Primary care gatekeepers in HMOs

The most pressing issue in health care delivery today is inflationary cost increases. The gatekeeping role of primary care physicians, particularly family physicians, may lower health care costs through a more judicious use of specialty referrals, expensive tests, and hospitalization. The study of such an impact is most readily carried out in the practice setting of health maintenance organizations (HMOs), where there is a defined patient population. Incomplete data and lack of sensitive indicators of the gatekeeping effect are limitations of this preliminary study. The results show, however, that the internal organization of an HMO does not influence hospital and ambulatory care utilization rates, with the exception that HMOs staffed by a group of salaried physicians (staff HMOs) reported higher ambulatory care utilization. No significant differences were demonstrated in hospital or ambulatory care utilization rates among the HMOs using more primary care physicians or family physicians than others. The results indicate that ambulatory care utilization rates are proportional to the number of physicians per 1,000 members. The results also suggest that there may be an inverse relationship between hospital utilization rates and the number of primary care physicians, especially if they are family physicians. Further studies need more specific indicators to evaluate the effect of the gatekeeping role in health care delivery.     

North Med HMO

NorthMed HMO is viewed by its owners as an important vehicle for integrating rural providers in northern Michigan. Through the HMO, rural providers hope to be able to contract with government programs, while retaining private-sector patients through employer contracts. For most rural providers, NorthMed HMO does not yet represent a major source of revenues. However, the HMO is about to embark on an expansion that, if successful, will increase its importance to providers and its visibility within the service area. This planned expansion is likely to place severe demands on the financial and managerial resources of the organization. Physicians. NorthMed HMO offers a model of a rural-based HMO in which physicians play a dominant role. Rural physicians in northern Michigan own Northern Physician Organization, a physician organization which, in turn, is the major stockholder in NorthMed HMO. The geographic expansion of the HMO is tied, in large part, to the geographic expansion of the membership of Northern Physician Organization. NorthMed HMO enters new communities when a significant number of physicians in those communities joins Northern Physician Organization. When physicians purchase ownership shares in the physician organization, they indirectly become part owners of the HMO. Participation in NorthMed HMOs network has offered limited benefits to rural physicians at a minimal cost. By being a participating provider in NorthMed HMO, physicians can remain available to their patients who choose the HMO as a health insurance option. NorthMed HMO has not been aggressive in attempts to influence physician practices, and physicians bear no financial risk as a result of their participation. Participating physicians are paid under a fee-for-service arrangement with no risk sharing related to hospital use. Indirectly, through Northern Physician Organization's ownership role in the HMO, physicians have the potential to gain financially from NorthMed HMOs growth if the HMO were to be sold, but this diffuse incentive is unlikely to have an impact on physicians' day-to-day behavior. The relationship between NorthMed HMO and its physicians is likely to change soon. The number of HMO patients seen by physicians will increase if the HMO succeeds in securing Medicare and Medicaid contracts, and if its new point-of-service option attracts additional private-sector enrollees. NorthMed HMO plans to contract with Northern Physician Organization on a capitated basis to serve the HMOs enrollees, an arrangement that would place financial responsibility for managing care delivery more directly on participating physicians. This is likely to result in more aggressive utilization review and quality assurance measures. In effect, rural physicians will be faced with a difficult trade-off that they have, to this point, largely avoided: They will be asked to accept financial risk and oversight of their practices in return for the assurance that their HMO can successfully compete for local patients (and their insurance dollars) against health plans that are owned and managed by entities located outside of their rural area.     

Foreign medical graduates in the 1980s: trends in specialization.

Secondary analysis of data collected by the American Medical Association and the Graduate Medical Education National Advisory Committee (GMENAC) suggests that measures to diminish the flow of alien Foreign Medical Graduates (FMGs) into the United States have been less effective than planned. Declining trends in the proportion of FMG house officers in the mid- to late-1970s have recently stabilized around 19 per cent. There has also been a dramatic increase in the number of US citizen Foreign Medical Graduates ( USFMGs ) in house officer positions. A pattern of alien FMG and USFMG house officer specialization correlates with specialties designated by the GMENAC as shortage areas by 1990 (r = -.49, p less than .05). Despite the GMENAC prediction of a surplus of physicians by 1990, differential selection of alien FMGs and USFMGs into shortage specialties may assure their substantial future presence in the US health care system.     

The impact of membership in a health maintenance organization on hospital admission rates for acute chest pain.

