California Physicians are Dropping Out of Managed Care, According to UCSF Researchers

December 02, 2002

Only 58 percent of patient care physicians in California are accepting new patients with HMO coverage, and the “California Model” of loose networks of private practice physicians organized into large managed care practice organizations is unraveling, according to UCSF researchers.

Results of the 2001/2002 California Physicians Survey, commissioned by the California HealthCare Foundation (CHCF) and conducted by researchers at the UCSF Center for the Health Professions, appear at www.futurehealth.ucsf.edu. The survey included a representative sample of 1033 physicians throughout the major urban regions of California. 

“California led the nation’s charge into managed care. Our study of the state’s physicians tells us that California has now sounded the retreat,” said Kevin Grumbach, MD, UCSF professor of family and community medicine at San Francisco Hospital General Medical Center (SFGHMC) and director of the Center for California Health Workforce Studies. “Private physicians are starting to abandon HMOs, IPAs and managed care networks. A major exception is Kaiser Permanente, which has maintained much greater allegiance among its physician staff. “

The survey indicates that more than 33 percent of specialist physicians in the state have no patients in their practice insured by HMO plans, up from 23 percent of specialists without HMO patients in 1998.  The rate of physician participation in private HMO plans is approaching the historically low rate of physician participation in Medi-Cal, the state’s insurance plan for low income Californians, according to survey results.

“The problem of lack of availability of physicians in many regions of California is largely due to physicians not accepting patients with certain types of insurance, rather than due to an absolute deficiency of the number of physicians practicing in California,” said Grumbach.
In addition, fewer physicians are participating in Independent Practice Associations (IPAs), the most common form of physician managed care network. Five years ago, 73 percent of all office-based primary care physicians in California were members of an IPA. In 2001/2002, 62 percent belonged to an IPA. Just over half (55 percent) of specialist physicians in California participated in an IPA in 2001/2002, down from two thirds (65 percent) in 1998.

Almost half (46 percent) of specialists and one third (34 percent) of primary care physicians in the state are in solo practice.
The UCSF researchers noted that Kaiser Permanente appears to have the most “staying power” for California physicians.  In fact, physicians working in Kaiser Permanente consistently express more positive opinions about their medical practice organization than do physicians working in IPAs and other types of managed care networks, according to the UCSF researchers.  About 20 percent of the state’s primary care physicians and 15 percent of specialists work in the Kaiser Permanente system.

The California Physicians Survey was conducted by the California Workforce Initiative (CWI) at the UCSF Center for the Health Professions. Additional findings from the 2001/2002 California Physicians Survey titled California Physicians 2002:  Practice and Perceptions include the following:

* Compared to one year ago, physicians are working more hours per week on average;
* Overall satisfaction with being a physician has been stable for the past several years. About 80 percent of California physicians are satisfied with their work, similar to satisfaction rates in previous surveys;
* Physicians are dissatisfied with the practice environment in their community.  Most perceive major problems in recruitment and retention of physicians, payment rates, and overall practice climate in their community;
* Retirement plans among physicians have not changed over the past several years. About 80 percent of physicians plan to be seeing patients in three years, similar to responses in previous surveys;
* Like many policy analysts, physicians are uncertain about whether there are too many, too few, or just the right number of physicians in their community;
* Most physicians do not feel threatened by regulations that increase the scope of practice for non-physician clinicians, such as nurse practitioners, optometrists, and midwives;
* Many physicians recognize that there are social disparities in access to medical care; and
* Additional researchers, all affiliated with the UCSF Center for the Health Professions, include: Catherine Dower, JD; Sunita Mutha, MD; Jean Yoon, MHS; William Huen; Dennis Keane, MPH; Diane R. Rittenhouse, MD, MPH; and Andrew B. Bindman, MD.

The survey was funded by the California Healthcare Foundation, which, in partnership with The California Endowment, funds the California Workforce Initiative.

The California HealthCare Foundation, based in Oakland, is an independent philanthropy committed to improving California’s health care delivery and financing systems. Formed in 1996, its goal is to ensure that all Californians have access to affordable, quality health care.

The California Endowment, a private, statewide health foundation, was established to expand access to affordable, quality health care for underserved individuals and communities. The Endowment provides grants to organizations and institutions that directly benefit the health and well-being of the people of California.