Health

Paying doctors to keep us healthy

Many physicians say their current fees discourage them from doing their best

Mark Nichols January 31 2000
Health

Paying doctors to keep us healthy

Many physicians say their current fees discourage them from doing their best

Mark Nichols January 31 2000

Paying doctors to keep us healthy

Many physicians say their current fees discourage them from doing their best

Mark Nichols

The winds of change are blowing through the Brentwood Family Practice Clinic in Langley, B.C., about 40 km southeast of Vancouver. As part of a federally backed program promoting alternative forms of health-care delivery, the clinic is about to hire two new nurses and a dietician to help serve some 7,000 patients living in a mix of suburban sprawl and farmland. It is also struggling to transfer patients’ files to a computer-based system. But the biggest revolution at the 25-year-old clinic is a change last September in the way its three family practitioners are paid. Instead of billing the province a fee for each service they provide—the customary payment method for Canadian doctors—Dr. Ray Simkus and his two colleagues are receiving a fixed annual sum for each patient on their lists. Fees vary with age and health—higher for older patients with problems, lower for the young and healthy. “This way,” says Simkus, “we can try to practise preventive medicine—and if patients come in less often, then we can actually make more money.”

Simkus, 48, has always made a point of counselling as well as treating patients. But under the fee-for-service system, he says, “I had a smaller income than doctors who take less time with patients and see them more often. I was penalized for doing what I believe in.” Now, under the new funding formula, Simkus expects his income to increase. Across Canada, many doctors and health-care experts are voicing doubts similar to his about the fee-for-service system that has long been

a cornerstone of Canadian medicine. A widespread complaint is that the system favours cosdy, assembly-line medicine.

As a result, pilot projects are under way in many provinces to determine how well other payment methods work. The program in Langley, says Simkus, offers a way of “making a decent living without doing turnstile medicine.”

In Ontario, talk of reform was in the air last week as the province’s 24,000 physicians began to negotiate a new, three-year contract with the province. Annoyed by reports of some doctors saying they closed their offices on certain days because the province set a ceiling on how much they could earn, Premier Mike Harris threatened to put them on a salary. “Rostering,” said the premier, referring to a program similar to the Langley clinic’s, “is a system that I think will provide better services to patients.” But for all the rhetoric, no one expects the Ontario negotiations to break the Canadian fee-for-service mould. About two-thirds of Canadas 57,000 practising physicians work primarily on a fee-for-service basis. According to Statistics Canada’s latest figures, they earned an average of about $ 116,000 in 1995, after paying their overhead. And some doctors—including highly paid surgeons and physicians who run lucrative, high-volume practices—see no reason to change the way they are paid. “The Harris government may want to push reform,” says Dr. Michael Rachlis, a Toronto-based health-policy analyst.

“And most family physicians want reform, because good physicians are paid poorly under the present system.” But the Ontario Medical Association, which represents the doctors, wants any reform measures to wait at least three years, until pilot projects in the province have run their course.

Medical associations, in fact, tend to resist change, partly because they represent physicians with radically different opinions about how they want to be paid. “Medical associations are like labour unions,” says Dr. Garey Mazowita, a senior official at the Winnipeg Regional Health Authority. “They haven’t led the charge in looking at innovative methods.” And for all the interest in alternative payment systems known variously as rostering and capitation, a core group of doctors remains suspicious of change from the fee-forservice world they know. “There’s a feeling,” says Dr. Mark Heywood, president of the Manitoba Medical Association, “that capitation is a way for governments to claim unlimited work from doctors for limited remuneration.”

But the pressures for change may soon become irresistible. A Canadian Medical Association survey of its 48,000 members last year showed that 67 per

cent—and 72 per cent of those under 35—want something other than feefor-service. “There’s been a groundswell across the country over this,” says Mazowita. “There’s a feeling among doctors that you can’t deliver efficient, cost-effective health care because the system has too many incentives to do the wrong thing. Doctors aren’t saints, and there can be a temptation to stop treating patients as individuals, and just process a lot of them.”

The system is falling into disfavour for other reasons as well. Too often, fee-for-service payments fail to compensate physicians for activities that are an integral part of modern medicine— conferring with other doctors, doing stacks of paperwork and keeping abreast of medical research. And in thinly populated parts of the country where some specialists see relatively few patients, the fee-for-service model can fail to provide enough income to keep doctors on the job. In the face of these pressures, CMA president Dr. Hugh Scully sees the trend towards alternative payment methods continuing. “We don’t think there is a best way of paying doctors,” he told Macleans. “But 10 years from now, I think we will have less feefor-service and more doctors will be on

salaries and other forms of payment.”

Many Canadian physicians are already working under alternative payment systems. They include salaries for doctors in hospitals and other institutions and contracts for physicians in rural areas, as well as lump-sum payments for physicians working occasional hospital shifts. About one-third of Manitoba’s 2,000 physicians are working under non-fee-for-service systems. In British Columbia, nearly a quarter of the 7,500 doctors practise under alternative payment systems, as do 24 per cent of the 1,930 physicians in Nova Scotia, where pilot payment programs are being set up in four communities. “For years, we had a real problem staffing emergency rooms in rural areas,” says Dr. Dan Read, a senior official of the Nova Scotia health department. After putting many hospital physicians on contract and offering cash incentives for some jobs, “that’s not a problem at all any more,” adds Read.

Meanwhile, in a three-year pilot project jointly backed by the Ontario government and the OMA, physicians in seven communities are testing new healthcare delivery and payment models. In Chatham, 80 km east ofWindsor, Dr. Brian Gamble and nine other family

practitioners are setting up an experimental practice aimed at finding a way to encourage doctors to practise in areas where physicians are needed. Patients will agree to receive their basic health care from one of the doctors, or—when that doctor is not available—another member of the group. That is typical of a rostering model in use elsewhere for many years. But in Chatham there is a twist—under a complex payment arrangement, the doctors will still bill for each service according to a formula that provides both a floor and a ceiling. The scheme’s proponents say it is designed to allow doctors to earn a good income while practising effective medicine. “I’m not sure what the best way is to provide high-quality care,” says Gamble. “Maybe we’ll know more when we’ve tried this system.”

Even then, he predicts that the healthcare system and doctors’ payments will not stand still. “It’s like sailing a boat,” says Gamble. “You have to continually adjust for wind and currents.” Just as the health-care system is adjusting now to the dmmbeat of change, the new therapies, fluemating economic realities and emerging diseases of the future will inevitably keep the practice of medicine— and the way physicians are paid—in a state of constant evolution. ED