A new type of independent practice association has been organized to encourage primary-care physicians in private practice to become coordinators and financial managers for all medical care. Each patient chooses one internist, family or general physician or pediatrician and must be referred by that physician for all specialized care. The primary-care physician authorizes payment from his own account for all care provided to his patients. He shares any deficit or surplus remaining at the end of the year. After four years of operation, United Healthcare has 610 primary-care physicians treating 23,000 patients. Total hospital use during 1978 was 293 beddays per 1000 patients, as compared with 479 for Blue Cross. The hospital-admission rate per 1000 was 88, as compared with 101 for Blue Cross. Average lengths of stay were 3.3 and 4.7 days, respectively. This plan represents another means to control costs in the private medical marketplace. (N Engl J Med 300:1359–1362, 1979) AS costs of medical care become a major concern, there is increasing interest in finding other ways to preserve the good aspects of fee-for-service practice while controlling costs. Although it is widely acknowledged that physicians determine most health-care expenditures, the present fee-for-service system does not encourage or reward cost-effective behavior of patients or physicians. In most instances, cost-increasing behavior is rewarded by reimbursement to physicians on the basis of their charges, cost reimbursement to hospitals and insulation of patients from direct costs because of widespread third-party reimbursement. Even when a physician is concerned about costs, the fragmentation of the health-care. © 1979, Massachusetts Medical Society. All rights reserved.
