Despite Backlash against Managed Care, Most U.S. Physicians Contract with MCOs, Study Finds

About 90% of U.S. physicians contracted with at least one managed care organization between 1997 and 2001, despite the "backlash against managed care," according to a national study released yesterday by the Center for Studying Health System Change. The study also found that among physicians with managed care contracts, total average practice revenue from managed care increased from 43% in 1997 to 46% in 2001. The average number of managed care contracts per physician also rose over the same time period, from 12.4 in 1997 to 13.1 in 2001 -- an increase that the study attributed in part to MCO "efforts to broaden networks and give consumers more choice of providers." In addition to increased physician participation in managed care, the study found a "significant decrease" in capitated payments; the proportion of physician practices with managed care contracts that received some revenue from capitation decreased from 57.4% in 1997 to 48.6% in 2001. HSC President Paul Ginsburg called the results of the study "a bit surprising given the intense backlash against managed care and stories about physicians dropping out of managed care plans." He added, "Managed care remains an integral part of the practice of medicine, but the nature of the relationship between physicians and managed care plans is shifting to a kinder, gentler approach" (HSC release, 11/7). The study is available online.