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Objective To examine system integration with physician specialties across markets and the association between local system characteristics and their patterns of physician integration. Data sources Data come from the AHRQ Compendium of US Health Systems and IQVIA OneKey database. Study design We examined the change from 2016 to 2018 in the percentage of physicians in systems, focusing on primary care and the 10 most numerous nonhospital-based specialties across the 382 metropolitan statistical areas (MSAs) in the US. We also categorized systems by ownership, mission, and payment program participation and examined how those characteristics were related to their patterns of physician integration in 2018. Data collection/extraction methods We examined local healthcare markets (MSAs) and the hospitals and physicians that are part of integrated systems that operate in these markets. We characterized markets by hospital and insurer concentration and systems by type of ownership and by whether they have an academic medical center (AMC), a 340B hospital, or accountable care organization. Principal findings Between 2016 and 2018, system participation increased for primary care and the 10 other physician specialties we examined. In 2018, physicians in specialties associated with lucrative hospital services were the most commonly integrated with systems including hematology-oncology (57%), cardiology (55%), and general surgery (44%); however, rates varied substantially across markets. For most specialties, high market concentration by insurers and hospital-systems was associated with lower rates of physician integration. In addition, systems with AMCs and publicly owned systems more commonly affiliated with specialties unrelated to the physicians' potential contribution to hospital revenue, and investor-owned systems demonstrated more limited physician integration. Conclusions Variation in physician integration across markets and system characteristics reflects physician and systems' motivations. These integration strategies are associated with the financial interests of systems and other strategic goals (eg, medical education, and serving low-income populations).

Objective We aim to assess whether system providers perform better than nonsystem providers under an alternative payment model that incentivizes high-quality, cost-efficient care. We posit that the payment environment and the incentives it provides can affect the relative performance of vertically integrated health systems. To examine this potential influence, we compare system and nonsystem hospitals participating in Medicare's Comprehensive Care for Joint Replacement (CJR) model. Data sources We used hospital cost and quality data from the Centers for Medicare & Medicaid Services linked to data from the Agency for Healthcare Research and Quality's Compendium of US Health Systems and hospital characteristics from secondary sources. The data include 706 hospitals in 67 metropolitan areas. Study design We estimated regressions that compared system and nonsystem hospitals' 2017 cost and quality performance providing lower joint replacements among hospitals required to participate in CJR. Principal findings Among CJR hospitals, system hospitals that provided comprehensive services in their local market had 5.8 percent ($1612) lower episode costs (P = .01) than nonsystem hospitals. System hospitals that did not provide such services had 3.5 percent ($967) lower episode costs (P = .14). Quality differences between system hospitals and nonsystem hospitals were mostly small and statistically insignificant. Conclusions When operating under alternative payment model incentives, vertical integration may enable hospitals to lower costs with similar quality scores.

Understanding health disparity causes is an important first step toward developing policies or interventions to eliminate disparities, but their nature makes identifying and addressing their causes challenging. Potential causal factors are often correlated, making it difficult to distinguish their effects. These factors may exist at different organizational levels (e.g., individual, family, neighborhood), each of which needs to be appropriately conceptualized and measured. The processes that generate health disparities may include complex relationships with feedback loops and dynamic properties that traditional statistical models represent poorly. Because of this complexity, identifying disparities’ causes and remedies requires integrating findings from multiple methodologies. We highlight analytic methods and designs, multilevel approaches, complex systems modeling techniques, and qualitative methods that should be more broadly employed and adapted to advance health disparities research and identify approaches to mitigate them.

Purpose Changing market forces increasingly are leading academic medical centers (AMCs) to form or join health systems. But it is unclear how this shift is affecting the tripartite academic mission of education, research, and high-quality patient care. To explore this topic, the authors identified and characterized the types of health systems that owned or managed AMCs in the United States in 2016. Method The authors identified AMCs as any general acute care hospitals that had a resident-to-bed ratio of at least 0.25 and that were affiliated with at least one MD- or DO-granting medical school. Using the Agency for Healthcare Research and Quality 2016 Compendium of U.S. Health Systems, the authors also identified academic-affiliated health systems (AHSs) as those health systems that owned or managed at least one AMC. They compared AMCs and other general acute care hospitals, AHSs and non-AHSs, and AHSs by type of medical school relationship, using health system size, hospital characteristics, undergraduate and graduate medical education characteristics, services provided, and ownership. Results Health systems owned or managed nearly all AMCs (361, 95.8%). Of the 626 health systems, 230 (36.7%) met the definition of an AHS. Compared with other health systems, AHSs included more hospitals, provided more services, and had a lower ratio of primary care doctors to specialists. Most AHSs (136, 59.1%) had a single, shared medical school relationship, whereas 38 (16.5%) had an exclusive medical school relationship and 56 (24.3%) had multiple medical school relationships. Conclusions These findings suggest that several distinct types of relationships between AHSs and medical schools exist. The traditional vision of a medical school having an exclusive relationship with a single AHS is no longer prominent.

This cross-sectional study examines the association of physician networks with health care spending, utilization, and quality of care for Medicare beneficiaries.

