Author + information
- Anthony N. DeMaria, MD, FACC1,⁎,
- Thomas H. Lee, MD, FACC*,
- Donald F. Leon, MD, FACC†,
- Daniel J. Ullyot, MD, FACC‡,
- Michael J. Wolk, MD, FACC§,
- Penny S. Mills, MBA∥,
- Sharon C. Fay, MBA∥,
- Joshua H. Brown, JD∥,
- Claudia N. Flatau, MPH∥ and
- David P. Bodycombe, ScD∥
- ↵⁎Address for correspondence: Dr. Anthony N. DeMaria, Professor of Medicine, Chief, Division of Cardiology, University of California at San Diego Medical Center, 200 West Arbor Street, San Diego, California 92103-8411.
Objectives This study was undertaken to determine the extent to which cardiovascular specialists are involved with and affected by managed care and to ascertain their attitudes toward it. This survey also served as the follow-up to an initial study on the subject performed by the American College of Cardiology in 1993.
Background The initial 1993 study was performed to address the lack of any comprehensive examination of the impact of managed care on cardiovascular specialists. In 1995, to reexplore this question and follow up the 1993 findings, the College conducted a survey of its membership in the following areas: 1) physician relationship with managed care plans; 2) number of managed care contracts; 3) breakdown of revenue by payment source; 4) changes in practice in response to managed care; and 5) physician attitudes toward managed care. To the extent feasible, the 1995 questionnaire paralleled the 1993 instrument to facilitate comparisons.
Methods A questionnaire was mailed to 5,147 practicing College members in the United States, who were categorized by specialty as pediatric cardiologists, adult cardiologists or cardiovascular surgeons. Mailings were sent to 1) all pediatric cardiologists and cardiovascular surgeons; 2) randomly selected adult cardiologists practicing in 10 states with high managed care penetration; and 3) randomly selected adult cardiologists in the nine U.S. census areas who were not practicing in the 10 states with high managed care penetration.
Results Usable surveys were returned by 1,236 respondents, for an overall response rate of 24%. Involvement with at least one type of managed care organization was reported by 89% of respondents, up from 76% in 1993. Although managed care relationships had increased across physician age, region, practice and specialty, respondents indicated that, on average, well below 50% of their practice revenues stem from managed care contracts. To adapt to the managed care environment, strategic practice changes, such as joining a cardiovascular network, implementing continuous quality improvement systems and adopting clinical pathways, were being instituted by most respondent practices of nine or more physicians. Smaller groups were less active. Most respondents involved with managed care disliked its effects, particularly in clinical matters. Their attitudes toward the assumption of risk, managed fee-for-service arrangements and a private versus single-payer system show that there is no uniformity of opinion regarding the best means to contain costs and promote efficiency.
Conclusions Managed care has become an established part of cardiovascular specialist practice in the United States. Although this trend is viewed with some disfavor, most respondents are making practice changes to adapt to this new environment.
Few data exist regarding the impact of managed care on the practice of cardiovascular specialists. In 1993 the American College of Cardiology (ACC) undertook a systematic survey of its membership to determine their experience with and attitudes toward managed care (1).
Since 1993, when ~43.7 million Americans were enrolled in health maintenance organizations (HMOs) (ref. 1, p. 1245, footnote 1), managed care has expanded steadily. By the end of 1995, HMO enrollment reached an estimated 58 million and may reach 70 million during 1996 (2). Coverage through preferred provider organizations (PPOs), the other dominant form of managed care, encompassed an estimated 91 million individuals by January 1996 (2). Accordingly, an update on cardiovascular specialists' experience with managed care was needed (Appendix 1).
As noted in the 1993 survey report (ref. 1, p. 1245, footnote 1), previous studies of managed care have focused primarily on cost-effectiveness and public attitudes. More recently, scrutiny has been placed on the quality of health services provided by managed care plans (3). Only modest inquiry has been made into the effect of managed care on providers of specialty care. To gain insight into the ongoing effects of managed care on cardiovascular specialists, an updated survey of ACC members was conducted in 1995. This study compares 1995 and 1993 data on cardiovascular specialists' involvement with, attitudes toward and responses to managed care.
