Can Design of Capitation-Based Payment Systems Affect Physicians’ Prioritisation of High-Need Patients?
HERO-seminar med Anne Sophie Oxholm, University of Southern Denmark, Department of Business and Economics, COHERE.
Many health care systems use provider payment as an instrument to ensure an efficient and equitable delivery of health care services. However, as there exists only a limited amount of suited natural experiments and it is difficult to retrieve data on patients’ needs, little is known about how provider payments affect treatment patterns. We therefore use a fully incentivised, controlled laboratory experiment to test how different capitation-based remuneration schemes affect provision of health care amongst patients with different needs for health care services. In our experiment, physicians choose quantities of health care services for patients with different gains from treatment. We test three different types of capitation systems: Capitation without a financial incentive (“employed physician”), capitation with a financial incentive (“self-employed physician”), and risk-adjusted capitation. Preliminary results reveal that when physicians face a trade-off between own income and patients’ health gain, they on average decrease the amount of health care services given to patients. The high-need patients tend to experience the greatest loss of care. We find that risk-adjusting capitation based on patients’ need of health care affects physicians’ prioritisation of patients over and above the financial effect. On average we find that risk-adjustment (holding total payment constant) leads physicians to supply a higher (lower) share of their services to high (low)-payment patients.