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The Impact of Tiered Physician Networks on Patient Choices

Keywords: Tiered networks;consumer choice;providers;managed care;cost-sharing.

Objective: To assess whether patient choice of physician or health plan was affected by physician tier-rankings.

Data Sources: Administrative claims and enrollment data on 171,581 nonelderly beneficiaries enrolled in Massachusetts Group Insurance Commission health plans that include a tiered physician network and who had an office visit with a tiered physician.

Study Design: We estimate the impact of tier-rankings on physician market share within a plan of new patients and on the percent of a physician's patients who switch to other physicians with fixed effects regression models. The effect of tiering on consumer plan choice is estimated using logistic regression and a pre–post study design.

Principal Findings: Physicians in the bottom (least-preferred) tier, particularly certain specialist physicians, had lower market share of new patient visits than physicians with higher tier-rankings. Patients whose physician was in the bottom tier were more likely to switch health plans. There was no effect of tier-ranking on patients switching away from physicians whom they have seen previously.

Conclusions: The effect of tiering appears to be among patients who choose new physicians and at the lower end of the distribution of tiered physicians, rather than moving patients to the “best” performers. These findings suggest strong loyalty of patients to physicians more likely to be considered their personal doctor.


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