- Abbreviations and Acronymns
- = American College of Cardiology
- = American Medical Association
- = continuous quality improvement
- = health maintenance organization
- = independent practice association
- = managed care organization
- = physician–hospital organization
- = point of service
- = preferred provider organization
Questionnaire design. The questionnaire was a four-page self-administered instrument resembling the 1993 survey to facilitate comparisons. The instrument was pretested on a small number of ACC members and externally reviewed by experts in survey design.* Subjects addressed by the survey were 1) physician relationship to managed care plans; 2) number of managed care contracts held by physician practices; 3) breakdown of practice revenue by payment source; 4) practice changes in response to managed care; and 5) physician attitudes toward managed care. For survey purposes, respondent relationships with HMOs encompassed those maintained through a respondent's independent practice association (IPA). Unlike the 1993 survey, the 1995 instrument solicited information on point of service (POS) plans, which had grown from relative obscurity in 1993 to a noteworthy element of managed care plans by 1995 (ref. 2, p. 5). For the sake of simplicity, information on POS plans is included in data on HMOs and PPOs, unless otherwise indicated.
Sample design. The survey was limited to practicing fellows and associate fellows of the ACC in the United States (n = 14,924, < 1,000 associate fellows). For data development, these members were categorized as follows: 1) pediatric cardiologists, or those designating some type of pediatric specialty (n = 796); 2) cardiovascular surgeons, or those with a surgical specialty (n = 1,252); and 3) adult cardiologists, or all remaining members (n = 12,876). As in 1993, pediatric cardiologists and cardiovascular surgeons were oversampled to obtain a sufficient number of respondents from these specialties. To ensure that enough respondents had sufficient experience with managed care to produce a useful survey result, oversampling of adult cardiologists was again performed in selected states with high managed care penetration.†
The final sample consisted of 5,147 members, as follows: all 1,252 cardiovascular surgeons; all 796 pediatric cardiologists; 2,109 adult cardiologists distributed among the 10 high managed care states; and 990 adult cardiologists spread among the nine U.S. census regions who did not practice in the 10 high managed care states. The nine census regions were grouped into four broad areas (Northeast, Midwest, South and West)t for final data presentation.
Survey execution. Questionnaires were initially mailed in May 1995 and included the definitions attached in Appendix 2. Nonrespondents were targeted by subsequent mailings in September and October 1995. The original methodology called for two mailings (reflecting the 1993 survey methodology), but the third was added to help increase the response rate. To determine how the attitudes of nonrespondents compared to those of responding physicians, a telephone survey of a representative subset of nonrespondents was conducted using a five-point Likert attitude scale.
Data analysis. As in the previous survey, results were adjusted for oversampling in states with higher managed care penetration and weighted to reflect the proportional distribution of the three specialty categories. All significance tests were for Pearson chi-square or one-way analysis of variance. Respondent attitudes toward managed care were measured through a standard five-point Likert scale.
Response rate. The response of adult cardiologists (24.9%) and pediatric cardiologists (25.5%) was roughly equivalent and somewhat higher than that for cardiovascular surgeons (20.9%). By region, adult cardiologists response rates ranged between 22% and 27%. However, no significant difference existed among regions or between adult cardiologists in the states with high managed care penetration (25.3%) and those in other states (23.9%) (p < 0.18).
Physician relationships with managed care, 1993 and 1995. In 1995, 89% of respondents had some relationship with an HMO or PPO compared with 76% who had such a relationship in 1993 (Fig. 1). Sixty-six percent of respondents reported a relationship with two or more types of managed care organizations (MCOs) in 1995, up from 56% in 1993.
In both surveys, the extent of managed care relationships among cardiovascular specialists varied according to selected demographic characteristics. With regard to age, relationships with MCOs in 1995 were maintained by 94% of respondents <50 years old, 86% of those between 51 and 60 years old and 81% of those >61 years old (p < 0.0001); 1993 figures were 85%, 83% and 68%, respectively (p < 0.0001). The extent of involvement with managed care also varied by region (Fig. 2). Cardiovascular specialists in the West were most likely to maintain managed care relationships (95% in 1995 vs. 83% in 1993) compared with those in the Northeast (89% vs. 73%), the Midwest (84% vs. 83%) and the South (86% vs. 74%) (p < 0.001 for 1995 and 1993).
Differences in managed care prevalence were also found by practice setting. Ninety-seven percent of respondents in single-specialty cardiovascular groups had a managed care relationship in 1995 compared with 92% of those in multispecialty groups, 85% of those in university settings and 82% of those in solo practice; 1993 percentages were 84% (cardiovascular), 84% (multispecialty), 73% (university) and 73% (solo practice). Analyzed by specialty, more cardiovascular surgeons (94%) reported relationships with MCOs in 1995 than pediatric cardiologists (92%) or adult cardiologists (88%) (p < 0.12). All percentages were higher than in 1993, when 85% of pediatric cardiologists, 84% of cardiovascular surgeons and 77% of adult cardiologists were involved with managed care (p < 0.04). However, 1995 subspecialty findings did not reach statistical significance.
