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The California Model

The California Model Of Physician Contracting

PROLOGUE: During the ascent of the managed care theory, proponents often argued that the central mechanism of true managed care was capitated payment to providers, which fused the functions of financing and delivering care and finally aligned the incentives that governed the behavior of hospitals, doctors, and insurers. All other tools for managing care and cost flowed from that alignment.

In the California market, where the practice of capitated payment to physician groups first flourished and still dominates the managed care landscape, this paradigmatic mechanism is found to be under siege. "The crisis has swept through every form of physician . . . [Full Text of this Article]

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