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Enhanced fee-for-service model and physician productivity: Evidence from Family Health Groups in Ontario

  • Kantarevic, Jasmin
  • Kralj, Boris
  • Weinkauf, Darrel

We study an enhanced fee-for-service model for primary care physicians in the Family Health Groups (FHG) in Ontario, Canada. In contrast to the traditional fee-for-service (FFS) model, the FHG model includes targeted fee increases, extended hours, performance-based initiatives, and patient enrolment. Using a long panel of claims data, we find that the FHG model significantly increases physician productivity relative to the FFS model, as measured by the number of services, patient visits, and distinct patients seen. We also find that the FHG physicians have lower referral rates and treat slightly more complex patients than the comparable FFS physicians. These results suggest that the FHG model offers a promising alternative to the FFS model for increasing physician productivity.

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Article provided by Elsevier in its journal Journal of Health Economics.

Volume (Year): 30 (2011)
Issue (Month): 1 (January)
Pages: 99-111

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Handle: RePEc:eee:jhecon:v:30:y:2011:i:1:p:99-111
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505560

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  1. McGuire, Thomas G. & Pauly, Mark V., 1991. "Physician response to fee changes with multiple payers," Journal of Health Economics, Elsevier, vol. 10(4), pages 385-410.
  2. 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.
  3. Thomas F. Crossley & Jeremiah Hurley & Sung-Hee Jeon, 2007. "Physician Labour Supply in Canada: a Cohort Analysis," Centre for Health Economics and Policy Analysis Working Paper Series 2006-04, Centre for Health Economics and Policy Analysis (CHEPA), McMaster University, Hamilton, Canada.
  4. Thomas G. McGuire & Mark V. Pauly, 1991. "Physician Response to Fee Changes with Multiple Payers," Papers 0015, Boston University - Industry Studies Programme.
  5. Jinhu Li & Jeremiah Hurley & Philip DeCicca & Gioia Buckley, 2011. "Physician Response to Pay-for-Performance: Evidence from a Natural Experiment," NBER Working Papers 16909, National Bureau of Economic Research, Inc.
  6. Jeffrey M. Wooldridge, 2005. "Fixed-Effects and Related Estimators for Correlated Random-Coefficient and Treatment-Effect Panel Data Models," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 385-390, May.
  7. Matt Sutton & Ross Elder & Bruce Guthrie & Graham Watt, 2010. "Record rewards: the effects of targeted quality incentives on the recording of risk factors by primary care providers," Health Economics, John Wiley & Sons, Ltd., vol. 19(1), pages 1-13.
  8. 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.
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