Number of managed care contracts, 1993 and 1995. From 1993 to 1995, the average number of contracts held by respondent practices with managed care relationships increased from 11 to 12, with the average number of HMO contracts increasing from 4 to 5, and PPO contracts averaging 7 for both years. The number of contracts varied by region (Fig. 3). Respondents in the West reported more managed care contracts than physicians in other areas during 1993 and 1995, although the difference was more evident in PPO than HMO contracts. Western cardiovascular specialists also led their colleagues in POS plan participation, reporting an average of five POS contracts per practice, compared with three for those in the Midwest, three in the South and two in the Northeast.
Revenues from managed care. Among responding cardiovascular specialists, HMOs, PPOs and POS plans accounted for 17%, 9% and 2% of total revenues earned by their practices, respectively (Fig. 4). Medicare fee-for-service receipts constituted >40% of revenues. Looking exclusively at non-Medicare revenue sources, respondents reported that 50% of non-Medicare revenue came from managed care, with HMOs, PPOs and POS plans accounting for 30%, 16% and 4% of the non-Medicare total, respectively. The other half of non-Medicare revenues consisted of payments from private insurance (33%) and fee-for-service Medicaid (11%).*
For all revenue sources (Medicare and non-Medicare), 15% of respondents with HMO or PPO contracts reported that at least half of 1995 practice revenues came from these arrangements. Roughly 25% indicated that such payments accounted for 30% to 49% of revenues, and -60% of these respondents reported that reimbursements from HMOs and PPOs accounted for <30% of practice revenues. These proportions were similar in 1993. The percent of total revenues that cardiovascular specialist practices derived from managed care varied by region (Fig. 5). In 1995, the proportion attributable to managed care ranged from a high of 40% in the West to a low of 19% in the South; 1993 data were similar, although higher in the South (26%). Comparison of 1995 and 1993 data in this instance may be problematic because percentages were solicited differently in 1995 (see later, Study limitations).
Reimbursement arrangements varied by region and type of MCO. Of respondents with PPO contracts, 16% reported their acceptance of package-pricing arrangements, but most accepted PPO reimbursement in the form of fee schedules (85% in 1995, 90% in 1993) and discounted charges (76% in 1995, 82% in 1993). On average, specialty capitation by HMOs was accepted by approximately one-third of respondents, although its prevalence differed regionally. Of adult cardiologists! with HMO relationships, 42% of those in the West reported capitated payment compared with 36% in the Midwest, 35% in the South and 23% in the Northeast.
The extent of financial incentives to conserve medical resources also varied by region and type of MCO. Of all respondents with HMO contracts, 50% accepted risk sharing in 1995, a slight decrease from 56% in 1993. Other HMO incentives were bonus sharing (cited by 20% in 1995 and 33% in 1993) and stock ownership (experienced by 10% in 1995 and 12% in 1993). The use of risk-based financial incentives was much less common in respondents' relationships with PPOs. As noted above, only a fraction of respondents with PPO contracts reported their acceptance of package-pricing arrangements in either 1993 or 1995. Most accepted nonrisk fee-for-service reimbursement, such as discounted charges and fee schedules.
Changes in physician practice in response to managed care. In 1995, 17% of responding cardiovascular specialists indicated that their practice had joined a cardiovascular network; 21% served as the exclusive provider of cardiovascular services for an HMO or PPO (vs. 18% in 1993) and -7% of practices had contracted directly with an employer (unchanged from 1993). In 1995, the adoption of these strategies, as well as several others, varied by the size of the respondents' practices (Fig. 6). Clinical pathways were instituted by 66% of large groups (defined as nine or more physicians) but only by 24% of small practices (one or two physicians). A clinical data collection system was implemented by 64% of large groups but only by 17% of small practices. Respective percentages for other initiatives for large and small groups included the following: began monitoring outcomes of care, 72% and 31%; instituted system of continuous quality improvement (CQI), 64% and 32%; joined, formed or increased group size, 78% and 18%; increased number of managed care contracts, 76% and 52%; and decreased practice costs to become more efficient, 72% and 54% (p < 0.001 for each). Values for medium-sized groups tended to be intermediate (Fig. 6). Viewed regionally, respondent practices in the Northeast had the lowest tendency to adopt these strategic responses (aside from joining, forming or increasing group size), whereas those in the West, Midwest and South were more likely to do so (p < 0.001 to 0.006). Of those respondent practices electing to decrease costs to improve efficiency, 73% had experienced a decrease or leveling off of income compared with 27% reporting an increase in practice income.