Prior research on treatment of low back pain has documented large increases in use of spinal surgery, MRIs and lumbosacral injections linked to physician self-referral arrangements. No recent research has examined whether physician ownership of physical therapy services results in greater use of physical therapy to treat low back pain. The objective of this study is to investigate whether physician ownership of physical therapy services affects frequency of use, visits and types of physical therapy services received by patients with low back pain. Using claims records from insured patients covered by Blue Cross Blue Shield of Texas (2008–2011) we compared several metrics of use of physical therapy services for low back pain episodes controlling for self-referral status. We identified 158,151 low back pain episodes, 27% met the criteria to be classified as “self-referral.” Only 10% of “non-self-referral” episodes received physical therapy compared to 26% of self-referral episodes (pppppp

To support their efforts to promote high quality and efficient care, policymakers need to better understand the key factors associated with variations in physicians' decisions, and in particular, physician deviations from evidence-based care. Clinical vignette survey instruments hold potential for research in this area as an approach that both allows for practical, large-scale study and overcomes the data quality challenges posed by analysis of clinical data. These surveys present respondents with a narrative description of a hypothetical patient case and solicit responses to one or more questions regarding the care of the patient. In this review, we describe various methods for measuring variations in physicians' decisions and highlight a range of design features researchers should consider when developing a clinical vignette survey. We conclude by identifying areas for future research.

Background: Practice tools such as health information technology (HIT) have the potential to support care processes, such as communication between health care providers, and influence care for “ambulatory care–sensitive conditions” (ACSCs). ACSCs are conditions for which good outpatient care can potentially prevent the need for hospitalization. To date, associations between such primary care practice capabilities and hospitalizations for ambulatory care–sensitive conditions have been primarily limited to smaller, local studies or unique delivery systems rather than nationally representative studies of primary care physicians in the United States. Methods: We analyzed a nationally representative sample of 1,819 primary care physicians who responded to the Center for Studying Health System Change9s Physician Survey. We linked 3 years of Medicare claims (2007 to 2009) with these primary care physician survey respondents. This linkage resulted in the identification of 123,760 beneficiaries with one or more of 4 ambulatory care–sensitive chronic conditions (diabetes, chronic obstructive pulmonary disease, asthma, and congestive heart failure) for whom these physicians served as the usual provider. Key independent variables of interest were physicians9 practice capabilities, including communication with specialists, use of care managers, participation in quality and performance measurement, use of patient registries, and HIT use. The dependent variable was a summary measure of ambulatory care–sensitive hospitalizations for one or more of these 4 conditions. Results: Higher provider-reported levels of communication between primary care and specialist physicians were associated with lower rates of potentially avoidable hospitalizations. While there was no significant main effect between HIT use and ACSC hospitalizations, the associations between interspecialty communication and ACSC hospitalizations were magnified in the presence of higher HIT use. For example, patients in practices with both the highest level of interspecialty communication and the highest level of HIT use had lower odds of ambulatory care–sensitive hospitalizations than did those in practices with lower interspecialty communication and high HIT use (adjusted odds ratio, 0.70; 95% confidence limits, 0.59, 0.82). Conclusions: Greater primary care and specialist communication is associated with reduced hospitalizations for ambulatory care–sensitive conditions. This effect was magnified in the presence of higher provider-reported HIT use, suggesting that coordination of care with support from HIT is important in the treatment of ambulatory care–sensitive conditions.

Background: Despite the enactment of laws to restrict the practice of self-referral, exceptions in these prohibitions have enabled these arrangements to persist and proliferate. Most research documenting the effects of self-referral arrangements analyzed claims records from Medicare beneficiaries. Empirical evidence documenting the effects of self-referral on use of services and spending incurred by persons with private insurance is sparse. Objectives: We analyzed health insurance claims records from a large private insurer in Texas to evaluate the effects of physician self-referral arrangements involving physical therapy on the treatment of patients with frozen shoulder syndrome, elbow tendinopathy or tendinitis, and patellofemoral pain syndrome. Study Design: We used regression analysis to evaluate the effects of episode self-referral status on: (1) initiation of physical therapy; (2) physical therapy visits and services for those who had at least 1 visit; and (3) total condition-related insurer allowed amounts per episode. Results: For all 3 conditions, we found that patients treated by physician owners were much more likely to be referred for a course of physical therapy when compared with patients seen by physician nonowners. A consistent pattern emerged among patients who had at least 1 physical therapy visit; non–self-referred episodes included more physical therapy visits, and more physical therapy services per episode in comparison with episodes classified as self-referral. Most self-referred episodes were short and the initial visit did not include an evaluation. Conclusion: Physician owners of physical therapy services refer significantly higher percentages of patients to physical therapy and many are equivocal cases.

Objective To estimate the cost of defensive medicine among elderly Medicare patients. Data Sources We use a 2008 national physician survey linked to respondents’ elderly Medicare patients’ claims data. Study Design Using a sample of survey respondent/beneficiary dyads stratified by physician specialty, we estimated cross-sectional regressions of annual costs on patient covariates and a medical malpractice fear index formed from five validated physician survey questions. Defensive medicine costs were calculated as the difference between observed patient costs and those under hypothetical alternative levels of malpractice concern, and then aggregated to estimate average defensive medicine costs per beneficiary. Data Collection Methods The physician survey was conducted by mail. Patient claims were linked to survey respondents and reweighted to approximate the elderly Medicare beneficiary population. Principal Findings Higher levels of the malpractice fear index were associated with higher patient spending. Based on the measured associations, we estimated that defensive medicine accounted for 8 to 20 percent of total costs under alternative scenarios. The highest estimate is associated with a counterfactual of no malpractice concerns, which is unlikely to be socially optimal as some extrinsic incentives to avoid medical errors are desirable. Among specialty groups, primary care physicians contributed the most to defensive medicine spending. Higher costs resulted mostly from more hospital admissions and greater postacute care. Conclusions Although results are based on measured associations between malpractice fears and spending, and may not reflect the true causal effects, they suggest defensive medicine likely contributes substantial additional costs to Medicare.

