Copayments for physician visits

• Abstract
• Characteristics of this policy
• Purpose and process analysis
• Expected outcome
• References

Abstract

The second phase of the evaluation estimated the effect of charging copayments for specialist visits on visit rates of exempt and non-exempt populations in 1997-2002. Using administrative data for a random sample of members, we found that in two health plans, the exempt have decreased their visit rates relative to the non-exempt for all types of specialist visits, but in the third only for specialists where a referral is needed. Implications for quality of care and equity are discussed.

Neue Entwicklungen

Innovationsgrad	traditionell		innovativ
Kontroversität	unumstritten		kontrovers
Strukturelle Wirkung	marginal		fundamental
Medienpräsenz	sehr gering		sehr hoch
Übertragbarkeit	sehr systemabhängig		systemneutral
current    previous

Innovation: The policy tool of cost sharing is not new, and has been used widely in Israel and abroad. Copayments for medications and other services existed long before these additional copayments were instituted.  In one health plan (Maccabi), copayments for physician visits were already being collected before 1998. However, the broad scale  exemptions and discounts (without compensation to the health plans) are relatively innovative, compared to other systems.

Consensus: As described above, this policy was and still is very controversial. Debate surfaces periodically in policy forums.

Systemic impact: The policy constituted a significant change; in three of the four health plans no copayments were formerly charged for visits to specialists. The new evaluation data indicate that the systemic impact may be even more fundamental with several supply side effects: since the copayments provide additional revenue to the sick funds, they constitute an incentive to increase access and availability of specialists in order to increase visit rates and collect more revenue. Thus, instead of decreasing unnecessary visits they may in fact increase unnecessary visits. Furthermore, since the poor are exempted from copayments, health plans may have an incentive to develop specialist services mainly in more wealthy areas. This adds to other incentives Health Plans have to prefer the wealthy: e.g. they buy supplemental insurance, they buy services not provided by the NHI benefits package, they have relatively better health status. Finally,  the exemptions are granted automatically, based on a member's exemption status, which appears in the health plan's computer system. Thus, the health plans can potentially use the data when setting appointments for specialists, and could postpone visits for those members who do not pay a copayment for the visit. If this happens, the exemptions which were meant to safeguard vulnerable populations may in fact provide the health plans with a tool to discriminate against them. However, it is important to stress that there is no evidence that Health Plans use the data for this end.

Visibility: The media raises the issue sporadically, however attention focuses mainly on copayments for medications, which pose greater financial burdens on households. 

Transferability: Copayments as a policy tool may be transferred easily; however, the specific exemptions and discounts are highly context-dependent (related in Israel to the welfare system).

Purpose and process analysis

Current Process Stages

	Idee	Pilotprojekt	Strategiepapier	Gesetzgebung	Umsetzung	Evaluation	Veränderung/Richtungswechsel
Implemented in this survey?

Initiators of idea/main actors

• Regierung

• Leistungserbringer

• Patienten, Verbraucher

• Wissenschaft

• Medien

Stakeholder positions

Preliminary informal position towards new development (i.e. results of the evaluation)

Health plans: The health plans express moderate surprise that the data show a relative decrease in visits to specialists among exempt patients, as well as moderate surprise that exempt members (as well as other low-income members) have longer waiting times for specialists.  They deny that they have a policy of preferring the non-exempt members in their appointment systems. 

Ministry of Health: Some professionals are aware of the possible negative incentives to health plans in an exemption system that does not compensate the provider for exemptions.  This may reflect the health plans' preference for high socio-economic members, who buy supplemental insurance and have fewer health needs in general. 

Ministry of Finance:  Have not responded yet to the evaluation findings. In the past expressed interest in the overall effect of copayments on visit rates, and have expressed less concern regarding implications for equity.

Academia: Academics are aware of the possible negative incentives to health plans in an exemption system that does not compensate providers for exemptions.  Some believe that health plans seeking revenue may systematically discriminate against the exempt in their appointment system.  Another explanation given is that the health plans prefer to develop services in wealthy neighborhoods, in order to attract high socio-economic members, who buy supplemental insurance and have fewer health needs in general.  Others note that the relative decrease in the visitation rates of exempt populations may be attributed to their preferences or lack of knowledge that they are exempt.