Respondent attitudes toward managed care. The attitudes of cardiovascular specialists toward managed care were examined through their responses to several statements concerning health care delivery and practice under managed care (Table 1).
The survey included several questions concerning access to specialty care and services. Approximately 60% of 1995 respondents disagreed with the statement that “primary care providers appropriately serve as managed care gatekeepers,” compared with 36% in 1993 (p < 0.0001) (Fig. 7). In 1995, nearly 70% disagreed with the statement that “the primary care gatekeeper system works well for patients with cardiovascular emergencies,” up from 56% in 1993 (p < 0.0001) (Fig. 8). Cross tabulation of these two questions revealed that 55% of respondents who disagreed that primary care physicians are appropriate gatekeepers agreed that the timing of (or need for) gatekeeper referrals jeopardized their patients' safety. Regarding the use of formularies, ∼44% of 1995 respondents disagreed with the statement that “managed care formularies have not affected my ability to prescribe appropriate drugs for patients,” up from 32% in 1993.
Cardiovascular specialists generally took a negative view of managed care's effect on referrals and professional income. Just 16% of 1995 respondents agreed that “the growth in managed care plans has increased the number of new referrals I receive,” whereas 60% disagreed; 1993 results were similar. Fifty-seven percent of 1995 respondents agreed that “managed care arrangements have reduced my annual professional income” compared with 52% in 1993. In 1995,57% of physicians disagreed that “utilization review requirements of HMOs and PPOs are less burdensome than those of Medicare carriers,” an increase from ~48% in 1993.
The sentiments of cardiovascular specialists regarding their involvement in the development and use of clinical pathways by payers or hospitals, or both, varied by the size of their practice. Forty-two percent of those in large practices (nine or more physicians) agreed that they were given effective involvement compared with 21% of those in small groups (one to two physicians). Fifty-three percent of respondents in small practices felt that they were not adequately involved compared with 38% of those in large groups.
In terms of the health care system generally, respondents involved with managed care were divided regarding their preference for assuming financial risk (but retaining autonomy) versus being reimbursed via fee-for-service (and having to justify care to a third party). These respondents were also divided over their preference for a national “single-payer” system (similar to Medicare) versus a private system influenced by managed care plans. Regarding physician supply, >50% of all respondents ≤55 years old felt that the ACC should place a high priority on decreasing the number of training programs or fellows (or both) compared with 39% of those ≥56 years old.
Attitudes of nonrespondents. Of the 176 nonrespondents surveyed, 130 had no recollection of receiving the questionnaire, and most others regarded the 4-page, 40-question document as too complicated to complete or were too busy to do so. Results indicated that nonrespondents viewed managed care more negatively than did responding physicians.
The results of this survey demonstrate that the great majority (89%) of responding cardiovascular specialists now have some relationship with managed care, and the trend toward such relationships is increasing. Moreover, among those cardiovascular specialists with managed care relationships, the number of contracts held by their practices is on the rise. An increase in administrative needs and expenses may be anticipated. Whether the number of contracts will continue increasing is unclear because ongoing market consolidation may result in fewer health plans and thus fewer (albeit more comprehensive) contracts. In any event, survey results strongly suggest that managed care has become an established part of cardiovascular specialty practice and that participation in managed care contracts is now the rule rather than the exception.
The trend toward cardiovascular specialist participation in managed care parallels that among physicians in general. According to a recent American Medical Association (AMA) study, in 1994 to 1995, ∼84% of U.S. medical groups of three or more physicians maintained at least one HMO or PPO contract (4). For specialists, HMO contracts were held by 80% of single-specialty groups and 87% of multispecialty groups, and PPO arrangements were maintained by 82% and 91%, respectively (4). These and other AMA findings (5) demonstrate a consistent increase in managed care contracting.*
The ACC survey findings also showed that managed care penetration was highest among cardiovascular specialists in the West, with 95% of respondents reporting some managed care relationship in 1995. Western cardiovascular specialists also reported the highest number of managed care contracts, with a remarkable average of 21 HMO or PPO contracts per respondent practice. Although the percentage of respondents in the Northeast with managed care relationships approached that of the West, Northeastern practices held significantly fewer contracts. In fact, respondents in the Northeast reported fewer contracts than their counterparts in the Midwest, who had the lowest percentage of managed care relationships. One explanation for this finding may be greater consolidation of the managed care market in the Northeast than the Midwest. As of May 1996, both regions had a similar number of HMO enrollees in their metropolitan areas (Northeast 11.6 million vs. Midwest 10 million), but the Northeast had one-third fewer HMOs (102 vs. 167, respectively) (6). The Midwest was also the only region where the percentage of respondents with managed care relationships did not significantly increase from 1993 (83%) to 1995 (84%). This finding may reflect the fact that > 50% of the increase in HMO enrollment during 1994 occurred in five states (California, New York, Florida, Pennsylvania and Texas) located in regions outside the Midwest (7). However, the number of contracts per specialist practice over all regions suggests that MCOs routinely contract with more than one physician group for the same services, and vice-versa.