Private insurers pay widely varying prices for inpatient care across hospitals. Previous research indicates that certain hospitals use market clout to obtain higher payment rates, but there have been few in-depth examinations of the relationship between hospital characteristics and pricing power. This study used private insurance claims data to identify hospitals receiving inpatient prices significantly higher or lower than the median in their market. High-price hospitals, compared to other hospitals, tend to be larger; be major teaching hospitals; belong to systems with large market shares; and provide specialized services, such as heart transplants and Level I trauma care. High-price hospitals also receive significant revenues from nonpatient sources, such as state Medicaid disproportionate-share hospital funds, and they enjoy healthy total financial margins. Quality indicators for high-price hospitals were mixed: High-price hospitals fared much better than low-price hospitals did in U.S. NewsWorld Report rankings, which are largely based on reputation, while generally scoring worse on objective measures of quality, such as postsurgical mortality rates. Thus, insurers may face resistance if they attempt to steer patients away from high-price hospitals because these facilities have good reputations and offer specialized services that may be unique in their markets.

To understand the clinical roles in which internal medicine (IM) subspecialists engage, especially those involving ongoing patient management.Measures of physician clinical roles were based on survey responses collected from 8020 mid-career IM subspecialists who registered for the American Board of Internal Medicine maintenance of certification program (86% registration/response rate) between 2009 and 2013.Each subspecialist reported their percentage of clinical time in 5 clinical roles: primary, principal, longitudinal consultative, medical consultative, and procedural care. We characterized an IM subspecialist's clinical role focus as those roles that composed a majority of their clinical time.Most IM subspecialists reported spending a majority of their time performing 1 (65%) or 2 (31%) clinical roles. Most (54%) reported a clinical role focused on ongoing patient care management roles, including principal care (eg, total responsibility for a specific condition, 23%), longitudinal consultative care (eg, shared care, 21%); or a mixed clinical role focus composed of both principal and longitudinal consultative care (8%). We also found that physicians focused on ongoing patient care management roles represent a significant percentage of physicians within most IM subspecialties (ranging from 19% to 88% across subspecialties).A subspecialist's clinical role focus is an important practice characteristic, and many subspecialists perceive themselves as playing a significant role in care management. These findings suggest there are opportunities to incorporate subspecialists into newer payment and care delivery reforms; they also bring to light reasons that training and certification programs should consider the different clinical role foci subspecialists adopt.

The Medicare Access and CHIP Reauthorization Act (MACRA) introduces incentives for clinicians serving Medicare patients to move away from traditional "fee-for-service" and into alternative payment models (APMs) such as accountable care organizations and bundled payment arrangements. Thus, MACRA creates strong reasons for various teaching clinical services to participate in APMs, not only for Medicare patients but for other public and private payers as well. Unfortunately, different APMs may be more or less applicable to the diverse teaching physician roles, academic clinical programs, and patient populations served by medical schools and teaching hospitals. Therefore, this time of transition will complicate the work of academic clinical program leaders endeavoring to sustain the tripartite mission of patient care, health professional education, and research. Nonetheless, payment reforms promoted by MACRA can reward efforts to reinvent medical education to better incorporate value into medical decision making, as well as to give clinical learners the tools and insights needed to recognize their personal financial (and other) conflicts and navigate these to meet their patients' needs. This post-MACRA environment may intensify the need for researchers in academic medicine to stay independent of the short-term financial interests of affiliated clinical institutions. Health sciences scholars must be able to study effectively and speak forcefully regarding the actual benefits, risks, and costs of health care services so that educators and clinicians can identify high-value care and deliver it to their patients.

Objective To examine whether the course of physical therapy treatments received by patients who undergo total knee replacement (TKR) surgery differs depending on whether the orthopedic surgeon has a financial stake in physical therapy services. Data Sample of Medicare beneficiaries who underwent TKR surgery during the years 2007–2009. Study Design We used regression analysis to evaluate the effect of physician self-referral on the following outcomes: (1) time from discharge to first physical therapy visit; (2) episode length; (3) number of physical therapy visits per episode; (4) number of physical therapy service units per episode; and (5) number of physical therapy services per episode expressed in relative value units. Principal Findings TKR patients who underwent physical therapy treatment at a physician-owned clinic received on average twice as many physical therapy visits (8.3 more) than patients whose TKR surgery was performed by a orthopedic surgeon who did not self-refer physical therapy services (p

The Patient Protection and Affordable Care Act (PPACA) of 2010 will increase access to health insurance for a large proportion of the population that is currently uninsured. Moreover, the PPACA also introduced important reforms to the individual and small group insurance markets that will assure better access to affordable coverage for these populations through a combination of insurance reform and individual and employer mandates that require most individuals to have health insurance. While health reform takes important steps toward assuring equitable access to care, attention is already shifting toward addressing problems related to escalating costs and inadequate quality of care. The natural target of such strategies is physicians. Although direct spending for physicians' services accounts for just 21.2 percent of total health care spending, physicians' treatment and referral decisions determine the vast majority of health care spending (Center for Medicare and Medicaid Services 2008). The methods used to compensate physicians are among the relatively few policy tools available to influence physician decision making and a number of payment and delivery system reforms envisioned by health reform (e.g., episode-based payments, accountable care organizations) have the potential for changing compensation incentives. Prior research demonstrates that physicians respond to financial incentives (Conrad and Christianson 2004; Shen et al. 2004; Conrad, Maynard, and Cheadle 2008; Jacobson et al. 2010; Shahinian, Kuo, and Gilbert 2010). Although there is a relatively strong literature documenting how physicians' practice arrangements have changed over the last two decades (e.g., more large group practices) and how financial arrangements are structured between physician practices and health plans, much less is known about how arrangements between payers and practices are translated into specific compensation arrangements for physicians, and how these arrangements, in turn, influence the delivery of care (Hillman 1987; Hillman, Pauly, and Kerstein 1989; Hillman, Welch, and Pauly 1992; Robinson and Casalino 1995; Robinson 2001; Rosenthal et al. 2001; Landon et al. 2005). Complicating this is the fact that typical physician practices have contracts with over a dozen private health plans (along with public payers), each of which might carry different terms and incentives. Without this basic knowledge, policies based on financial incentives might be ineffective or have unintended consequences. We address these issues by analyzing data from a large, nationally representative survey of physicians, the Community Tracking Study (CTS) Physician Survey (Center for Studying Health System Change 2011). Previously, we created and validated a typology of physician payment based on a revised and expanded module on physician payment arrangements and incentives included in the 2004–2005 CTS survey (Landon et al. 2009). In this paper, we link these survey data with claims data from the Centers for Medicare and Medicaid Services for services delivered to Medicare beneficiaries treated by these physicians over a 3-year period (2004–2006) in order to examine the relationship between physician compensation arrangements and the costs and intensity of care delivered to Medicare beneficiaries. Our analysis focused on two particular research questions: (1) What is the relationship between primary care physicians' (PCP) payment arrangements and the total costs of care for beneficiaries for whom they provided the plurality of primary care services? (2) How do payment arrangements influence the number of episodes and the intensity of care for treatment of episodes of care?

