Canadian Medical Association Journal 1996; 155: 159-165
A recent trip to Scotland, sponsored by the World Health Organization, provided me with a firsthand look at capitation and insight in- to why it makes sense. Instead of merely reacting to patients who walk through the door with a shopping card -- a system which, at best, provides evidence-minded physicians with only the numerators for data -- physicians find themselves in possession of a denominator. They know who their patients are and what percentage has had blood-pressure checks, Papanicolaou smears or rectal examinations. They can set health goals for a practice and use their skills and those of paraprofessional staff to manage and educate patients in order to reach those goals. Most satisfying of all, physicians can evaluate their efforts. Everything about health care and the practice of medicine seems stressful these days. For physicians, the prospect of knowing what and who they are responsible for, and the ability to show that their work makes a difference, offer greater job satisfaction.
Capitation is not a panacea, but it carries the potential to help physicians make sense of their work.
David Bowering, MD, MHSc
Director
Skeena Health Unit
Terrace, BC
Both of these articles expose the myth that capitation-payment models are more desirable than fee-for-service (FFS) ones. Capitation is often touted as a payment model that results in increased preventive care, reduced hospital admissions and improved patient care. Several studies[1-3] have shown that there is no difference in the amount of preventive care under the two models, and Hutchison and associates' article shows that there is no difference in hospital admissions in a capitation-payment system and thus no cost savings over an FFS system.
The myth of the benefits of capitation payment has been promoted for years by governments, health care consultants and paramedical organizations. Hutchison and associates' article will help put an end to the continued encouragement of capitation-payment models.
As Korcok points out, a Congressional report "showed that cost-based denials happen far too often" under capitation. The report cited serious problems with quality in health maintenance organizations (HMOs) in which care was covered entirely on a capitation basis. The managed-care versions of capitation in the United States put physicians in the difficult position of being forced to choose between what is in the best interests of patients and what is in the best interests of the HMO. These major problems are all too often overlooked by the critics of the FFS system.
After having conducted an extensive review of funding methods, the Primary Care Reform Committee of the Ontario Medical Association believes strongly that FFS continues to be the best payment mechanism for physicians.
The two CMAJ articles support the committee's contention that any change to the FFS system should have methods of evaluation built in so that any real benefit can be demonstrated. Public surveys show that the health care system in Canada is considered the best in the world, both by Canadians and by citizens of other countries. Why would anyone introduce major changes without proper evaluation and proven benefit?
Kent Gerred, MD
Primary Care Reform Committee
Ontario Medical Association
Toronto, Ont.
I would like to add a historical word or two about HSOs and capitation-based health care in Ontario. Around 1973, Ontario's Minister of Health, Dr. R.T. Potter, was under pressure from organized labour to support community health centres (CHCs). He was particularly criticized for refusing to authorize the establishment of a CHC in Ottawa. The Hospital Services Commission had been destroyed by the politicians, and I was looking for a way to escape the civil service. The minister had meanwhile decided that perhaps there should be some action on CHCs. Since I had been a member of the original CHC project, led by Dr. John E.F. Hastings,1 he asked me to investigate whether CHCs could be established in Ontario. I accepted with hope, which, I soon learned, is not miscible with reality.
Although I was knowledgeable about the concept of CHCs presented in Hastings' report, and had dealt with the province's two major, existing centres in Sault Ste. Marie and Saint Catharines, I was convinced that few physicians would choose to report to lay boards. Assisted by two of the brighter people in the Ontario Ministry of Health, I sought to come up with a type of group practice that would replicate CHCs in many ways but would be owned and managed by physicians. HSOs were the result.
The primary purpose of HSOs was to include the practice of other health care professionals in providing appropriate primary care, without physicians having to pick up the tab as part of their fee for service. There was to be no increase in comparable costs. We were anxious to involve nurse practitioners, whose effectiveness had already been established. Unless we could set up some sort of global budget, funding could only be by capitation. However, there was no intention to pay solo practitioners by capitation. Indeed, some would have barely made a living under such a payment scheme.
The growth and development of HSOs from those early days depended on the attitudes of succeeding ministers of health, some of whom were guided by their ideological beliefs. Apart from our small group, the rest of the Ontario Ministry of Health was hostile. Organized medicine was in constant opposition. I am therefore amazed at the number of HSOs discussed in the study by Hutchison and associates. The function of HSOs in the system -- to increase the productivity of primary health care services -- is clear and nonthreatening. Several HSOs have successfully incorporated some social services. I wonder why a few HSOs with inventive physicians do not establish "branch plants" in underserviced areas?
John S.W. Aldis, MD
Port Hope, Ont.
Caution should temper the new enthusiasm for capitation ("Physician remuneration methods: the need for change and flexibility," CMAJ 1996;154:678-80 [abstract / résumé], by Dr. Charles J. Wright). More Canadians (56%) are satisfied with their health care than are their counterparts in the United States (55%), West Germany (45%) and Britain (41%), the home of capitation-based health care funding.[1]
Anyone with experience in publicly funded health care programs in other countries knows that Canada's is the best in the world, and that it achieved excellence within an FFS remuneration system. One of the frustrations of immigrating to Canada is seeing Canadians succumb to that Canadian lack of confidence because all is not perfect and substitute an inferior product because it originates in Europe or the United States. To quote John Ralston Saul, "Perhaps the single innovation most needed today is a calm look at what we have accomplished, followed by serious attempts at consolidation. We must force ourselves out of the corporate obsession with form in order to concentrate on the content that is at stake."[2]
Unfortunately, we live in a society where form is no longer related to function. Canadian health care functions in an FFS form. Will it function as well in a capitation form?
Paul Cary, MB, BS, MRCS, LRCP,
DRCOG
Cambridge, Ont.
I wonder whether Cary would support the continuation of the huge current discrepancies in compensation based on whether a physician happens to spend time counselling patients, treating illnesses, inserting tubes in orifices or removing body parts. These differences have arisen mainly by historical accident and are not only perpetuated but accentuated by each percentage change in the fee structure. A more equitable and realistic fee structure would be more palatable, but the inability of provincial medical associations to steer significant change in that direction shows that this goal cannot be achieved.
Cary also fails to address the need to compensate adequately physicians who are prepared to spend time on the program design and evaluation, clinical research and outcome studies that are needed to validate much of our current activity. As I emphasized in my editorial, the modern health care system requires flexibility in physician remuneration methods to deal with a health care environment that is now much too complex to be managed under an FFS system alone.
Charles J. Wright, MB, MSc, FRCSC
Clinical professor
Health Care and Epidemiology
University of British Columbia
Vancouver, BC