The overall increase in managed care relationships was evident in the sampling of cardiovascular specialists by practice setting. All practice types reported an increase from 1993 to 1995. Respondents in single-specialty cardiovascular group practices experienced the greatest increase in managed care arrangements, from 84% in 1993 to 97% in 1995. This increase may stem from a growing tendency of MCOs to contract with these groups for provision of the full spectrum of cardiovascular care for large numbers of their members. Solo practitioners had among the lowest percentage of managed care relationships.
With respect to respondent age, younger cardiovascular specialists were more likely to engage in managed care relationships than their older colleagues. Older physicians may be less likely to pursue these relationships because their practices are well established, or their attitudes are less favorable to managed care, or both. However, the percentage of physicians > 61 years old with managed care relationships has increased substantially, from 68% in 1993 to 81% in 1995. In addition to the absolute growth in such relationships, this increase may stem in part from aging of the respondent population into the “over 61” category. The greater tendency of younger physicians to do business with managed care plans may stem, in part, from their exposure to and familiarity with this delivery system during medical school and residency training. Managed care may also constitute the primary patient source for physicians entering practice with single- or multispecialty groups and their affiliated networks. However, those entering solo practice may experience greater difficulty contracting with managed care plans because 1) many plans may have already filled their specialist panels; 2) demand for specialty services may be decreasing; and 3) new physicians have little history of clinical care patterns, which MCOs often use in deciding whether to admit practitioners to their panels.
Despite the rapid expansion of managed care, payments from MCOs constituted a relatively low portion of respondent practice revenues during 1993 and 1995. Less than 15% of practices with HMO or PPO contracts obtained a majority of revenue from these sources, and MCO contracts accounted for less than one-third of total revenue for 60% of practices. A recent Medical Economics survey (8) found comparable results for physicians generally; only 15% to 20% of 1994 gross physician revenues were attributable to HMO contracts, and 12% to 15% to PPO payments. It remains unclear whether managed care arrangements account for a small percentage of total revenues because they represent a small volume of patients, or because reimbursement or utilization is reduced for any given service.
Still, the proportion of revenues stemming from managed care may be poised to increase, at least for the practices of adult cardiologists and cardiovascular surgeons. Respondents to the ACC survey indicated that in 1995, >40% of their practice revenues were attributable to Medicare fee-for-service payments. As enrollment in Medicare HMOs grows, Medicare fee-for-service revenues will decline, and a larger proportion of practice revenue will come from managed care.*
Financial incentives for cost containment are often included in managed care contracts. These incentives can take the form of risk sharing (e.g., fee-for-service withholds), bonus sharing and stock ownership. Risk sharing and bonus sharing appeared to be the most common incentive among cardiovascular specialists' HMO contracts, but not their PPO agreements. A recent survey reported in The New England Journal of Medicine (9) found that whereas 54% of IPA or network HMOs used risk-sharing arrangements with specialists, very few PPOs followed suit. The percentage of ACC respondents accepting financial incentives declined noticeably from 1993 to 1995, perhaps reflecting cardiovascular specialist concerns that such incentives could compromise the quality of care.
Most responding cardiovascular specialists did not accept capitated payment. This finding is reflected by a recent Inter-Study report (10), which found that nationally, only 20% of HMO reimbursement to specialists was through capitation compared with 52% through fee-for-service, 14% through relative value scales, 3% through salary and 9% through other HMO reimbursement arrangements. However, in its “Pacific” region, Inter-Study reported (ref. 6, pp. 3,21,31,41,51, 61,71, 81, 91) that the percentage of capitated specialty services was nearly twice that of any other area. Data also show that 45% of HMO reimbursement to primary care physicians is now through capitation (ref. 10, p. 81). Apparently, the trend toward capitation of primary care providers is not greatly affecting specialist reimbursement beyond the West Coast.
