Quality and Quantity in Primary Care Mixed Payment Models: Evidence from Family Health Organizations in Ontario

We study the impact of a mixed capitation model known as the Family Health Organization (FHO) on selected quality and quantity outcomes relative to an enhanced fee-for-service model known as the Family Health Group (FHG) among primary care physicians in Ontario, Canada. Using a panel of administrative data that covers one year before and two years after the FHO model was introduced in 2007, we find that physicians in the FHO model provide about 6 percent fewer services and visits per day, but are between 8 and 15 percent more likely to achieve preventive care bonuses for senior flu shots, toddler immunizations, pap smears, and mammograms compared to physicians in the FHG model. These results are largely consistent with the hypothesis that the mixed payment model may reduce quantity and improve quality of health care relative to the fee-for-service model. We also find that the FHO physicians have lower referral rates and enroll patients of similar complexity compared to the FHG physicians.