Relationships with Physicians
The second dimension is the legal relationship between the physicians and the MCO, as characterized in the following listing.
Employees: Physicians are simple employees of the MCO, with no intervening physician group. Except for governmental MCOs, corporate practice of medicine bans make these MCOs less common than independent contractor MCOs.
Physician Group: Developed in response to corporate practice of medicine bans, physicians are either employees, partners, or shareholders in a physician- controlled partnership or professional corporation, which in turn contracts with one or more MCOs. This is the most common organizational structure for the older HMOs, such as Kaiser-Permanente Health Plan in California.
Independent Contractor: In this model, physicians may be either sole proprietors or members of a partnership or professional corporation, but they individually contract with one or more MCOs. The contracts are similar to those utilized in the physician group model. Interference with individual physician decision making is much more personal and intrusive when there is no physician group to function as a buffer between the physician and the MCO.