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Quality and quantity in primary care mixed-payment models: evidence from family health organizations in Ontario


  • Boris Kralj
  • Jasmin Kantarevic


We study the impact of a mixed capitation model (the Family Health Organization, FHO) on quality and quantity outcomes among primary care physicians in Ontario. Using a panel of administrative data covering one year before and two years after the FHO model was introduced, we find that physicians in the FHO model provide about 6% to 7% fewer services and visits per day, but are between 7% and 11% more likely to achieve preventive care quality targets. These results suggest that the mixed capitation model with contractible quality indicators may be welfare improving relative to the FFS model.

Suggested Citation

  • Boris Kralj & Jasmin Kantarevic, 2013. "Quality and quantity in primary care mixed-payment models: evidence from family health organizations in Ontario," Canadian Journal of Economics, Canadian Economics Association, vol. 46(1), pages 208-238, February.
  • Handle: RePEc:cje:issued:v:46:y:2013:i:1:p:208-238

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    References listed on IDEAS

    1. Chalkley, Martin & Malcomson, James M., 1998. "Contracting for health services when patient demand does not reflect quality," Journal of Health Economics, Elsevier, vol. 17(1), pages 1-19, January.
    2. Blomqvist, Ake & Leger, Pierre Thomas, 2005. "Information asymmetry, insurance, and the decision to hospitalize," Journal of Health Economics, Elsevier, vol. 24(4), pages 775-793, July.
    3. Dumont, Etienne & Fortin, Bernard & Jacquemet, Nicolas & Shearer, Bruce, 2008. "Physicians' multitasking and incentives: Empirical evidence from a natural experiment," Journal of Health Economics, Elsevier, vol. 27(6), pages 1436-1450, December.
    4. Eggleston, Karen, 2005. "Multitasking and mixed systems for provider payment," Journal of Health Economics, Elsevier, vol. 24(1), pages 211-223, January.
    5. Rajeev H. Dehejia & Sadek Wahba, 2002. "Propensity Score-Matching Methods For Nonexperimental Causal Studies," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 151-161, February.
    6. Ma, Ching-to Albert & McGuire, Thomas G, 1997. "Optimal Health Insurance and Provider Payment," American Economic Review, American Economic Association, vol. 87(4), pages 685-704, September.
    7. Fortin, Bernard & Jacquemet, Nicolas & Shearer, Bruce, 2010. "Labour Supply, Work Effort and Contract Choice: Theory and Evidence on Physicians," CLSSRN working papers clsrn_admin-2010-30, Vancouver School of Economics, revised 21 Oct 2010.
    8. Edwin Leuven & Barbara Sianesi, 2003. "PSMATCH2: Stata module to perform full Mahalanobis and propensity score matching, common support graphing, and covariate imbalance testing," Statistical Software Components S432001, Boston College Department of Economics, revised 01 Feb 2018.
    9. Yip, Winnie C., 1998. "Physician response to Medicare fee reductions: changes in the volume of coronary artery bypass graft (CABG) surgeries in the Medicare and private sectors," Journal of Health Economics, Elsevier, vol. 17(6), pages 675-699, December.
    10. Ellis, Randall P., 1998. "Creaming, skimping and dumping: provider competition on the intensive and extensive margins1," Journal of Health Economics, Elsevier, vol. 17(5), pages 537-555, October.
    11. Kantarevic, Jasmin & Kralj, Boris & Weinkauf, Darrel, 2011. "Enhanced fee-for-service model and physician productivity: Evidence from Family Health Groups in Ontario," Journal of Health Economics, Elsevier, vol. 30(1), pages 99-111, January.
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    Cited by:

    1. Rudoler, David & Laporte, Audrey & Barnsley, Janet & Glazier, Richard H. & Deber, Raisa B., 2015. "Paying for primary care: A cross-sectional analysis of cost and morbidity distributions across primary care payment models in Ontario Canada," Social Science & Medicine, Elsevier, vol. 124(C), pages 18-28.
    2. David Gray & William Hogg & Michael E. Green & Yan Zhang, 2015. "Did Family Physicians Who Opted into a New Payment Model Receive an Offer They Should Not Refuse? Experimental Evidence from Ontario," Canadian Public Policy, University of Toronto Press, vol. 41(2), pages 151-165, June.
    3. Kantarevic, Jasmin & Kralj, Boris, 2014. "Risk selection and cost shifting in a prospective physician payment system: Evidence from Ontario," Health Policy, Elsevier, vol. 115(2), pages 249-257.
    4. Kantarevic, Jasmin & Kralj, Boris, 2015. "Physician Payment Contracts in the Presence of Moral Hazard and Adverse Selection: The Theory and its Application to Ontario," IZA Discussion Papers 9142, Institute for the Study of Labor (IZA).
    5. repec:eee:jhecon:v:55:y:2017:i:c:p:76-94 is not listed on IDEAS
    6. Brosig-Koch, Jeannette & Hennig-Schmidt, Heike & Kairies-Schwarz, Nadja & Wiesen, Daniel, 2015. "The Effects of Introducing Mixed Payment Systems for Physicians – Experimental Evidence," Ruhr Economic Papers 543, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    7. Logan McLeod, Jeffrey A. Johnson, 2014. "Changing the Schedule of Medical Benefits and the Effect on Primary Care Physician Billing: Quasi-Experimental Evidence from Alberta," LCERPA Working Papers 0077, Laurier Centre for Economic Research and Policy Analysis, revised 28 Aug 2014.
    8. David Rudoler & Raisa Deber & Janet Barnsley & Richard H. Glazier & Adrian Rohit Dass & Audrey Laporte, 2015. "Paying for Primary Care: The Factors Associated with Physician Self‐selection into Payment Models," Health Economics, John Wiley & Sons, Ltd., vol. 24(9), pages 1229-1242, September.
    9. repec:zbw:rwirep:0543 is not listed on IDEAS
    10. Jeannette Brosig-Koch & Heike Hennig-Schmidt & Nadja Kairies-Schwarz & Daniel Wiesen, 2015. "The Effects of Introducing Mixed Payment Systems for Physicians – Experimental Evidence," Ruhr Economic Papers 0543, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    11. Ake Blomqvist & Boris Kralj & Jasmin Kantarevic, 2013. "Accountability and Access to Medical Care: Lessons from the Use of Capitation Payments in Ontario," e-briefs 168, C.D. Howe Institute.

    More about this item

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health


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