PRACTICE OBSERVED Changing remuneration systems: effects on activity in general practice

Br Medj7 1990;300:1698-701 Abstract Objective-To investigate the effects on general practitioners' activities of a change in their remuneration from a capitation based system to a mixed fee per item and capitation based system. Design-Follow up study with data collected from contact sheets completed by general practitioners in one period before (March 1987) a change in their remuneration system and two periods after (March 1988, November 1988), with a control group of general practitioners with a mixed fee per item and capitation based system throughout. Setting-General practices in Copenhagen city (index group) and Copenhagen county (control group). -Subjects-265 General practitioners in Copenhagen city, of whom 100 were selected randomly from the 130 who agreed to participate (10 exclusions) and 326 general practitioners in Copenhagen county. Main outcome measures-Number of consultations (face to face and by telephone) and renewals of prescriptions, diagnostic and curative services, and specialist and hospital referrals per 1000 enlisted patients in one week. Results-Of the 75 general practitioners who completed all three sheets, four were excluded for incomplete data. Total contact rates per 1000 patients listed rose significantly compared with the rates before the change index in the city (100-0 before the change v 111-7 (95% confidence interval 106-4 to 117-4 after the change) and over the same time in the control group (100.0 v 106-0), but within a year these rates fell (to 104-2 (991to 109-6) and 104-0 respectively). There was an increase in consultations by telephone initially but not thereafter. Rates of examinations and treatments that attracted specific additional remuneration after the change rose significantly compared with those before (diagnostic services, 138-1 (118-7 to 160-5) and 159-5 (137-8 to 184-7) and curative services 194-6 (152-2 to 248.9) and 194-8 (152-3 to 249-2) for second and third data collections respectively) and with the control group (diagnostic services 105-3, 107*6 and curative services 106-0, 115-0) whereas referral rates to secondary care fell (specialist referrals 90-1 (80-7 to 100-6) and 77-0 (68-6 to 86.4) and hospital referrals 87-4 (71-1 to 107-5) and 68-4 (54.7 to 85.4)) in doctors in the city. Conclusions-Introducing a partial fee for service system seemed to stimulate the provision of services by general practitioners, resulting in reduced referral rates. The concept of a "target income" which doctors aim at, rather than maximising their income seemed to play a part in adjustment to changing the system of remuneration. Introduction How best to pay doctors, especially general practitioners, has been the subject of considerable debate. Yet as Donaldson and Gerard indicated, "There is little evidence about the effect of different methods of payment on doctors' performance."' This study examines the activities of a sample of general practitioners in the city of Copenhagen when they were remunerated on a capitation basis and again in two separate periods after October 1987 when they were paid on a part fee per item basis and part capitation basis. The county ofCopenhagen surrounding the city, where the system was partly fee per item and partly capitation throughout, was used as a control.