A Causal View of the Role and Potential Limitations of Capitation in Promoting Whole Health System Performance.
Abstract
For several decades, health systems in developed countries have faced rapidly rising
healthcare costs without concomitant improvements in health outcomes. Fee for service
(FFS) reimbursement mechanisms (RMs), where health systems are paid based on volume,
contribute to this trend. In Singapore, the public health service is trying to curb
rising healthcare costs by transitioning from a volume-based RM to a capitated payment
for a population within a geographical catchment area. To provide insight into the
implications of this transition, we developed a causal loop diagram (CLD) to represent
a causal hypothesis of the complex relationship between RM and health system performance.
The CLD was developed with input from government policymakers, healthcare institution
administrators, and healthcare providers. This work highlights that the causal relationships
between government, provider organizations, and physicians involve numerous feedback
loops that drive the mix of health services. The CLD clarifies that a FFS RM incentivizes
high margin services irrespective of their health benefits. While capitation has the
potential to mitigate this reinforcing phenomenon, it is not sufficient to promote
service value. This suggests the need to establish robust mechanisms to govern common
pool resources while minimizing adverse secondary effects.
Type
Journal articleSubject
Government ProgramsSalaries and Fringe Benefits
Health Services
Health Care Costs
Fee-for-Service Plans
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https://hdl.handle.net/10161/26996Published Version (Please cite this version)
10.3390/ijerph20054581Publication Info
Matchar, David Bruce; Lai, Wei Xuan; Kumar, Ashish; Ansah, John Pastor; & Ng, Yeuk
Fan (2023). A Causal View of the Role and Potential Limitations of Capitation in Promoting Whole
Health System Performance. International journal of environmental research and public health, 20(5). pp. 4581. 10.3390/ijerph20054581. Retrieved from https://hdl.handle.net/10161/26996.This is constructed from limited available data and may be imprecise. To cite this
article, please review & use the official citation provided by the journal.
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Show full item recordScholars@Duke
David Bruce Matchar
Professor of Medicine
My research relates to clinical practice improvement - from the development of clinical
policies to their implementation in real world clinical settings. Most recently my
major content focus has been cerebrovascular disease. Other major clinical areas in
which I work include the range of disabling neurological conditions, cardiovascular
disease, and cancer prevention. Notable features of my work are: (1) reliance on
analytic strategies such as meta-analysis, simulation, decision analy

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