Data on efficiency, costs, and profits of 15 internal medicine outpatient group practices in university hospitals were collected for 9 months from interviews, a time-motion study, observations, and reviews of bills. Charges for a follow-up visit were about 25% higher than Medicare's allowable charges, but differed threefold across practices. Physicians spent more than half their allocated patient care or supervision time in other activities and 14% of nursing time was used for direct patient care. Visits to second- and third-year residents cost one half of those to faculty. Faculty supervision of second- and third-year residents was limited; it was, on average, 2 minutes per follow-up visit. Despite these inefficiencies, bad debts, and educational costs, practices appeared to break even financially. We conclude it is financially feasible for university hospitals to provide primary care to disadvantaged populations.
This report is part of the RAND Corporation External publication series. Many RAND studies are published in peer-reviewed scholarly journals, as chapters in commercial books, or as documents published by other organizations.
Our mission to help improve policy and decisionmaking through research and analysis is enabled through our core values of quality and objectivity and our unwavering commitment to the highest level of integrity and ethical behavior. To help ensure our research and analysis are rigorous, objective, and nonpartisan, we subject our research publications to a robust and exacting quality-assurance process; avoid both the appearance and reality of financial and other conflicts of interest through staff training, project screening, and a policy of mandatory disclosure; and pursue transparency in our research engagements through our commitment to the open publication of our research findings and recommendations, disclosure of the source of funding of published research, and policies to ensure intellectual independence. For more information, visit www.rand.org/about/research-integrity.
The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.