Objective. To identify factors associated with the cost of treating high-cost Medicare beneficiaries. Data Sources. A national sample of 1.6 million elderly, Medicare beneficiaries linked to 2004–2005 Community Tracking Study Physician Survey respondents and local market data from secondary sources. Study Design. Using 12 months of claims data from 2005 to 2006, the sample was divided into predicted high-cost (top quartile) and lower cost beneficiaries using a risk-adjustment model. For each group, total annual standardized costs of care were regressed on beneficiary, usual source of care physician, practice, and market characteristics. Principal Findings. Among high-cost beneficiaries, health was the predominant predictor of costs, with most physician and practice and many market factors (including provider supply) insignificant or weakly related to cost. Beneficiaries whose usual physician was a medical specialist or reported inadequate office visit time, medical specialist supply, provider for-profit status, care fragmentation, and Medicare fees were associated with higher costs. Conclusions. Health reform policies currently envisioned to improve care and lower costs may have small effects on high-cost patients who consume most resources. Instead, developing interventions tailored to improve care and lowering cost for specific types of complex and costly patients may hold greater potential for “bending the cost curve.”

Whether patient care is improved by physicians maintaining their American Board of Internal Medicine certification is not known. This study compared how often physicians who had maintained certific...

This paper estimates the relationship between Medicare fees and quantities provided by physicians for eight specific services. It uses data for 13,707 physicians who responded to surveys in 2000/2001 and/or 2004/2005 and were linked to all Medicare claims for their Medicare patients. Results show that Medicare fees are positively related to quantity provided for all eight services, and are significantly different from zero and elastic for five of them. The findings are consistent with the general economic proposition that supply curves for metrical services are positively sloped, and provide no evidence of volume-offset behavior for the services examined. These results also imply that Medicare could influence volume growth for specific services by varying their fee changes, and that uniform fee changes will have differential effects on service volume because of variation in underlying supply elasticities. ********** With accelerating health care costs and a growing beneficiary population, the Medicare trustees predict the program will become insolvent in 2017, magnifying pressure to find ways to control spending (Boards of Trustees 2009). Most of the recent growth in program costs is due to increases in the volume of services provided to beneficiaries, rather than increases in the number of beneficiaries or greater disease burdens among beneficiaries (MedPAC 2008a; Maxwell, Zuckerman, and Berenson 2007). A major conundrum in trying to understand the reasons behind volume growth is the role of the Medicare fee schedule (MFS). Medicare physician fees, on average, have been relatively flat in recent years, effectively declining after accounting for inflation. Since volume has continued to grow, many conclude that either fee changes do not affect service volume, physicians respond perversely to fee decreases by increasing the volume of services, or both. In economists' parlance, this implies the supply curve is backward bending. Since the fee schedule is one of the few policy tools that Medicare potentially has available to influence service volume, it is critical to have a better understanding of how changes in Medicare fees affect Medicare service volume. An earlier study (Hadley and Reschovsky 2006) addressed this relationship by estimating models that measured Medicare volume as the total number of relative value units (RVUs) provided, and defined an average Medicare fee as total allowed charges for all services divided by the total number of relative value units. (1) The analysis indicated that this average Medicare fee variable was subject to substantial endogeneity bias. (2) Adjusting for this bias by using instrumental variable estimation resulted in a supply elasticity estimate that was statistically significant, positive, and greater than one in magnitude. If the fee elasticity is positive, then the aggregate association observed between Medicare volume and Medicare fees must reflect the effects of other factors, such as the introduction of new services, RVU upgrades for selected services, physicians" responses to cost reductions not captured by RVU assignments, and changes in private demand that make Medicare's payment rates look relatively more generous. This study extends that earlier research by estimating models of physicians' provision of specific individual services to their Medicare patients. Focusing on specific services allows the construction of an exogenous measure of variations in the Medicare fee for each service and avoids the statistical problems inherent in using instrumental variable methods to estimate an aggregate supply model. (3) If the fee elasticity for individual services were also to be positive, then this result would reinforce the inference drawn from the earlier study based on instrumental variable estimation. The methodology we employ also could provide policymakers with potentially valuable information about differences in fee elasticities across various services that could be used in reforming payment methods. …

Racial and ethnic disparities in primary health care likely reflect the aggregate socioeconomic composition of a physician's patient panels as well as differences in individual patients’ ...

