The highest-paid physicians generally receive twice as much in reimbursements from private insurers compared to what the lowest-paid physicians got for the same service, according to a Health Affairs study.
Researchers examined claims for physician services in 2007 from the Truven Health MarketScan Commercial Claims and Encounters Database. They focused on claims for patients enrolled in preferred provider organizations and noncapitated point-of-service plans. The researchers analyzed the "allowed amount" — the contractually agreed amount the plans allowed physicians to be paid for the service.
For various services, the allowed amount physicians could receive varied significantly. For example, the amounts ranged from less than $50 to more than $85 for an intermediate office visit with an established patient — the most commonly billed service in the data set.
Differences in illness severity, complexity of patients' conditions, the balance of market power between physicians and health plans and quality of care are all potential drivers of these price variations, according to the study. Although the findings indicate policies reducing variation could prove beneficial, more information is needed about what causes the price differences to determine what changes policymakers need to enact, according to the study.
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