Use a system where general practice is capitatied by the specialists work on a fee-for-service basis paid out of the primary physician’s budget

Current Payment Methods: Incentives to do too much or too little

Reducing fees leads to a vicious cycle of increase utilization and further reduced fees

Caps just encourage physicians to get as much as quickly as they can

Capitation does not encourage anything more than the bare minimum and no preventetive care

Primary Care Physician Reimbursement

Suggests a low proportion of fee-for-service with a standard capitation to provide incentives for quality care and preventetive care but not for excess care

Specialist Reimbursement

Micromanagement not effective and very costly

Putting the risk on physicians is a conflict of interest

HMOs simply shift the administrative burden

Suggestion: put specialists on a simmilar low percentage fee-for-service and capitation plan

Suggestion: have the specialists paid fee-for-service out of the primary phsyicians fund--if they go over then start reviewing or limiting their referals

One Payer or Many?

Easier to do with one payer

Won’t work if others don’t do it