Cardiovascular specialists are changing their practices to adapt to the new managed care environment. In addition to moves such as mergers, decreasing practice costs and increasing the number of managed care contracts, physician practices are adopting systems for continuous quality improvement, outcomes monitoring, clinical data collection and clinical pathway development. Such maneuvers clearly involve additional costs. Findings showed that larger respondent groups were more likely to implement changes than smaller groups. Several explanations are possible: 1) Larger groups may have more financial and personnel resources to undertake these changes than smaller groups; 2) large practices may be more difficult to operate and manage without these adaptations, necessitating their more frequent use; 3) larger practices may have sufficient numbers of patients to accept capitated reimbursement, and the resulting assumption of risk for the cost of care creates a strong incentive to reduce costs and increase efficiency. Smaller practices, which may lack enough patients to attempt capitated reimbursement, may have less incentive to adopt cost-reduction and efficiency-promoting changes. 4) Larger practices have greater market leverage than smaller groups. As a result, they may bargain more successfully with managed care organizations for participation in the design and implementation of these changes. Indeed, the survey found that more physicians in large groups agreed that they were effectively involved in payer (and hospital) development and use of clinical pathways than those in smaller practices.
The regional variations in adoption of CQI, data collection, outcomes monitoring and clinical pathways may be a reflection of different market characteristics. For example, respondent practices were most likely to implement these strategies in the Midwest, followed by the West, South and Northeast. One reason may be that in the Midwest (particularly Minnesota, Illinois and Ohio), the development of health care purchasing coalitions has been particularly intense. Because these purchasers seek measures of quality and cost-effective care, MCOs and their affiliated physician groups in the Midwest may be undertaking slightly more data collection and quality initiatives than their counterparts in other regions. Although health care purchasing coalitions and large employers in all markets are scrutinizing the quality of care, metropolitan areas of the Midwest are often regarded as leaders in this trend.†
Other studies provide insight into specialist practice adaptations in response to managed care. A recent Medical Economics survey (11) found that 19% of cardiologists have merged their practices (the highest percentage of any specialty surveyed); 5% have joined a “group practice without walls“; 19% have affiliated with a physician-hospital organization (PHO); 5% have joined a management service organization (MSO); and 14% have entered a physician organization (PO). According to the AMA's 1996 survey of practice characteristics (ref. 4, p. 33), 37% of single-specialty groups and 39% of multispecialty groups joined physician-hospital organizations (PHOs). The AMA data also indicate (12) that between 1983 and 1994, the proportion of patient care physicians practicing as employees (i.e., no ownership in their practice) rose from 24% to 42%, the proportion self-employed in solo practices fell from 40% to 29%, and the proportion self-employed in group practices fell from 35% to 28%.
Although most cardiovascular specialists are attempting to adapt to managed care, the ACC surveys reflect their dissatisfaction with its effects. Increased concern was most evident with regard to the effect on clinical care. A majority of respondents reported that managed care has adverselyaffected their patient relationships and felt that primary care physicians did not perform adequately as gatekeepers for patients with cardiovascular illness. Most respondents also indicated that gatekeeping arrangements were inadequate to serve patients with cardiovascular emergencies. Although physicians were divided over whether managed care formularies affected their ability to prescribe appropriate drugs, more physicians agreed that this ability had been more adversely affected in 1995 than in 1993. The utilization review performed by managed care plans was perceived as more burdensome than those of traditional Medicare carriers.
The limitations and inadequacies of managed care cited by cardiovascular specialists contrast with other studies that reported evidence of quality care and patient satisfaction with such systems (e.g., study by KPMG Peat Marwick , which examined data from 1,300 U.S. hospitals to assess the effects of managed care competition on the practices and outcomes of providers; Miller and Luft , who analyzed published reports on the performance of managed care plans versus fee-for-service plans; and Carlisle et al. ). Although these negative impressions may reflect the perspective of the specialists, the earlier 1993 survey did not detect dissatisfaction to the same extent. It is possible that the limitations inherent in managed care systems become apparent with greater involvement. Alternatively, because specialists typically see patients with greater acuity of illness, these data are compatible with the concept that managed care may be more problematic when applied to patients with advanced disease. As with all surveys, a certain degree of subjectivity exists.
