Selection and exclusion of primary care physicians by managed care organizations

Abstract

Context: Little is known about the problems physicians may be encountering in gaining access to managed care networks and whether the process used by managed care plans to select physicians is discriminatory.

Objective: To investigate the incidence and predictors of denials or terminations of physicians' managed care contracts and the impact these denials and terminations had on primary care physicians' involvement with managed care.

Design: Cross-sectional mail survey of a probability sample of primary care physicians.

Setting: A total of 13 large urban counties in California.

Participants: Primary care physicians (family practice, internal medicine, obstetrics and gynecology, or pediatrics) who work in office-based practice.

Main outcome measures: Denial or termination from a contract with an independent practice association (IPA) or health maintenance organization (HMO) and managed care contracts.

Results: Of the 947 respondents (response rate, 71%), 520 were involved in office-based primary care. After adjusting for sampling and response rate, 22% of primary care physicians had been denied or terminated from a contract with an IPA or HMO, but 87% of office-based primary care physicians had at least 1 IPA or direct HMO contract. Solo practice was the strongest predictor of having experienced a denial or termination and of having neither an IPA nor a direct HMO contract. Physician age, sex, and race did not predict the level of involvement with managed care. However, physicians' patient demographics were associated with managed care participation; physicians in managed care had significantly lower percentages of uninsured and nonwhite patients in their practices. Physicians experiencing a denial or termination had fewer capitated patients in their practice.

Conclusions: Denials and terminations, although relatively common, do not preclude most primary care physicians from participating in managed care. Managed care selective contracting does not appear to be systematically discriminatory based on physician characteristics, but it may be biased against physicians who provide greater amounts of care to the underserved.