OBJECTIVE. We evaluate the impact of membership in a staff-model health maintenance organization (HMO) on hospital admission rates for patients presenting to an emergency department with acute chest pain. DATA SOURCES AND STUDY SETTING. Primary prospective data were gathered from all 3,006 patients presenting with a chief complaint of chest pain to the emergency department (ED) of a university teaching hospital from October 1987 to November 1989. STUDY DESIGN. Prospective cohort analysis used clinical data to stratify patients into groups at high (> or = 25%), medium (8-24%), and low risk (< or = 7%) of acute myocardial infarction (AMI). Insurance status was determined as either HMO, Medicare, commercial, Medicaid, or self-pay. Triage decisions were recorded, and patient outcomes of AMI and other final diagnoses were determined for all patients. DATA COLLECTION METHODS. Clinical data were recorded by the physicians in the ED as part of a detailed protocol. Insurance data were recorded separately by the ED staff as part of the hospital administrative database. Patient outcomes were recorded daily by research nurses for hospitalized patients; for patients who were discharged from the ED, telephone or physician follow-up was accomplished within seven days after discharge. PRINCIPAL FINDINGS. HMO patients were more likely to be admitted to the hospital than patients in other insurance groups in both the medium- and low-risk patient categories. Within the low-risk category, after controlling for clinical differences in a multiple logistic model, HMO membership retained an independent positive association with hospital admission compared to all other insurance groups except Medicaid. CONCLUSIONS. For patients with acute chest pain who were at medium and low risk of acute myocardial infarction, HMO membership was associated with higher rates of hospital admission. These findings suggest that organizational factors beyond financial incentives may exercise an important influence on hospitalization rates for HMO patients.     

GMENAC report on U.S. physician manpower policies: recommendations and reactions.

After four years of study in the United States, the Graduate Medical Education National Advisory Committee (GMENAC) concluded that an excess of approximately 70,000 physicians will exist in 1990. Faced with a future surplus, GMENAC recommends that U.S. medical schools decrease enrollment levels by 10 percent relative to the 1978-79 level and severely restrict entrance of foreign medical graduates. Flaws identified in the GMENAC approach relate to the use of the delphi technique, the future role of nonphysician providers, and a lack of reliable data. The GMENAC report may provide impetus for an abrupt shift from expansionism to reductionism in U.S. physician manpower policy. Long range physician manpower planning has erred in the past, necessitating periodic reevaluation of national policy. A continuing balance between supply and demand, although ideal, can probably never be attained. Thus small adjustments in total supply and specialty mix will always be necessary. The GMENAC report, which is the most comprehensive study of U.S. physician manpower to date, requires serious consideration in this context.     

Physicians'' use of laboratory, radiology, and drugs in a prepaid group practice HMO.

Use by physicians of medical care resources to treat similar patients and morbidities has implications for the efficiency and effectiveness of medical care. This study examined the variation in primary care physicians' use of outpatient laboratory, radiology, drugs, and hospital admissions; the relationships among the uses of these resources by physicians; and uses of these resources by physicians over time. The setting was a large HMO and the physicians were internists (n = 30), pediatricians (n = 20), and obstetrician/gynecologists (n = 17). Resource use was a dollar rate for laboratory, radiology, and drug, and an admission rate per contact for the hospital. The physicians' use rates were derived from the computerized utilization record of a sample of HMO members for 1976-1978. Substantial variation occurred in the rates of use of each resource by physicians in each specialty. The relationships among the resource rates were similar for internists and pediatricians, and were somewhat stronger than expected clinically. There were also substantial consistencies over time in the levels of use of laboratory and drugs by internists and pediatricians. Findings suggest a potential for more judicious use of ambulatory care resources by primary care physicians in this setting.     

HMO penetration and the geographic mobility of practicing physicians

In this study, we assessed the influence of changes in health maintenance organization (HMO) penetration on the probability that established patient care physicians relocated their practices or left patient care altogether. For physicians who relocated their practices, we also assessed the impact of HMO penetration on their destination choices. We found that larger increases in HMO penetration decreased the probability that medical/surgical specialists in early career stayed in patient care in the same market, but had no impact on generalists, hospital-based specialists, or mid career medical/surgical specialists. We also found that physicians who relocated their practices were much more likely to choose destination markets with the same level of HMO penetration or lower HMO penetration compared with their origin markets than they were to choose destination markets with higher HMO penetration. The largely negligible impact of changes in HMO penetration on established physicians' decisions to relocate their practices or leave patient care is consistent with high relocation and switching costs. Relocating physicians' attraction to destination markets with the same level of HMO penetration as their origin markets suggests that, while physicians' styles of medical practice may adapt to changes in market conditions, learning new practice styles is costly.     

