Variations in primary care physician referral rates

Objective. To examine primary care physician referral rate variations, incl uding their extent and their stability over time and across diagnostic cate gories. Data Sources. 1995/1996 claims data for adult patients from a large Indepen dent Practitioner Association (IPA) model managed care organization (MCO) i n the Rochester, NY metropolitan area. The IPA includes over 95 percent of area primary care physicians (PCPs), and the MCO includes over 50 percent a rea residents. Study Design. Referral rates (patients referred to and seen by specialists one or more times/patients seen by PCP/year) were developed for the PCPs (4 57 general practitioners, family physicians, and internists) in the MCO, in cluding observed referral rates, expected referral rates based on case-mix adjustment across the whole sample, physician-specific case mix-adjusted re ferral rates (empirical Bayes estimates), and diagnostic category-specific case mix-adjusted referral rates. Principal Findings. Wide variations in observed referral rates (0.01-0.69 p atients referred/patients seen/year) were attenuated relatively little by c ase-mix adjustment and persisted in case mix-adjusted empirical Bayes estim ates (0.02-0.65). The year-to-year case mix-adjusted referral rate correlat ion was .90. Correlations of case mix adjusted-referral rates across diagno stic categories were moderate (r = .46-.67). Conclusions. PCP referral rates exhibit wide variations that are independen t of case mix, remain stable over time, and are generalizable across diagno stic categories. Understanding this physician practice variation and its re lationship to costs and outcomes is critical to evaluating the effect of cu rrent efforts to reduce PCP referral rates.