Physician Payment Reform, a California Lesson?

September 15, 2009

Early in September 2009, The California HealthCare Foundation (CHCF) published their brief,  “Reforming Physician Payment: Lessons from California”, suggesting that the California delegated model of health care could be worthy of inclusion in the national debate on healthcare reform.  According to CHCF, three concepts founded in federal reform proposals share features with the delegated model: payment bundling, accountable care organizations and the medical home.  

CaduceusRather than reimbursing providers for quantity of care, the delegated model appears to encourage the best health outcomes and use resources more efficiently while reimbursing providers at uniform per capita rates.  These potential efficiencies are achieved through the capitation of medical groups for services provided to their assigned HMO membership.  The CHCF brief suggests the efficiencies exist, but the results of the study are inconclusive due to a lack of financial transparency at the group level.

Of course, California is uniquely served by hundreds of delegated medical groups.  …something which is not available in other parts of the nation.  With more than 20 years of experience with this model, California has also instituted stringent state regulation, pay for performance incentives (see IHA), and purchasing coalitions (see PBGH) that monitor their member satisfaction and quality of care.

If the resistance to change alone is so intense now, how much political resistance could be organized to capitation in the federal debate?

Reforming Physician Payment: Lessons from California (130K pdf)

The Evolution of Medical Groups and Capitation in California (186K pdf)


One Response to “Physician Payment Reform, a California Lesson?”

  1. J Smith said

    Great material. The Evolution study is new to me. Has there been follow up studies performed by the authors or others that you are aware. Any studies on these outside of California.

    Thank you for sharing.


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