This paper investigates low rates of employer health insurance coverage among Hispanics using national data from the Community Tracking Study Household Survey. Interview language served as a proxy for the degree of assimilation. Findings indicate that English-speaking Hispanics are more similar to whites in their labor market experiences and coverage than they are to Spanish-speaking Hispanics. Spanish-speakers' very low human capital (including their inability to speak English) results in much less access to job-based insurance. Though less important, Spanish-speaking Hispanics' demand for employer-sponsored insurance appears lower than that of English-speaking Hispanics or whites. Results suggest that language and job training may be the most effective way to bolster Hispanics' insurance coverage.

An important goal of the Affordable Care Act is to transform the US health care system from one characterized by high costs, poor quality, and fragmented care to one focused on comprehensive, coordinated, and efficient care.

BackgroundDatabases of practicing physicians are important for studies that require sampling physicians or counting the physician population in a given area. However, little is known about how the three main sampling frames differ from each other.ObjectiveOur purpose was to compare the National Provider and Plan Enumeration System (NPPES), the American Medical Association Masterfile and the SK&A physician file.MethodsWe randomly sampled 3000 physicians from the NPPES (500 in six specialties). We conducted two- and three-way comparisons across three databases to determine the extent to which they matched on address and specialty. In addition, we randomly selected 1200 physicians (200 per specialty) for telephone verification.Key resultsOne thousand, six hundred and fifty-five physicians (55 %) were found in all three data files. The SK&A data file had the highest rate of missing physicians when compared to the NPPES, and varied by specialty (50 % in radiology vs. 28 % in cardiology). NPPES and SK&A had the highest rates of matching mailing address information, while the AMA Masterfile had low rates compared with the NPPES. We were able to confirm 65 % of physicians' address information by phone. The NPPES and SK&A had similar rates of correct address information in phone verification (72-94 % and 79-92 %, respectively, across specialties), while the AMA Masterfile had significantly lower rates of correct address information across all specialties (32-54 % across specialties).ConclusionsNone of the data files in this study were perfect; the fact that we were unable to reach one-third of our telephone verification sample is troubling. However, the study offers some encouragement for researchers conducting physician surveys. The NPPES and to a lesser extent, the SK&A file, appear to provide reasonably accurate, up-to-date address information for physicians billing public and provider insurers.

For the latter third of the twentieth century, researchers have estimated production and cost functions for physician practices. Today, those attempting to measure the inputs and outputs of physician practice must account for many recent changes in models of care delivery. In this paper, we review practice inputs and outputs as typically described in research on the economics of medical practice, and consider the implications of the changing organization of medical practice and nature of physician work. This evolving environment has created conceptual challenges in what are the appropriate measures of output from physician work, as well as what inputs should be measured. Likewise, the increasing complexity of physician practice organizations has introduced challenges to finding the appropriate data sources for measuring these constructs. Both these conceptual and data challenges pose measurement issues that must be overcome to study the economics of modern medical practice. Despite these challenges, there are several promising initiatives involving data sharing at the organizational level that could provide a starting point for developing the needed new data sources and metrics for physician inputs and outputs. However, additional efforts will be required to establish data collection approaches and measurements applicable to smaller and single specialty practices. Overcoming these measurement and data challenges will be key to supporting policy-relevant research on the changing economics of medical practice.

There is ample evidence that many clinical decisions made by physicians are inconsistent with current and generally accepted evidence. This leads to the underuse of some efficacious diagnostic, preventive or therapeutic services, and the overuse of others of marginal or no value to the patient. Evolving new payment and delivery models place greater emphasis on the provision of evidence-based services at the point of care. However, changing physician clinical behaviors is likely to be difficult and slow. Policy makers therefore need to design interventions that are most effective in promoting greater evidence-based care. To help identify modifiable factors that can influence clinical decisions at the point of care, we present a conceptual model and literature review of physician decision making. We describe the multitude of factors--drawn from different disciplines--that have been shown to influence physician point-of-care decisions. We present a conceptual framework for organizing these factors, dividing them into patient, physician, practice site, physician organization, network, market, and public policy influences. In doing so, we review some of the literature that speak to these factors. We then identify areas where additional research is especially needed, and discuss the challenges and opportunities for health services and policy researchers to gain a better understanding of these factors, particularly those that are potentially modifiable by policymakers and organizational leaders.

Congress is again attempting to repeal the Sustainable Growth Rate (SGR) formula. The formula is a failed mechanism intended to constrain Medicare Part B physician spending by adjusting annual physician fee updates. Congress has averted formula-driven physician fee cuts each year beginning in 2003 by overriding the SGR, usually accompanied with last-minute disputes about how these overrides should be paid for. Last year Congress achieved bipartisan and bicameral agreement on legislation to replace the SGR—the SGR Repeal and Medicare Provider Payment Modernization Act of 2014, which we refer to as the "2014 SGR fix"—but was unable to find a way to pay for the legislation under current budget rules. Current congressional deliberations appear focused on how to pay for the fix, with wide consensus that the 2014 legislation should remain the basic model for reform. We describe key features of the 2014 SGR fix, place it in the context of both past and ongoing Medicare health policy, assess its strengths and weaknesses as a mechanism to foster improved care and lower costs in Medicare, and suggest further actions to ensure success in meeting these goals.

