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Does the way physicians are paid influence the way they practice? The case of Canadian family physicians' work activity

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  • Sarma, Sisira
  • Devlin, Rose Anne
  • Belhadji, Bachir
  • Thind, Amardeep

Abstract

Objectives To investigate the impact of the mode of remuneration on the work activities of Canadian family physicians on: (a) direct patient care in office/clinic, (b) direct patient care in other settings and (c) indirect patient care.Methods Because the mode of remuneration is potentially endogenous to the work activities undertaken by family physicians, an instrumental variable estimation procedure is considered. We also account for the fact that the determination of the allocation of time to different activities by physicians may be undertaken simultaneously. To this end, we estimate a system of work activity equations and allow for correlated errors.Results Our results show that the mode of remuneration has little effect on the total hours worked after accounting for the endogeneity of remuneration schemes; however it does affect the allocation of time to different activities. We find that physicians working in non-fee-for-service remuneration schemes spend fewer hours on direct patient care in the office/clinic, but devote more hours to direct patient care in other settings, and more hours on indirect patient care.Conclusions Canadian family physicians working in non-fee-for-service settings spend fewer hours on direct patient care in the office/clinic, but devote more hours to direct patient care in other settings and devote more hours to indirect patient care. The allocation of time in non-fee-for-service practices may have some implications for quality improvement.

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Bibliographic Info

Article provided by Elsevier in its journal Health Policy.

Volume (Year): 98 (2010)
Issue (Month): 2-3 (December)
Pages: 203-217

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Handle: RePEc:eee:hepoli:v:98:y:2010:i:2-3:p:203-217

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Web page: http://www.elsevier.com/locate/healthpol

Related research

Keywords: Physician remuneration Work activity Canadian family physician IV Method Joint model;

References

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  1. Jegers, Marc & Kesteloot, Katrien & De Graeve, Diana & Gilles, Willem, 2002. "A typology for provider payment systems in health care," Health Policy, Elsevier, vol. 60(3), pages 255-273, June.
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  5. Rizzo, John A. & Blumenthal, David, 1994. "Physician labor supply: Do income effects matter?," Journal of Health Economics, Elsevier, vol. 13(4), pages 433-453.
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  8. Sisira Sarma & Rose Anne Devlin & William Hogg, 2010. "Physician's production of primary care in Ontario, Canada," Health Economics, John Wiley & Sons, Ltd., vol. 19(1), pages 14-30.
  9. Brown, M C, 1989. "Empirical Determinants of Physician Incomes--Evidence from Canadian Data," Empirical Economics, Springer, vol. 14(4), pages 273-89.
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  12. Erik Magnus Sather, 2005. "Physicians' Labour Supply: The Wage Impact on Hours and Practice Combinations," LABOUR, CEIS, vol. 19(4), pages 673-703, December.
  13. Devlin, Rose Anne & Sarma, Sisira, 2008. "Do physician remuneration schemes matter? The case of Canadian family physicians," Journal of Health Economics, Elsevier, vol. 27(5), pages 1168-1181, September.
  14. Christopher F Baum & Mark E. Schaffer & Steven Stillman, 2007. "Enhanced routines for instrumental variables/generalized method of moments estimation and testing," Stata Journal, StataCorp LP, vol. 7(4), pages 465-506, December.
  15. Mitchell, Jean M. & Hadley, Jack, 1999. "Effects of managed care market penetration on physicians' labor supply decisions," The Quarterly Review of Economics and Finance, Elsevier, vol. 39(4), pages 491-511.
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Cited by:
  1. Di Matteo, Livio, 2014. "Physician numbers as a driver of provincial government health spending in Canadian health policy," Health Policy, Elsevier, vol. 115(1), pages 18-35.

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