Goals: Reduce unexplained variation in treatment patterns Improve quality –Underuse, overuse, misuse Lower costs

6. What Do Managed Care Plans Do to Affect Care? Remler et al. Inquiry 34(3): Fall 1997

7. Financial Incentives Capitation Risk/bonus pools for referrals and hospital Penalties/bonuses for achieving performance measures –Immunization rates –Mammography rates –Patient satisfaction –Productivity

8. Average share of physicians’ patients who are covered under different financial arrangements (1995)

9. Primary care physicians in managed care in California (1996) Financial incentives –Use of referrals (14%) –Use of hospital (19%) –Patient satisfaction (21%) –Productivity (18%) Median earnings from bonus = 7% of net practice income Grumbach et al. “Primary Care Physicians’ Experience of Financial Incentives in Managed Care Systems,” JAMA 339(21):1516-1521, November, 19, 1998.

10. Primary care physicians in California (1996) 58% of physicians with bonuses based individual and group performance 15% of physicians with bonuses based on individual performance only Grumbach et al. “Primary Care Physicians’ Experience of Financial Incentives in Managed Care Systems,” JAMA 339(21):1516-1521, November, 19, 1998.

11. Utilization Review “What percentage of the patients you see have health plans that review: –Your clinical decisions about the appropriate site of care, including inpatient, outpatient and emergency room care? –The content of your diagnosis or treatment decisions to assess appropriateness? –The length of hospital stays of your patients?” Remler et al.

12. Average share of physicians’ patients who are subject to managed care techniques (1995)

13. Utilization review denials: Percent of patients for whom recommended care denied coverage

14. “For what percentage of all the patients you see Are you provided with profiles of your clinical activity to identify outliers in the use of services, diagnoses, and/or treatments? Are there condition-specific protocols or guidelines for physicians to use in making diagnoses or prescribing treatments?” Remler et al.

15. Average share of physicians’ patients who are subject to managed care techniques (1995)

16. Physician profiles

17. Issues in Profiling Sufficient patient volume –So that differences not just due to random variation Case-mix differences Information system requirements

18. Physician Adherence to Protocols Perceived legitimacy –Expert consensus –Based on scientific evidence –Involvement of local physicians Perceived purpose –Quality –Cost

19. Physician Adherence to Protocols (cont.) General dissemination not effective –Announcements –Conferences Requires active strategies, in combination –Participative workshops –Outreach visits (academic detailing) –Patient involvement –Reminders or audit with feedback

20. HMO Market Structure and Performance: 1985-1995 Wholey, Christianson, Engberg and Bryce Health Affairs 16(6): Nov/Dec 1997

21. Hospital Days and Ambulatory Visits for Non-Medicare Enrollees