Actors and positions

Regierung
Ministry of finance	sehr unterstützend		stark dagegen
Ministry of health	sehr unterstützend		stark dagegen
Leistungserbringer
Health Plans	sehr unterstützend		stark dagegen
Patienten, Verbraucher
patients	sehr unterstützend		stark dagegen
Zvi patient advocacy group	sehr unterstützend		stark dagegen
Wissenschaft
health policy researchers	sehr unterstützend		stark dagegen
Medien
media	sehr unterstützend		stark dagegen
current    previous

Influences in policy making and legislation

Not relevant

Legislative outcome

n/a

Actors and influence

Regierung
Ministry of finance	sehr groß		kein
Ministry of health	sehr groß		kein
Leistungserbringer
Health Plans	sehr groß		kein
Patienten, Verbraucher
patients	sehr groß		kein
Zvi patient advocacy group	sehr groß		kein
Wissenschaft
health policy researchers	sehr groß		kein
Medien
media	sehr groß		kein
current    previous

Positions and Influences at a glance

Adoption and implementation

No change from previous report:

.The Ministry of Health is responsible for checking and approving the health plans' proposals regarding copayment rates.  The ministry aimed for competition among the Health Plans regarding copayment rates, but that has not happened and the rates are quite similar in all Health Plans. The ministry conducts financial audits of revenue as part of its general financial audit of the health plans.  It also is, in principle, responsible for monitoring impact of copays and recommend changes if undesired outcomes are identified.

The health plans have instituted administrative means of collecting copayments in their clinics and independent physician offices. At first, they encountered problems with physicians who had to take on an additional administrative task.They then  adapted their computerized information systems to monitor the ceilings, exemptions and discounts.   Gradually the health plans have installed a system that facilitates automated calculation of quarterly family copayments (such that when a family has reached the payment ceiling, no more copayments are collected). The Ministry of Health demanded that the health plans install this system, in order to safeguard the public's right to discounts. However, it took several years for all of the health plans to implement the automatic ceiling discount system, which was less profitable for them. (Note that prior to the institution of automatic discounts, people had to collect receipts and apply for refunds. Many did not know they could receive refunds, forgot to do, so or didn't bother; the health plans profited from this).

Overall, the copayments have been instituted successfully at least in the operational sense by all of the health plans.  Apparently, the health plans had an interest in implementing this reform (see above), and therefore were efficient in implementing the administrative changes necessary for collecting the copayments.

Monitoring and evaluation

Results from the first phase of the evaluation were reported in the previous survey (4) 2004. The second phase of the evaluation of the effect of copayments on rates of visit to specialists has just been completed (Brammli-Greenberg et al. 2005). During this phase, administrative data from the health plans were analyzed.  We received random samples of 50,000 members per plan from the Clalit, Meuhedet, and Maccabi health plans. The file for each member included all visits to a specialist (including date and specialty) for 1997-2002, as well as background data on age, gender, geographic residence and exemption status.

The health plan data distinguish between those to whom the copayments applied and those who were exempt, making it possible to use the exempt population as a comparison group. In addition, the health plan data were available on a quarterly basis over a five-year period, making it possible to distinguish (at least in part) between secular time trends and one-time changes associated with the initiation of the copayments.

In order to take advantage of these analytic opportunities, and to control for additional potential confounders,  Poisson - random effect  models were estimated, using the STATA program. The Poisson models were used because the statistical distribution of the frequency of visits is consistent with the assumptions of that model, and these are the most efficient models for analysis of panel data.

In Maccabi, as expected, visit rates declined (by four percent) for the non-exempt population, while they increased (by four percent) for the exempt population These findings also held true for visits to specialist with common specialties, which account for the vast majority of specialist visits; however, the opposite was found with regard to visits to specialists with rare specialties.

This would seem to imply that the copayments led to an eight percent decrease in visits, which is consistent with the Rand Health Insurance Experiment Findings, in terms of the direction of the effect (The relatively small size of the effect in Maccabi  could be related to the small increase in the copayment in that health plan who had copayments before 1997, unlike the other health plans who instituted them only in 1998).

