Costs of healthcare across primary care models in Ontario

Background — The purpose of this study is to analyze the relationship between newly introduced primary care models in Ontario, Canada, and patients’ primary care and total healthcare costs. A specific focus is on the payment mechanisms for primary care physicians, i.e. fee-for-service (FFS), enhanced-FFS, and blended capitation, and whether providers practiced as part of a multidisciplinary team.

Methods — Utilization data for a one year period was measured using administrative databases for a 10% sample selected at random from the Ontario adult population. Primary care and total healthcare costs were calculated at the individual level and included costs from physician services, hospital visits and admissions, long term care, drugs, home care, lab tests, and visits to non-medical healthcare providers. Generalized linear model regressions were conducted to assess the differences in costs between primary care models.

Results — Patients not enrolled with a primary care physicians were younger, more likely to be males and of lower socio-economic status. Patients in blended capitation models were healthier and wealthier than FFS and enhanced-FFS patients. Primary care and total healthcare costs were significantly different across Ontario primary care models. Using the traditional FFS as the reference, we found that patients in the enhanced-FFS models had the lowest total healthcare costs, and also the lowest primary care costs. Patients in the blended capitation models had higher primary care costs but lower total healthcare costs. Patients that were in multidisciplinary teams (FHT), where physicians are also paid on a blended capitation basis, had higher total healthcare costs than non-FHT patients but still lower than the FFS reference group. Primary care and total healthcare costs increased with patients’ age, morbidity, and lower income quintile across all primary care payment types.

Conclusions — The new primary care models were associated with lower total healthcare costs for patients compared to the traditional FFS model, despite higher primary care costs in some models.