Medicare: Physician Incentive Payments by Prepaid Health Plans Could Lower Quality of Care
HRD-89-29
Published: Dec 12, 1988. Publicly Released: Dec 12, 1988.
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Highlights
Pursuant to a congressional request, GAO evaluated various types of physician incentive plans that health maintenance organizations (HMO) offered to control health insurance costs, focusing on the: (1) potential of these incentives to result in inappropriate service reductions; and (2) characteristics of those incentives posing the greatest risk to quality of care for Medicare beneficiaries.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| If the Health Subcommittee, House Committee on Ways and Means, considers modifications to Medicare to permit certain HMO physician incentive payments, it may wish to retain a ban on arrangements that closely link financial rewards with individual treatment decisions or expose the primary care physician to substantial financial risk for services provided by physicians or institutions to whom he or she refers patients for diagnosis or treatment. |
Closed – Implemented
|
The Omnibus Budget Reconciliation Act of 1990 prohibits Medicare from contracting with HMO whose physician payment plans induce physicians to withhold necessary services or place physicians at substantial financial risk for services furnished by other providers. |
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Topics
Capitation (medical care)Employee incentivesHealth care costsHealth care servicesHealth insurance cost controlHealth maintenance organizationsMedicarePhysiciansQuality assuranceSalary increasesQuality of care