States increasingly are using premiums for near-poor children in their public insurance programs (Medicaid/SCHIP) to limit private insurance crowd-out and constrain program costs. Using national data from four rounds of the Community Tracking Study Household Surveys spanning the seven years from 1996 to 2003, this study estimates a multinomial logistic regression model examining how public and private insurance premiums affect insurance coverage outcomes (Medicaid/SCHIP coverage, private coverage, and no coverage). Higher public premiums are significantly associated with a lower probability of public coverage and higher probabilities of private coverage and uninsurance; higher private premiums are significantly related to a lower probability of private coverage and higher probabilities of public coverage and uninsurance. The results imply that uninsurance rates will rise if both public and private premiums increase, and suggest that states that impose or increase public insurance premiums for near-poor children will succeed in discouraging crowd-out of private insurance, but at the expense of higher rates of uninsurance. Sustained increases in private insurance premiums will continue to create enrollment pressures on state insurance programs for children.

During the past decade, a confluence of forces has changed the practice of medicine in unprecedented ways. Anecdotal reports suggest that, in response, some physicians are leaving the practice of medicine or retiring earlier than they otherwise would have.We sought to examine how physician demographic characteristics, practice characteristics, and career satisfaction are related to physician decisions to leave the practice of medicine or substantially cut back their practice hours.Data for this study are from the first 2 rounds of the Community Tracking Study (CTS) Physician Survey, a series of nationally representative telephone surveys of physicians first conducted in 1996. Subsequent rounds of the survey included physicians sampled in the previous round, which allowed us to ascertain their career status 2 years after their initial interviews.Primary care and specialist physicians initially spending at least 20 hours per week in direct patient care activities were studied.Physicians cutting back their practice hours to less than 20 hours per week or leaving the practice of medicine altogether.Of the 16,681 physicians interviewed for whom we also had information about their career status 2 years later, 462 (2.8%) had retired and 499 (3.0%) had reduced time spent in patient care to less than 20 hours per week. In multinomial logistic analyses that examined both outcomes, full- or part-owners of practices were both less likely to retire and to cut back hours. Internal medicine specialists and psychiatrists were less likely to retire (odds ratio [OR] 0.69, 95% confidence interval [CI] 0.48-0.99 and OR 0.33, 95% CI 0.18-0.60 respectively) whereas surgical specialists were more likely to retire (OR 1.6, 95% CI 1.1-2.2). Physician satisfaction was strongly related to both outcomes. For instance, very dissatisfied physicians were both more likely to retire (OR 2.34, 95% CI 1.6-3.5) and cut back on their hours (OR 3.6, 95% CI 2.32-5.6).Our findings demonstrate that dissatisfied physicians were 2 to 3 times more likely to leave medicine than satisfied physicians. These findings have implications for physician manpower projections and quality of care.

Importance In 1990, the American Board of Internal Medicine (ABIM) ended lifelong certification by initiating a 10-year Maintenance of Certification (MOC) program that first took effect in 2000. Despite the importance of this change, there has been limited research examining associations between the MOC requirement and patient outcomes. Objective To measure associations between the original ABIM MOC requirement and outcomes of care. Design, Setting, and Participants Quasi-experimental comparison between outcomes for Medicare beneficiaries treated in 2001 by 2 groups of ABIM-certified internal medicine physicians (general internists). One group (n = 956), initially certified in 1991, was required to fulfill the MOC program in 2001 (MOC-required) and treated 84 215 beneficiaries in the sample; the other group (n = 974), initially certified in 1989, was grandfathered out of the MOC requirement (MOC-grandfathered) and treated 69 830 similar beneficiaries in the sample. We compared differences in outcomes for the beneficiary cohort treated by the MOC-required general internists before (1999-2000) and after (2002-2005) they were required to complete MOC, using the beneficiary cohort treated by the MOC-grandfathered general internists as the control. Main Outcomes and Measures Quality measures were ambulatory care–sensitive hospitalizations (ACSHs), measured using prevention quality indicators. Ambulatory care–sensitive hospitalizations are hospitalizations triggered by conditions thought to be potentially preventable through better access to and quality of outpatient care. Other outcomes included health care cost measures (adjusted to 2013 dollars). Results Annual incidence of ACSHs (per 1000 beneficiaries) increased from the pre-MOC period (37.9 for MOC-required beneficiaries vs 37.0 for MOC-grandfathered beneficiaries) to the post-MOC period (61.8 for MOC-required beneficiaries vs 61.4 for MOC-grandfathered beneficiaries) for both cohorts, as did annual per-beneficiary health care costs (pre-MOC period, $5157 for MOC-required beneficiaries vs $5133 for MOC-grandfathered beneficiaries; post-MOC period, $7633 for MOC-required beneficiaries vs $7793 for MOC-grandfathered beneficiaries). The MOC requirement was not statistically associated with cohort differences in the growth of the annual ACSH rate (per 1000 beneficiaries, 0.1 [95% CI, −1.7 to 1.9];P = .92), but was associated with a cohort difference in the annual, per-beneficiary cost growth of −$167 (95% CI, −$270.5 to −$63.5;P = .002; 2.5% of overall mean cost). Conclusion and Relevance Imposition of the MOC requirement was not associated with a difference in the increase in ACSHs but was associated with a small reduction in the growth differences of costs for a cohort of Medicare beneficiaries.

