Paying For Primary Care: The Factors Associated With Physician Self-Selection Into Payment Models

In this paper we use a panel of administrative data to determine the factors associated with primary care physician self-selection into different payment models in Ontario, Canada. We find that primary care physicians will self-select into payment models based on existing practice and individual characteristics. These patterns of self-selection largely follow a utility maximizing model of physician behaviour; physicians with more complex patient populations are less likely to switch into capitation-based payment models where higher levels of effort are not financially rewarded. These findings have implications for future work that considers the impact of payment incentives on provider behaviour, and for governments introducing multiple payment models in a single healthcare sector.