Results from this study also signaled growing discontent with the referral and income limitations of managed care. A majority of physicians stated that managed care had reduced their incomes, and more respondents held this view in 1995 than 1993. Recent AMA figures corroborate this finding, reporting a general decline in physician incomes during 1993 to 1994 (16). Although one of the primary incentives for entering into managed care contracts is to increase or maintain patient volume, most respondents disagreed that the growth in managed care plans had increased their referrals. This perception may have influenced the attitudes of cardiovascular specialists toward gatekeepers, because gatekeepers may be seen as the agents through which managed care limits referrals. Overall, therefore, respondents indicated that managed care appeared to increase the administrative burden for cardiovascular specialists without increasing quality of care or patient volume.
Cardiovascular specialists with managed care relationships were divided over their preference for assumption of risk, managed fee-for-service payment and a private versus public health care system. These results suggest that despite physician misgivings about managed care, disagreement exists regarding the ideal shape of the health care system and the best means of containing costs and promoting efficiency. However, among all respondents, attitudes concerning managed care's effect on growing competition among physicians is evident in that most new physicians and those in midpractice believe the ACC should place a high priority on reducing the number of cardiovascular training programs and fellows.
Study limitations. The 1995 survey has several limitations:
1. The survey may not fully represent the views of practicing cardiovascular specialists. The sample population targeted only a portion of the active membership of the ACC, and the ACC represents only a portion of the total population of cardiovascular specialists in the United States. This relatively small sample size limited the survey's ability to undertake detailed geographic subanalyses. Still, cardiovascular specialists are selected for membership in the ACC on the basis of their demonstrated proficiency in the discipline.*
2. The 24% survey response rate was low. Survey results may be biased toward physicians with more interest in health care delivery trends or with more familiarity or stronger feelings toward managed care. However, the survey of nonrespondents indicated that physicians who failed to respond to the mailed questionnaire had comparable, if not more negative, attitudes toward managed care than those who did respond. Accordingly, these data support the contention that the 24% response rate should not compromise the reliability and validity of the survey results.
3. The survey instrument was sometimes felt to be ambiguous in requesting data concerning individual respondents as opposed to their practice group. As a result, information obtained may be more reflective of an entire practice rather than an individual physician, and vice-versa. In this regard, all the limitations of a mailed survey, as opposed to a telephone or direct interview survey, apply.
4. The 1993 and 1995 surveys occasionally asked similar questions in different ways, which may have affected the comparability of data from each year. For example, comparisons regarding revenues from managed care may have limited value, because respondents in 1993 were asked to estimate the percent of revenue stemming from HMOs in one question and PPOs in another. The 1995 instrument requested this information as a percentage breakdown of all revenue sources. Respondents in 1993 may have overestimated the percent of their revenue from HMOs and PPOs when considering them separately.
5. The two surveys differed in their selection of states with high managed care penetration for sampling purposes. Due to changes in the market, Florida and Missouri were added to the list, whereas Michigan was deleted. In addition to shifting the sample population, this modification affected the composition of respondents in regions from which these states were selected (i.e., South Atlantic, West North Central and East North Central).
6. The inclusion of POS data in the 1995 survey results may affect comparisons with 1993 findings.
Conclusions. The results of the present survey demonstrated that managed care has become an established part of cardiovascular specialist practice in the United States. Nearly nine-tenths of responding physicians had some managed care relationship, up from roughly three-quarters in 1993. Furthermore, the majority of cardiovascular specialists are adopting adaptive practice strategies to enhance their success in the new managed care environment.
Despite the widespread involvement of cardiovascular specialists with managed care, payments from HMOs, PPOs and other forms of MCOs still constitute a relatively modest share of total practice revenues. Whether this situation will change dramatically over the next few years is unclear. However, if managed care continues to enroll increasing numbers of patients, including Medicare beneficiaries, an increasing proportion of cardiovascular practice revenues will come from managed care.
Most cardiovascular specialists have strong concerns about managed care. There are concerns regarding gatekeeper systems, constraints on clinical decision making, administrative burdens and declining reimbursement. Yet, examination of respondent attitudes toward the assumption of risk, managed fee-for-service arrangements and a private versus single-payer system show that there is no uniformity of opinion regarding the best means to contain costs and promote efficiency.
The effect of managed care on cardiovascular specialist practice has increased notably since the ACC's first membership survey in 1993, and this trend is likely to continue. Future public acceptance of managed care depends on its demonstration that expected benefits are provided at reasonable costs.
External review of the draft manuscript was performed by Harold Luft, PhD, Institute for Health Policy Studies (University of California at San Francisco) and Allyson Ross Davies, PhD, Consultant (Newton, Massachusetts).