 However,  visit rates in Clalit declined for both groups, although, contrary to expectations, the decline was greater for the exempt population than for the non-exempt population (10 percent versus four percent). This would seem to imply that the copayments actually led to a six percent increase in visits. Such a finding would not make sense if one were only to consider the effect of copayments on consumer behavior ("the demand side"). However, copayments can also influence health plan or physician behavior ("the supply side"), by increasing incentives to provide services. 

In Meuhedet, the administrative data indicated a substantial increase in visit rates for both groups (apparently due primarily to improved reporting, and secondarily to greater availability of specialists).  Contrary to expectations, the increase was greater for the non-exempt population than the exempt population (35 percent versus 22 percent). This would seem to imply that the copayments led to a 13 percent increase in visits. As in the case of Clalit, this may be accounted for by the supply factors.

Expected outcome

Assessing the policy based on the new evaluation data:

The data from the second phase of the evaluation are consistent with the findings from previous evaluation data sources ( CBS use of health services survey, CBS households expenditures survey; Myers-JDC- Brookdale institute 1999 and 2001 population surveys ).   Multi-variate analysis of the panel data has revealed that copayments for visits to specialists do not appear to have reduced visit rates in two of the three health plans studied (Maccabi (b=0.01) and Meuchedet (b=0.35).  However, the new data indicate that overall visit rates were reduced in Clalit (b=-0.04).

The findings regarding the effect of copayments on specialist  visit rates for the non-exempt relative to the exempt group in Clalit, Meuhedet and in part in Maccabi (only for visits to rare specialists) are at odds with most research findings regarding copayments in other countries. The unusual findings for Israel may be due to several factors, including:

1.       The copayment levels are relatively low by international standards; particularly in the case of the non-poor, they constituted a very small fraction of household spending.

2.       A large portion of the population was exempt, including various population subgroups for whom the copayments would have been most likely to deter visits.

The new data provide evidence of undesirable effects of this policy (in addition to the previous data regarding patient reports of having forfeited specialist visits due to cost). Apparently, in Clalit and Meuchedet, the exempt population has decreased its visit rates, relative to the non-exempt group.  In Maccabi it has decreased its visits to specialists to whom a referral is needed (though not to specilists to whom there is direct access).

It may be that the health plans have concentrated various service development efforts (such as expanding the number of community-based specialists) in those parts of the country where relatively large proportions of the populations are subject to the copayments. As the government does not compensate the health plans for the copayment exemptions that the health plans are required to give, the health plans' revenues (per member) are higher in those areas. This comes in addition to other factors which encourage health plans to prefer high SES areas, such as higher rates of purchase of supplemental insurance and services outside the benefits package. These factors pre-dated the initiation of the co-payments, but they may have become stronger during the course of the study period.

Similarly, the health plans may have made it easier to schedule appointments with specialists in high SES areas or for high SES persons within any given area. (The 2003 Myers-JDC-Brookdale survey noted above found that recipients of NII allowances were more likely than others to have to wait more than two weeks for appointments with specialists). These factors could explain why the imposition of the copayments appears to have increased the visit rates of the non-exempt population, relative to the exempt population, in both Clalit and Meuhedet.

Another possible explanation for this undesirable effect of copayments may be  that many exempt members were unaware that they were exempt, and believed that they were subject to the copayments. Moreover, being relatively poor, their response to their (perceived) obligation to pay may have been greater than the non-exempt population's response to their (real) obligation to pay.  It should be noted that lack of awareness of copayments may have been more of an issue in Clalit and Meuhedet than in Maccabi, because during the study period Maccabi was the only one of these three health plans to have a computer system which could, in real-time, inform patients that they were exempt from the copayments. This could explain why the findings from Maccabi were more in line with the HIE findings, even though the increase in copayments was smallest in that health plan.

