 Alternative payment models and physician treatment decisions: Evidence from lower back painYu Ding and Chenyuan Liu Journal of Health Economics, 2021, vol. 80, issue C Abstract: The capitated payment model has been used to address the high cost of health care. Under capitation, physicians are compensated with a fixed amount per patient, regardless of the services generated. We provide new evidence on how the capitation payment model changes physicians behaviors by studying the treatment of lower back pain, as this type of treatment provides substantial scope for physicians discretion. We use data from 2003 to 2006 from a large database of employer-sponsored health insurance claims and leverage capitation variation within the plan and physician to mitigate selection concerns. The results show that the treatment intensity—primarily derived from therapy and diagnostic testing —of patients under a capitation system is 7–12% lower than that of similar patients in a non-capitated plan. Furthermore, we find no evidence of increased relapse rates for patients in a capitated plan. Keywords: Capitation; Physicians’ behavior; Health insurance (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:80:y:2021:i:c:s0167629621001338 DOI: 10.1016/j.jhealeco.2021.102548 Access Statistics for this article Journal of Health Economics is currently edited by J. P. Newhouse, A. J. Culyer, R. Frank, K. Claxton and T. McGuire More articles in Journal of Health Economics from Elsevier |
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