Improving influenza vaccination performance in an HMO setting: the use of computer-generated reminders and peer comparison feedback.

We evaluated a program for improving influenza immunization performance in a health maintenance organization (HMO). The HMO implemented several interventions successively from 1984-87: a postcard reminder to members at high risk for complications of influenza, a computer-generated reminder to the physician at the time of any primary care visit by high-risk patients, performance feedback to chiefs of service, and, finally, retrospective feedback to each physician comparing his/her performance with that of the other physicians. We examined immunization rates for a group of members older than age 65, a high-risk group under age 65, and a group of diabetic members who had not been subject to the reminders (vs a group who had been covered by the program). Vaccination rates were increased in those diabetic members who received reminders. Nevertheless, among members younger and older than age 65 whose experience was observed over three flu seasons, a significant increase in vaccination rates was not achieved until physician feedback was added to the program. We conclude that each element of the reminder and feedback program has contributed to the overall increase in vaccination rates at the HMO and that effective ongoing influenza immunization programs can be implemented in practice settings with appropriate systems support.     

Organizational impact on medicine: The HMO concept

This paper examines the role of physicians within the HMO (health maintenance organization) context. The development of HMOs in the United States is traced from their origins to the present time. The literature reveals the emergence of four factors within the practice of medicine; a shift of control away from physicians, the reduction of their prestige, the redefinition of medical quality and increased patient control over the treatment regimen. The paper concludes that (a) while physicians remain relatively powerful, some of their control and prestige are eroded by the organizational setting, (b) HMO physicians must pay greater attention to colleagues, personnel and patients than their fee-for-service counterparts and (c) definitions of medical quality are becoming increasingly rationalized.     

Research on potential radiation risks in areas with nuclear power plants in Japan: leukaemia and malignant lymphoma mortality between 1972 and 1997 in 100 selected municipalities.

The results of a geographical correlation study using Poisson regression analysis are reported for leukaemia and malignant lymphoma mortality between 1972 and 1997 in 100 selected Japanese municipalities with or without a nuclear power plant (NPP). The data did not support social concerns of an increased risk of malignant lymphoma in the vicinity of Japanese NPPs. However, some estimates of overall excess relative risk (ERR; relative risk minus one) were statistically significantly positive for leukaemia mortality in 20 NPP municipalities compared with mortality in the remaining 80 control areas, taking into account a minimum two-year latency following the start of commercial operation. One estimate was 0.228 (95% CI: 0.074-0.404) from a simple area adjustment using the mortality in all Japan as the external baseline rate. This superficial increase is not due to leukaemia among young people, aged less than 25 years at death. The ERR estimate for ages at death of 50-74 years was confounded to be positive for leukaemia and distorted to be negative for malignant lymphoma. For leukaemia, a positive ERR estimate was seen, especially for females and during specific periods. Confounding of the ERR estimate for two causes was also seen in some NPP areas including a high adult T-cell leukaemia (ATL) area. Temporal area variations associated with ATL misclassification and a temporal increasing trend of leukaemia mortality in the elderly caused the confounding effects. Our findings do not support the hypothesis of a leukaemogenic impact of NPPs in Japan.     

How do HMOs achieve savings? The effectiveness of one organization's strategies.

OBJECTIVE: To examine how a group practice used organizational strategies rather than provider-level incentives to achieve savings for health maintenance organization (HMO) compared to fee-for-service (FFS) patients. DATA SOURCES/STUDY SETTING: A large group practice with a group model HMO also treating FFS patients. Data sources were all patient encounter records, demographic files, and clinic records covering 3.5 years (1986-1989). The clinic's procedures to record services and charges were identical for FFS and HMO patients. All FFS and HMO patients under age 65 who received any outpatient services during approximately 100,000 episodes of the seven study illnesses were eligible. STUDY DESIGN: Using an explanatory case design, we first compared HMO and FFS rates of resource utilization, in standardized dollars, which measured the impact of organizational strategies to influence patient and provider behavior. We then examined the effect of HMO insurance and organizational measures to explain total outpatient use. Key variables were standardized charges for all outpatient services and the HMO's strategies. PRINCIPAL FINDINGS: Patient and provider behavior responded to organizational strategies designed to achieve savings for HMO patients; for instance, HMO patients used midlevel providers and generalists more often and ER and specialists less often. Overall HMO savings, adjusted for case mix, were explained by the specialty of the physicians the patients first visited and appeared to affect patients with average health more than others. CONCLUSION: Organizational strategies, without resort to differential financial incentives to each provider, resulted in lower rates of outpatient services for HMO patients. Savings from outpatient use, especially for common diseases that rarely require hospitalization, can be substantial.     

