The arbitration award for Years 2–4 of the 2024–28 Physicians Services Agreement (PSA) has confirmed important updates to the Family Health Organization (FHO) model. Alongside the upcoming FHO+ model, which introduces new funding streams and enhancements to the existing FHO structure, the arbitration decision’s proposed factors will establish new accountability measures, including continuity of care requirements, to support rostering and longitudinal patient care within the FHO+ framework.
In this blog, we’ll explain the arbitration results and their implications for physicians, recap what physicians can expect from the FHO+ model, and discuss how DoctorCare can assist with the new continuity of care accountability measure.
Recap of Key Improvements to the FHO Model
During mediation, the Ministry of Health and the OMA made substantial progress in revising the FHO framework. The arbitration award confirms several key changes:
- Hourly Payments Introduced: FHO physicians will now receive an hourly rate to recognize both direct and indirect patient care and clinical administration, on top of their existing capitation payments.
- Enhanced Shadow Billing and Fee Increases: Significant increases were awarded for shadow billing, after-hours premiums, and group leadership funding. These changes better align FHO compensation with the real-world demands and workload of family physicians.
- Attachment Bonuses: New incentives will encourage physicians to roster unattached patients, supporting Ontario’s priority of improving patient attachment and access.
- Elimination of Access Bonus and Negation: The access bonus system and the long-criticized dollar-for-dollar negation tied to outside use, has been removed. This provides physicians with more predictable compensation that better reflects their contribution to patient care.
- Co-location Flexibility: Guidelines for FHO co-location have been liberalized by decreasing the number of doctors per co-location from 3 to 2, making it easier for physicians to form and sustain FHO groups.
These enhancements aim to make the FHO model more attractive for both new graduates and experienced family physicians, helping to strengthen physician recruitment and retention.
Proposed Arbitration Results
Continuity of Care: A New Accountability Measure
You may be wondering what “continuity of care” is, and how it affects you as a FHO physician.
The proposed arbitration decision states that continuity of care includes in-basket services you provide to your own rostered patients, in addition to in-basket services provided by other doctors in your FHO group, locums registered with your group, any designated GP focus practice physicians, and even family doctors working in hospitals or emergency departments.
To replace the previous system of negation, the OMA has established a minimum continuity of care requirement of 75% for rostered patients. This threshold is calculated by dividing all those in-basket factors mentioned by all in-basket services delivered by any family practice specialty physician for your rostered patients.
It should also be noted that, unlike in the case of negation, where there was a financial consequence of a dollar-for-dollar deduction, this will not be the case with the FHO+ model. Instead, if a FHO physician’s continuity metric falls below 75%, a 15% reduction to the capitation rate will be applied quarterly.
The good news is that the reductions will not be applied right away. Affected physicians will receive a notice that their continuity of care has fallen below 75% in a given quarter. They’ll also have a fair chance to make improvements in the following quarter before any financial penalty is applied.
This measure is intended to support patient-centred longitudinal care while moving away from the punitive effects of the former negation framework
Managed FHO Entry
FHO managed entry is a system that regulates the number of new FHOs and physicians who can join them each month to ensure controlled growth and equitable distribution of physicians, particularly in areas of high need. The current monthly allowance of 60 physicians, who are permitted to join FHOs across Ontario, will continue into years 2, 3, and 4 of the PSA. Any unused spots will roll over to the following year, and the FHG to FHO transition will also be exempt from the managed entry.
What Do These PSA Arbitration Updates Mean for Physicians
The introduction of the Continuity of Care accountability metric marks a shift in the evaluation of patient access. For FHO physicians, this means that in-basket services, both those you provide directly and those offered by other physicians in your group or registered locums, will now contribute to your continuity metric and can be compared against all services provided to your rostered patients from any family physician.
Rather than focusing solely on patient access, the new model emphasizes sustained, ongoing relationships between patients and their primary care providers. The 75% continuity threshold encourages physicians to maintain consistent engagement with their own rostered patients while still benefiting from team-based care within the FHO model.
The OMA will continue to communicate how to measure these parameters effectively, and DoctorCare’s reports will likely appear differently as a result.
How DoctorCare Can Support You
Although the FHO+ model will automatically transition all existing FHO physicians starting April 2026, you might still need assistance in navigating the changes that come with FHO+.
Through our comprehensive continuity tracking and analytics tools, we can help you:
- Monitor your continuity rate on a month-to-month basis to ensure you stay above the 75% threshold.
- Identify patterns and gaps in patient encounters, including services delivered by external physicians that may affect your continuity score.
- Receive actionable insights and recommendations to optimize your workflow, scheduling, and delegation practices to maintain continuity.
- Support performance improvement plans if your metric falls below the required benchmark, giving you the data and strategies needed to recover before any financial penalty applies.
Conclusion
The arbitration decision signals a new chapter in how family physicians are supported and measured in delivering comprehensive care in Ontario. By focusing on continuity of care, the goal is to strengthen patient relationships and reinforce the value of team-based, longitudinal care.
At DoctorCare, we’re here to make navigating this transition as smooth as possible. Our data-driven tools, personalized advisory support, and in-depth understanding of FHO operations give you the clarity and confidence you need to stay ahead of these changes.
Disclaimer: This blog post is based on the proposed FHO+ model as presented during PSA negotiations. All details are subject to change at any time. Physicians should consult with their professional associations and billing experts for the most current information and personalized advice.
Additional Resources
Below are helpful resources to support primary care physicians starting a FHO practice:
Web Page: FHO+ Payment Model Resources
Webinar: Preparing for FHO+: What Ontario Family Physicians Should Expect
Blog: Understanding the Proposed FHO+ Model: What Ontario Family Physicians Need to Know
Blog: A Guide to the Income Stabilization Program for FHO Physicians