To examine the relationship between the compensation strategies of primary care physicians (PCPs) and the quality and outcomes of care delivered to Medicare beneficiaries.Cross-sectional analysis of physician survey data linked to Medicare claims. We used a previously constructed typology that was developed based on the survey to categorize physician compensation strategies.We combined data from the 2004-2005 Community Tracking Study Physician Survey on PCP compensation methods with administrative claims from the Medicare program. We analyzed the proportion of eligible beneficiaries receiving each of 7 preventive services and rates of preventable admissions for acute and chronic conditions. We measured the latter using Prevention Quality Indicators (PQIs), available from the Agency for Healthcare Research and Quality.The 2211 PCP respondents included 937 internists and 1274 family or general physicians who were linked to more than 250,000 Medicare enrollees. Employed physicians with productivity and other incentives were more likely to deliver care of high quality when compared with salaried physicians. For instance, the odds of appropriate monitoring for diabetics ranged from 1.26 to 1.47 (all P.01). Physicians in highly capitated environments had similar or better quality compared with physicians in other environments across most measures. The association between compensation strategies and outcomes of care as measured by PQIs was inconsistent, although owners with no other incentives had consistent higher rates of acute and chronic PQI admission (eg, for the chronic PQI composite: odds ratio = 1.07; 95% CI, 1.02-1.12).Physician compensation strategies are associated with the quality of preventive services delivered to Medicare patients, but inconsistently associated with outcomes of care. Increasing use of global payment strategies is not likely to lead to lower quality.

Average hospital outpatient department prices for common imaging, colonoscopy and laboratory services can be double the price for identical services provided in a physician’s office or other community-based setting.

This issue brief finds that when episodes of care involving hospitalizations, similar to Model 2 of the ongoing Centers for Medicare & Medicaid Services Bundled Payment for Care Improvement demonstration, are applied to privately insured patients, inpatient prices drive the bulk of episode-spending variation. Hospitals with high spending for one service line tend to have high spending for other service lines. The study used 2011 claims data for 590,000 active and retired nonelderly autoworkers and dependents.

Variations in medical practice are far more complex than the simple narrative popularly attributed to the Dartmouth Atlas.

Objective: To identify associations between market factors, especially relative reimbursement rates, and the probability of surgery and cost per episode for three medical conditions (cataract, benign prostatic neoplasm, and knee degeneration) with multiple treatment options. Methods: We use 2004 - 2006 Medicare claims data for elderly beneficiaries from sixty nationally representative communities to estimate multivariate models for the probability of surgery and cost per episode of care as a function local market factors, including Medicare physician reimbursement for surgical versus non-surgical treatment and the availability of primary care and specialty physicians. We used Symmetry's Episode Treatment Groups (ETG) software to group claims into episodes for the three conditions (n = 540,874 episodes). Results: Higher Medicare reimbursement for surgical episodes and greater availability of the relevant specialists are significantly associated with more surgery and higher cost per episode for all three conditions, while greater availability of primary care physicians is significantly associated with less frequent surgery and lower cost per episode. Conclusion: Relative Medicare reimbursement rates for surgical vs. non-surgical treatments and the availability of both primary care physicians and relevant specialists are associated with the likelihood of surgery and cost per episode.

Background. One of the principal tenets of managed care is that physicians’ clinical decisions can be influenced both to improve the quality and consistency of care and to decrease health care expenditures. Medical decision making, however, remains a complex phenomenon and the most important determinants of physicians’ approaches to clinical decision making remain poorly understood. Objectives. To determine how clinical decisions are associated with individual characteristics, practice setting and organizational characteristics, attributes of the patient population under care, and the market environment. Research Design. Cross-sectional, nationally representative survey of patient-care physicians. Subjects. Primary care physicians who provide direct patient care at least 20 hours per week. Measures. Proportion of physicians who would order a referral, diagnostic test, or treatment for 5 clinical scenarios thought to be representative of discretionary medical decisions. Results. Responses were received from 4,825 primary care physicians who cared for adult patients (Response Rate 65%). The distribution of results for each of the five clinical scenarios demonstrates significant variability both within and between physicians. No evidence was seen of a consistent practice style across the vignettes (eg, “aggressive” or “conservative”). The organizational setting of practice was the most consistent predictor of behavior across all the clinical scenarios, with the exception of back pain, which was minimally related to any of the environmental factors. When compared to physicians in solo practice, physicians in all other practice settings were less likely to order a test or referral or pursue treatment. Practice involvement with managed care and measures of financial influences and administrative strategies associated with managed care were minimally and inconsistently associated with reported physician behaviors. Conclusions. The ability of managed care to improve the quality and consistency of care while also controlling the costs of care depends on its ability to influence medical decisions. Our findings generally demonstrate that managed care has a weak influence on discretionary medical decisions and that the influence of managed care pales in comparison to personal and practice setting influences.

This paper examines trends in out-of-pocket spending for insured workers from 1990 to 1997. Data are from the Consumer Expenditure Survey conducted by the U.S. Bureau of Labor Statistics. The survey collects detailed quarterly data on all consumer spending from logs kept each year by more than 10,000 households with job-based health insurance. During the study period, total out-of-pocket spending in constant dollars remained unchanged. Spending for medical expenses, drugs, and supplies declined by 23 percent, but this decline was offset by rising employee contributions for health insurance premiums. The shift to managed care, whose benefit structure requires less cost sharing, may have played a role in reducing out-of-pocket spending.

With the growth of managed care, there are increasing concerns but inconclusive evidence regarding deterioration in the quality of medical care.To assess physicians' perceptions of their ability to provide high-quality care and explore what factors, including managed care, affect these perceptions.Bivariate and multivariate analyses of the Community Tracking Study Physician Survey, a cross-sectional, nationally representative telephone survey of 12,385 patient-care physicians conducted in 1996/1997. The response rate was 65%.Physicians who provide direct patient care foror =20 h/wk, excluding federal employees and those in selected specialties.Level of agreement with 4 statements: 1 regarding overall ability to provide high-quality care and 3 regarding aspects of care delivery associated with quality.Between 21% and 31% of physicians disagreed with the quality statements. Specialists were generally 50% more likely than primary care physicians to express concerns about their ability to provide quality care. Generally, the number of managed care contracts, but not the percent of practice revenue from managed care, was negatively associated with perceived quality. Market-level managed care penetration independently affected physicians' perceptions. Practice setting affected perceptions of quality, with physicians in group settings less likely to express concerns than physicians in solo and 2-physician practices. Specific financial incentives and care management tools had limited positive or negative associations with perceived quality.Managed care involvement is only modestly associated with reduced perceptions of quality among physicians, with some specific tools enhancing perceived quality. Physicians may be able to moderate some negative effects of managed care by altering their practice arrangements.