Are HMOs bad for health maintenance?

This study examines the impact of Health Maintenance Organization (HMO) coverage on the provision of preventive medicine. We investigate whether any association reflects selection effects on the part of patients and/or physicians or a causal impact of managed care itself. Causal effects may occur on the supply side or the demand side. Using a large national database of Medicare and non-Medicare patients, we investigate these issues for eight common preventive medical procedures. We find that preventive care is substantially higher with HMO coverage than with traditional fee-for-service reimbursement. Our findings also suggest that the impact of HMOs on preventive medicine is a causal one, and does not merely reflect selection effects. Both supply-side (e.g. provider) and demand-side (e.g. patient) factors appear to play a role in the higher incidence of preventive care among HMO enrollees. Patient demand effects are stronger for simple treatments such as physicals, while supply-side effects seem to dominate for relatively complex preventive care procedures such as mammograms.     

A physician role typology: colleague and client dependence in an HMO

This paper reports on physicians' role definitions in one prepaid group practice, a health maintenance organization (HMO). Colleague and client dependence are reviewed and analyzed as separable dimensions of physician role definitions. Data are derived from documents, interviews, and staff questionnaires collected in 1979-1980. The evidence reported suggests widespread colleague dependence in the HMO. Physicians consulted with one another about patient care and engaged in informal referral and review, developing practice standards; and some of these physicians relied on colleagues for handling their patient visits when needed. In relation to their patients, some physicians viewed themselves as bureaucratic officials relatively dependent on client approval in carrying out their health care activities, while others saw themselves as trusted medical experts in a setting free of nonmedical constraints in patient care. The relationship of organizational structure to these different role definitions is discussed. Classifying these HMO physicians according to a fourfold typology of professional dependence shows that most are Organizational Physicians (Type I), who are both colleague and client dependent. Collegial Physicians (Type II) are colleague dependent and, at the same time, do not perceive clients as demanding. Implications for quality of care and physician satisfaction and turnover are considered.     

Use of preventive care services,beneficiary characteristics,and Medicare HMO performance

Medicare health maintenance organization (HMO) enrollees use more preventive care services than their fee-for-service (FFS) counterparts. This may be because those who enroll in HMOs have characteristics that make them more disposed to use preventive care. To investigate this possibility, we examined the use of four preventive care services by respondents to the 1996 Medicare Current Beneficiary Survey (MCBS). Unadjusted preventive care use rates for HMO enrollees were slightly higher than rates for non-HMO enrollees with private supplemental insurance. However, after adjusting for enrollee characteristics (sociodemographics, health behaviors, health status, and functioning) we found that preventive care use rates for HMO enrollees were substantially higher--consistent with HMO enrollees being less disposed to use preventive care. In comparing preventive care service rates across groups, managers and policymakers may want to consider taking into account beneficiary characteristics that are correlated with the disposition to use preventive care.     

Mandatory HMO enrollment in Medicaid: the issue of freedom of choice

In areas where HMOs have enrolled a small proportion of the general population, physician participation is less in mandatory HMO programs for Medicaid beneficiaries than in fee-for-service Medicaid. But where HMOs have enrolled over one-quarter of the general population, participation rates are indistinguishable under the two systems. In those areas, mandatory enrollment restricts freedom of choice of provider. A plausible reason for this is that individual practice associations, which contract with large numbers of physicians with both fee-for-service and HMO patients, are becoming the lead form of HMO.     

Do Physicians Always Flee from HMOs? New Results Using Dynamic Panel Estimation Methods

