Managed care and capitation in California, how do physicians at financial risk control their own utilization?

by Eve A. Kerr, Brian Mittman, Ron D. Hays, Albert L. Siu, Barbara Leake, Robert H. Brook

All physician groups reported using gatekeeping and preauthorization for certain referrals or tests. Most also used profiling of utilization patterns (79%), guidelines (70%), and managed care education (69%). Most physician groups asked gatekeepers to submit preauthorization requests for specialty referrals and restricted patient self-referral. For example, 60% of groups required preauthorization for an internal medicine subspecialty referral, and 7% allowed patient self-referral. Most groups also asked gatekeepers to obtain preauthoirzation for many tests (for example, 95% for magnetic resonance imaging and 53% for pulmonary function tests). Preauthorization requests were denied infrequently (less than 10% of the time) by more than 75% of groups. Of the 54 groups reporting utilization profiles to their physicians, 61% never adjusted for case-mix among patients and more than 60% suggested practice changes to their physicians based on utilization. Fewer than 35% of the groups used written guidelines for expensive tests that required preauthorization (such as angiography).

Originally published in: Annals of Internal Medicine, v. 123, no. 7, October 1, 1995, pp. 500-504.

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