This paper estimates the life-cycle costs of housing for persons with mental illness using 5-year and 30-year holding periods and discount rates of 3.5, 5.75, and 8.0%. Life-cycle costs are between 5 and 7% higher in buildings occupied only by mentally ill tenants compared to buildings with no mentally ill tenants. However, the economies of scale in maintenance and repair that exist in buildings occupied by the non-mentally ill are not observed in buildings with mentally ill tenants. Additionally, buildings located in lower-quality neighborhoods have lower life-cycle costs when the tenants are mentally ill, just the reverse of the case for the general population.

Across 13 selected U.S. metropolitan areas, hospital prices for privately insured patients are much higher than Medicare payment rates and vary widely across and within markets, according to a study by the Center for Studying Health System Change (HSC) based on claims data for about 590,000 active and retired nonelderly autoworkers and their dependents. Across the 13 communities, aver­age hospital prices for privately insured patients are about one-and-a-half times Medicare rates for inpatient care and two times what Medicare pays for outpa­tient care. Within individual communities, prices vary widely, with the highest-priced hospital typically paid 60 percent more for inpatient services than the lowest-priced hospital. The price gap within markets is even greater for hospital outpatient care, with the highest-priced hospital typically paid nearly double the lowest-priced hospital. In contrast to the wide variation in hospital prices for pri­vately insured patients across and within markets, prices for primary care physi­cian services generally are close to Medicare rates and vary little within markets. Prices for specialist physician services, however, are higher relative to Medicare and vary more across and within markets. Of the 13 markets, five are in Michigan, which has an unusually concentrated private insurance market, with one insurer commanding a 70-percent market share. Despite the presence of a dominant insurer, almost all Michigan hospi­tals command prices that are higher than Medicare, and some hospitals com­mand prices that are twice what Medicare pays. In the eight markets outside of Michigan, private insurers generally pay even higher hospital prices, with even wider gaps between high- and low-priced hospitals. The variation in hospital and specialist physician prices within communities underscores that some hospitals and physicians have significant market power to command high prices, even in markets with a dominant insurer.

Despite widespread agreement that physicians who practice defensive medicine drive up health care costs, the extent to which defensive medicine increases costs is unclear. The differences in findings to date stem in part from the use of two distinct approaches for assessing physicians' perceived malpractice risk. In this study we used an alternative strategy: We linked physicians' responses regarding their levels of malpractice concern as reported in the 2008 Health Tracking Physician Survey to Medicare Parts A and B claims for the patients they treated during the study period, 2007-09. We found that physicians who reported a high level of malpractice concern were most likely to engage in practices that would be considered defensive when diagnosing patients who visited their offices with new complaints of chest pain, headache, or lower back pain. No consistent relationship was seen, however, when state-level indicators of malpractice risk replaced self-rated concern. Reducing defensive medicine may require approaches focused on physicians' perceptions of legal risk and the underlying factors driving those perceptions.

The relationship between practice intensity and the quality and outcomes of care has not been studied.To examine the relationship between primary care physicians' costliness both for defined episodes of care and for defined patients and the quality and outcomes of care delivered to Medicare beneficiaries.Cross sectional analysis of physician survey data linked to Medicare claims. Physician costliness measures were calculated by comparing the episode specific and overall costs of care for their patients with the care delivered by other physicians.We studied physicians participating in the 2004-2005 Community Tracking Study Physician Survey linked with administrative claims from the Medicare program for the years 2004-2006.Proportion of eligible beneficiaries receiving each of seven preventive services and rates of preventable admissions for acute and chronic conditions.The 2,211 primary care physician respondents included 937 internists and 1,274 family or general physicians who were linked to more than 250,000 Medicare enrollees. Patients treated by more costly physicians (whether measured by the overall costliness index or the episode-level index) were more likely to receive recommended preventive services, but were also more likely to experience preventable admissions. For instance, physicians in the lowest quartile of costliness performed appropriate monitoring for hemoglobin A1C for diabetics 72.8% of the time, as compared with 81.9% for physicians in the highest quartile of costliness (p 0.01). In contrast, patients treated by the physicians in the lowest quartile of episode costliness were admitted at a rate of 1.8/100 for both acute and chronic Prevention Quality Indicators (PQIs), as compared with 2.9/100 for both acute and chronic PQIs for those treated by physicians in the highest quartile of costliness (p 0.001).Physician practice patterns are associated with the quality of preventive services delivered to Medicare patients. Ongoing efforts to influence physician practice patterns may have differential effects on different aspects of quality.

Control for area differences in population health (casemix adjustment) is necessary to measure geographic variations in medical spending. Studies use various casemix adjustment methods, resulting in very different geographic variation estimates. We study casemix adjustment methodological issues and evaluate alternative approaches using claims from 1.6 million Medicare beneficiaries in 60 representative communities. Two key casemix adjustment methods—controlling for patient conditions obtained from diagnoses on claims and expenditures of those at the end of life—were evaluated. We failed to find evidence of bias in the former approach attributable to area differences in physician diagnostic patterns, as others have found, and found that the assumption underpinning the latter approach—that persons close to death are equally sick across areas—cannot be supported. Diagnosis-based approaches are more appropriate when current rather than prior year diagnoses are used. Population health likely explains more than 75% to 85% of cost variations across fixed sets of areas.