OBJECTIVE: To assess the impact of changes in relative health maintenance organization (HMO) penetration on changes in the physician-to-population ratio in California counties when changes in the economic conditions in California counties relative to the U.S. average are taken into account. DATA SOURCES: Data on physicians who practiced in California at any time from 1988 to 1998 were obtained from the AMA Masterfile. The analysis was restricted to active, patient care physicians, excluding medical residents. Data on other covariates in the model were obtained from the Bureau of Economic Analysis, InterStudy, the Area Resource File, and the California state government. Data were merged using county FIPS codes. STUDY DESIGN: Changes in the physician-to-population ratio in California counties include the effects of both intrastate migration and interstate migration. A reduced-form model was estimated using the Arellano-Bond dynamic panel estimator. Economic conditions in California relative to the U.S. were measured as the ratio of county-level real per capita income to national-level real per capita income. Relative HMO penetration in California was measured as the ratio of county-level HMO penetration to HMO penetration in the U.S. relative HMO penetration was instrumented using five identifying variables to address potential endogeneity. Omitted-variable bias was controlled for by first differencing the model. The model also incorporated eight other covariates that may be associated with the demand for physicians: the percentage of the population enrolled in Medicaid, beds in short-term hospitals per 100,000 population, the percentage of the population that is black, the percentage of the population that is Hispanic, the percentage of the population that is Asian, the percentage of the population that is below age 18, the percentage of the population that is aged 65 and older, and the percentage of the population that are new legal immigrants in a given year. All of the above variables were lagged one period. The lagged physician-to-population ratio was also included to control for the supply of physicians. Separate equations were estimated for primary care physicians and specialist physicians. PRINCIPAL FINDINGS: Changes in lagged relative HMO penetration are negatively associated with changes in specialist physicians per 100,000 population. However, this effect of HMO penetration is attenuated and at times reversed in areas where the magnitude of the difference in relative economic conditions is sufficiently large. We did not find any statistically significant effects for primary care physicians. CONCLUSIONS: Consistent with prior studies, we find that changes in physician supply are associated with changes in relative HMO penetration. Relative economic conditions are an important moderator of the effect of changes in relative HMO penetration on physician migration.     

The impact of payor/provider type on health care use and expenditures among the frail elderly.

OBJECTIVES: This study examined whether health care expenditures and usage by the frail elderly differ under three payor/provider types: Medicare fee for service, Medicare health maintenance organization (HMO), and dual Medicare-Medicaid enrollment. METHODS: In-home interviews were conducted among 450 frail elderly patients of a San Diego, Calif, health care system. Cost and use data were collected from providers. RESULTS: Analyses revealed no difference in total expenditures between fee-for-service and HMO enrollees, but Medicare-Medicaid beneficiaries' expenditures were 46.8% higher than those for HMO enrollees and 52.2% higher than those for the fee-for-service group. Fee-for-service participants were less than half as likely as HMO enrollees to have two or more hospital admissions, but hospital usage rates between those two payor/provider groups did not differ. Not were there payor/provider differences in access to home health care, but HMO home health care users received significantly fewer services than the others. CONCLUSIONS: The care provided to these HMO beneficiaries resulted in a combination of restricted home health use and higher multiple hospitalizations. This raises compelling questions for future research. For the dually enrolled, stronger cost containment may be required.     

Geographic Distribution of Physician Manpower: the GMENAC Legacy*

ABSTRACT: The Graduate Medical Education National Advisory Committee (GMENAC) projected the need for and supply of physicians and other providers, recommended time and access standards for health care services, and developed guidelines for the geographic distribution of physicians. Since this study, analysts have given scant attention to national problems of physician geographic distribution. The issue deserves additional scrutiny in light of the current continuing problems of underservice in rural areas. The emergence of geographic information systems offers a unique opportunity to acquire data on provider distribution and provide a framework for developing and testing redistribution policy.     

HMO growth and the geographical redistribution of generalist and specialist physicians, 1987-1997

OBJECTIVE: To assess the impact of the growth in HMO penetration in different metropolitan areas on the change in the number of generalists, specialists, and total physicians, and on the change in the proportion of physicians who are generalists. DATA SOURCES/STUDY SETTING: The American Medical Association Physician Masterfile, to obtain the number of patient care generalists and specialists in 1987 and in 1997 who were practicing in each of 316 metropolitan areas in the United States. Additional data for each metropolitan area were obtained from a variety of sources, and included HMO penetration in 1986 and 1996. STUDY DESIGN: We estimated multivariate regression models in which the change in the number of physicians between 1987 and 1997 was a function of HMO penetration in 1986, the change in HMO penetration between 1986 and 1996, population characteristics and physician fees in 1986, and the change in population characteristics and fees between 1986 and 1996. Each model was estimated using ordinary least squares (OLS) and two-stage least squares (TSLS). PRINCIPAL FINDINGS: HMO penetration did not affect the number of generalist physicians or hospital-based specialists, but faster HMO growth led to smaller increases in the numbers of medical/surgical specialists and total physicians. Faster HMO growth also led to larger increases in the proportion of physicians who were generalists. Our best estimate is that an increase in HMO penetration of .10 between 1986 and 1996 reduced the rate of increase in medical/surgical specialists by 10.3 percent and reduced the rate of increase in total physicians by 7.2 percent. CONCLUSIONS: The findings of this study support the notion that HMOs reduce the demand for physician services, particularly for specialists' services. The findings also imply that, during the past decade, there has been a redistribution of physicians-especially medical/surgical specialists-from metropolitan areas with high HMO penetration to low-penetration areas.