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Managed care and organized systems of care are restructuring the delivery of care in the United States. As care is reorganized, physician practice styles, autonomy, and compensation are undergoing profound changes. To successfully integrate physicians into the new managed systems of care, their organizational relationship to and their compensation within these systems must be carefully considered. This paper first explores physician motivation as it is related to compensation. The paper then describes a variety of emerging organizational designs aimed at aligning the interests of physicians and hospitals. The author considers fully integrated, physician-hospital organizations with target income compensation arrangements to be most suitable to the collective success of professionals and organized systems of care. The paper concludes with a discussion of the many dilemmas and challenges posed by the intertwining of managed care, organized networks of care, and professional compensation. [ABSTRACT FROM AUTHOR]

Increasing attention has been paid in recent years to the problem of “too much medicine”, whereby patients receive unnecessary investigations and treatments providing them with little or no benefit, but which expose them to risks of harm. Despite this phenomenon potentially constituting an inefficient use of health care resources, it has received limited direct attention from health economists. This paper considers “too much medicine” as a form of overconsumption, drawing on research from health economics, behavioural economics and ecological economics to identify possible explanations for and drivers of overconsumption. We define overconsumption of health care as a situation in which individuals consume in a way that undermines their own well-being. Extensive health economics research since the 1960s has provided clear evidence that physicians do not act as perfect agents for patients, and there are perverse incentives for them to provide unnecessary services under various circumstances. There is strong evidence of the existence of supplier-induced demand, and of the impact of various forms of financial incentives on clinical practice. The behavioural economics evidence provides rich insights on why clinical practice may depart from an “evidence-based” approach. Moreover, behavioural findings on health professionals’ strategies for dealing with uncertainty, and for avoiding potential regret, provide powerful explanations of why overuse and overtreatment may frequently appear to be the “rational” choice in clinical decision-making, even when they cause harm. The ecological economics literature suggests that status or positional competition can, via the principal-agent relationship in health care, provide a further force driving overconsumption. This novel synthesis of economic perspectives suggests important scope for interdisciplinary collaboration; signals potentially important issues for health technology assessment and health technology management policies; and suggests that cultural change might be required to achieve significant shifts in clinical behaviour. [ABSTRACT FROM AUTHOR]

This paper examines the right to health care. Various expressions of this right may be distinguished. These include both individual rights and social rights which could be based upon international treaties and constitutional rights. They may be found in national health legislation and, in some cases, in jurisprudence. To analyze the consequences of limiting the right to health care, a framework for judicial review has been developed which encompasses these expressions of the right to health care. The framework was used to examine legal and health policy developments in three Western and two Eastern European countries. In Italy and the Netherlands the right to health care is protected constitutionally (but on differing legal bases) while the United Kingdom does not have a written constitution. In contrast, Hungary and Poland have for many years seen the state take responsible for the provision, administration and allocation of health care services and the right to health care was guaranteed theoretically but not in practice because of the lack of (financial) means. However, the Polish Constitution explicitly anticipates possible limitations of the right to health care. What all these countries have in common is a cost containment perspective where the future will bring even tighter limits on what resources patients may consume. Despite differences in legal structure between these countries, where they seem to converge is on the consequences of putting limitations on the right to health care. The courts in Italy, the Netherlands and the UK have formulated conditions drawn from the acceptance that this right has to be judged within the context of limited resources. It may be concluded that finding a compromise between the right to health care and cost containment policies could also be an issue, Eastern European countries will have to face in the future. [ABSTRACT FROM AUTHOR]

Background: Outpatients receive observation services to determine the need for inpatient admission. These services are usually provided without the use of condition‐specific protocols and in an unstructured manner, scattered throughout a hospital in areas typically designated for inpatient care. Emergency department observation units (EDOUs) use protocolized care to offer an efficient alternative with shorter lengths of stay, lower costs, and higher patient satisfaction. EDOU growth is limited by existing policy barriers that prevent a "two‐service" model of separate professional billing for both emergency and observation services. The majority of EDOUs use the "one‐service" model, where a single composite professional fee is billed for both emergency and observation services. The financial implications of these models are not well understood. Methods: We created a Monte Carlo simulation by building a model that reflects current clinical practice in the United States and uses inputs gathered from the most recently available peer‐reviewed literature, national survey, and payer data. Using this simulation, we modeled annual staffing costs and payments for professional services under two common models of care in an EDOU. We also modeled cash flows over a continuous range of daily EDOU patient encounters to illustrate the dynamic relationship between costs and revenue over various staffing levels. Results: We estimate the mean (±SD) annual net cash flow to be a net loss of $315,382 (±$89,635) in the one‐service model and a net profit of $37,569 (±$359,583) in the two‐service model. The two‐service model is financially sustainable at daily billable encounters above 20, while in the one‐service model, costs exceed revenue regardless of encounter count. Physician cost per hour and daily patient encounters had the most significant impact on model estimates. Conclusions: In the one‐service model, EDOU staffing costs exceed payments at all levels of patient encounters, making a hospital subsidy necessary to create a financially sustainable practice. Professional groups seeking to staff and bill for both emergency and observation services are seldom able to do so due to EDOU size limitations and the regulatory hurdles that require setting up a separate professional group for each service. Policymakers and health care leaders should encourage universal adoption of EDOUs by removing restrictions and allowing the two‐service model to be the standard billing option. These findings may inform planning and policy regarding observation services. [ABSTRACT FROM AUTHOR]

During the 1980s and 1990s, innovations in the organization, funding, and delivery of primary health care in Canada were at the periphery of the system rather than at its core. In the early 2000s, a new policy environment emerged. This policy analysis examines primary health care reform efforts in Canada during the last decade, drawing on descriptive information from published and gray literature and from a series of semistructured interviews with informed observers of primary health care in Canada. Primary health care in Canada has entered a period of potentially transformative change. Key initiatives include support for interprofessional primary health care teams, group practices and networks, patient enrollment with a primary care provider, financial incentives and blended-payment schemes, development of primary health care governance mechanisms, expansion of the primary health care provider pool, implementation of electronic medical records, and quality improvement training and support. Canada's experience suggests that primary health care transformation can be achieved voluntarily in a pluralistic system of private health care delivery, given strong government and professional leadership working in concert. [ABSTRACT FROM AUTHOR]