Impact of this policy

Qualität	kaum Einfluss		starker Einfluss
Gerechtigkeit	System weniger gerecht		System gerechter
Kosteneffizienz	sehr gering		sehr hoch
current    previous

Effect on Quality of health care services and equity - assessment changed: The new evaluation data show that the rates of visits to specialists of health plan members who are exempt from copayments have decreased, relative to those of non-exempt patients. The members who are exempt from copayments are primarily from the lowest socio-economic groups: recipients of National Insurance Institute income maintenance benefits, alimony and general disability allowances; health plan members who have four children or more all registered in the same health plan are fully exempt; persons with any of the following diseases are exempt from fees at diagnostic clinics and hospital outpatient departments: ESRD, cancer, AIDS, CF, Gaucher's disease, thalassemia, hemophilia, or TB.  The international literature shows that these groups have greater health needs than do people with high socioeconomic status.  Therefore, the relative decrease in their rates of visit after installation of the copayments may indicate that they are not receivng the care they should receive. Given their needs and their exemption status, we would not expect them to visit specialists less than did those who are not exempt, and possibly even more. Therefore, the new evaluation data arouse yet greater concern than before regarding the effect of copayments (with no compensation to health plans for exemptions)  on the quality of services to vulnerable populations. Under the current remuneration system (health plans recieve prospective payments based on the age of their members, regardless of their socio economic status or health status), the copayments, together with the un-remunerated exemption system , provide yet another incentive to develop services in areas of high socio-economic status, or even to discriminate against the exempt when setting appointments for specialists.

However, the evaluation data are not definitive, as they do not provide information on two important issues: the extent to which visits forfeited as a result of the copayments were medically unnecessary; and whether, and to what extent, the health plans are giving preferential treatment to the non-exempt population.  Further research is needed in order to fully understand how the copayments affect quality of care and equity.

References

Sources of Information

• Brammli-Greenberg, Shuli,  Bruce Rosen, Revital Gross,  R. Feldman, H. Heller, W. Manning, and J. Zwanziger. Co-Payments For Physician Visits: How Large Is the Burden and Who Bears the Brunt? Draft Summary of a Project Report for the Israel National Institute of Health Policy and Health Services Research, 2005.  (English)
• Gross, Revital, Shuli  Brammli-Greenberg,  and Ronit Matzliach.  In press.  Public Opinion about the Level of Health Care Services and Functioning of the Health Care System 1995-2003.  Jerusalem: Myers-JDC-Brookdale Institute. (Hebrew with English abstract)
• Brammli-Greenberg, Shuli.  Co-Payments for Health-Plan Services. Working Paper for the 2003 Dead Sea Conference, National Institute for Health Policy Research, 2003. (Hebrew)
• Ministry of Health.  Handbook of Rights of the Insured by National Health Insurance.  Jerusalem: Ministry of Health, 2002. (Hebrew)
• Roter, T.   Should a co-payment fee for doctor visits be charged in Israel?  Lessons from the experience of Maccabi Health Maintenance Organization.  Economic Quarterly 43(1): 146-68, 1996. (Hebrew)
• Rosen, Bruce, R. Schwartz, M. Sicron, Israel Sykes, and Ayelet Berg-Warman.. Data Use in Major Government Decisions Related to National Health Insurance. RR-402-03  JDC-Brookdale Institute Jerusalem, 2003.
• Rosen, Bruce. Israel, In Health Care Systems in Transition, edited by S. Thomson  and E. Mossialos. Copenhagen: European Observatory on Health Care Systems 5(1), 2003.
• State of Israel.   The 1998 Budget Reconciliation Law.  Jerusalem: Israeli Governmental Printing Office, 1998.  (Hebrew)

State of Israel.    Report of the Commission to Examine Public Medicine and the Physician's Status, Tel Aviv, 2002. (Hebrew)

Reform formerly reported in

Copayment evaluation: Impact on access and equity Process Stages: Evaluation

Author/s and/or contributors to this survey

Brammli-Greenberg, Shuli, Bruce Rosen and Revital Gross (Myers-JDC-Brookdale Institute)

Empfohlene Zitierweise für diesen Online-Artikel:

Brammli-Greenberg, Shuli, Bruce Rosen and Revital Gross (Myers-JDC-Brookdale Institute). "Copayments for physician visits". Health Policy Monitor, May 2005. Available at http://www.hpm.org/survey/is/a5/1