Breakeven Rate Estimated for Mid-Size Pediatric Practice

Share this content:
Breakeven Rate Estimated for Mid-Size Pediatric Practice
Breakeven Rate Estimated for Mid-Size Pediatric Practice

FRIDAY, July 29, 2016 (HealthDay News) -- The capitated payment breakeven rate has been calculated for a mid-size pediatric practice, with a breakeven per-member per-month (PMPM) rate of $24.10, according to research published online July 29 in Pediatrics.

Steven A. Farmer, M.D., Ph.D., from the Duke-Margolis Center for Health Policy in Washington, D.C., and colleagues supplemented a literature review and data from more than 200 practices with interviews of practice administrators, physicians, and payers to construct an income statement for a hypothetical pediatric fee-for-service practice. To calculate the breakeven capitated rate, the practice was transitioned to full capitation, holding all practice parameters constant. The impact of panel size, overhead, physician salary, and staffing ratios was assessed on the breakeven PMPM rate.

The researchers found that the calculated breakeven PMPM was $24.10; 80 percent of practices broke even with a PMPM of $35.00 when an economic simulation allowed core practice parameters to vary across a broad range. When the staffing ratio increased by 25 and 38 percent, the breakeven PMPM increased by 12 percent ($3.00) and 23 percent ($5.50), respectively. Even with the primary care medical home staffing ratios, the practice was viable when rates from a real-world payer were applied.

"Practices are more likely to succeed in capitated models if pediatricians understand how these models alter practice finances," the authors write.

Full Text (subscription or payment may be required)

Share this content:

is free, fast, and customized just for you!

Already a member?

Sign In Now »


Sign up for myCME e-newsletters


Drug Lookup

Browse drugs by: BrandGenericDisease

More in Home

NTproBNP Levels Are Significantly Lower in Blacks

NTproBNP Levels Are Significantly Lower in Blacks

Higher NTproBNP levels linked to increased risk of death; this association did not differ by race

Data May Weigh on Pros/Cons of Expanded Care Optometry

Data May Weigh on Pros/Cons of Expanded Care ...

Majority of residents in Kentucky, Oklahoma, New Mexico live within 30 minutes of ophthalmologist

Gaps Seen Between Hearing Loss, Receipt of Medical Evaluation, Tx

Gaps Seen Between Hearing Loss, Receipt of Medical ...

About 20.6 percent of those with hearing less than excellent/good had visited doctor for hearing issues

is free, fast, and customized just for you!

Already a member?

Sign In Now »