The impetus for this study came from the American College of Cardiology Private Sector Relations Committee, which includes the following: Daniel J. Ullyot, MD, FACC, Chair, Surgical Department, University of California at San Francisco Medical Center, San Francisco, California; Ralph G. Brindis, MD, FACC, Coronary Care Unit, University of California at San Francisco Medical Center, San Francisco, California; Anthony N. DeMaria, MD, FACC, Division of Cardiology, Department of Medicine, University of California at San Diego Medical Center, San Diego, California; Paul L. Douglass, MD, FACC, Metropolitan Atlanta Cardiology Consultants, Atlanta, Georgia; Joseph R. Drozda, MD, FACC, St. Louis Health Care Network, St. Louis, Missouri; Joel M. Gore, MD, FACC, Division of Cardiology, University of Massachusetts Medical School, Worcester, Massachusetts; O. Wayne Isom, MD, FACC, Department of Cardiothoracic Surgery, New York Hospital-Cornell Medical Center, New York, New York; Thomas H. Lee, MD, FACC, Partners Community Healthcare, Inc. (Brigham & Women's Hospital), Boston, Massachusetts; Donald F. Leon, MD, FACC, Georgetown University Medical Center, Washington, District of Columbia; Joseph V. Messer, MD, FACC, St. Luke's Medical Center, Chicago, Illinois; John A. Murray, MD, FACC, Veterans Administration, Anchorage, Alaska; David B. Pryor MD FACC, Allina Health System, Minnetonka, Minnesota; Gregory S. Thomas, MD, FACC, Mission Internal Medical Group, Mission Viejo, California; August M. Watanabe, MD, FACC, Eli Lilly & Company, Indianapolis, Indiana; Roberta G. Williams, MD, FACC, Department of Pediatrics, University of North Carolina School of Medicine, Chapel Hill, North Carolina; W. Bruce Fye, MD, FACC, Ex-Officio, Cardiology Department, Marshfield Clinic, Marshfield, Wisconsin.
Managed Care Definitions
The following definitions were used in the survey to describe different managed care organizations, reimbursement methods, financial incentive arrangements and utilization and care management techniques.
Health maintenance organization (HMO): An organization that offers a comprehensive set of health benefits on a prepaid basis. Unlike traditional insurance, HMOs provide services directly to patients either by employing or contracting with physicians, hospitals and other providers.
Independent practice association (IPA): An association of independent physicians who provide services to HMO members through an arrangement negotiated between the IPA and the HMO. IPA physicians maintain their own offices while contracting with one or more managed care plans.
Preferred provider organization (PPO): A network of physicians, hospitals and other providers who contract with an insurer, third-party administrator or other sponsoring group to provide health care services for a negotiated payment level. Patients are offered enhanced benefits if they see network providers but are free to see nonnetwork providers at a higher out-of-pocket cost (e.g., increased deductibles and coinsurance).
Point-of-service (POS) plan: Sometimes referred to as “open-ended HMOs,” these plans enroll beneficiaries (as in an HMO) and use a network of contracted providers. However, enrollees may elect to receive care from providers outside the network at a higher out-of-pocket cost (as in a PPO).
Capitation: A per-member, per-month fixed payment to a physician for each member enrolled, regardless of the amount of care a member receives. The capitation may cover a range of primary care services (primary care capitation) or a range of specialty care services (specialty capitation).
Discounted charges: Physician agrees to accept a predetermined percentage discount off charges (e.g., 20%).
Fee schedule: Negotiated payment based on a relative value scale (RVS) (e.g., Medicare RBRVS, McGraw-Hill RVS or others) or the usual customary fees charged in a particular community.
Package price per episode: A single fee for a procedure such as coronary artery bypass graft surgery, where facility, physician and ancillary fees are bundled into a single payment.
Financial Incentive Arrangements
Bonus sharing: Additional funds received by participating physicians at the end of the year if certain medical costs or utilization levels are lower than original budgets.
Risk sharing: Physician shares the financial risk for certain medical costs with the health plan or with other participating providers. Typically, a portion of the physician's fees are withheld until the end of the year. The amount withheld is only returned if actual medical costs or utilization levels are lower than the predetermined goals.
Utilization and Care Management Techniques
Critical (clinical) pathways: A plan that maps the patient care process from before admission through discharge in an attempt to ensure that patients are cared for in the most efficient and efficacious way possible.
Practice guidelines: Systematically developed statements to assist practitioner and patient decisions about appropriate health care for specific clinical circumstances.
This research was solely supported by the American College of Cardiology, Bethesda, Maryland
- American College of Cardiology
- DeMaria AN,
- Engle MA,
- Harrison DC
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