Effects of Medicaid managed care programs on health services access and use

OBJECTIVE: To estimate the effects of Medicaid managed care (MMC) programs on Medicaid enrollees' access to and use of health care services at the national level. DATA SOURCES/STUDY SETTING: 1991-1995 National Health Interview Surveys (NHIS) and a 1998 Urban Institute survey on state Medicaid managed care programs. STUDY DESIGN: Using multivariate regression models, we estimated the effect of living in a county with an MMC program on several access and use measures for nonelderly women who receive Medicaid through AFDC and child Medicaid recipients. We focus on mandatory programs and estimate separate effects for primary care case management (PCCM) programs, health maintenance organization (HMO) programs, and mixed PCCM/HMO programs, relative to fee-for-service (FFS) Medicaid. We control for individual and county characteristics, and state and year effects. DATA COLLECTION/EXTRACTION METHOD: This study uses pooled individual-level data from up to five years of the NHIS (1991-1995), linked to information on Medicaid managed care characteristics at the county level from the 1998 MMC survey. PRINCIPAL FINDINGS: We find virtually no effects of mandatory PCCM programs. For women, mandatory HMO programs reduce some types of non-emergency room (ER) use, and increase reported unmet need for medical care. The PCCM/HMO programs increase access, but had no effects on use. For children, mandatory HMO programs reduce ER visits, and increase the use of specialists. The PCCM/HMO programs reduce ER visits, while increasing other types of use and access. CONCLUSIONS: Mandatory PCCM/HMO programs improved access and utilization relative to traditional FFS Medicaid, primarily for children. Mandatory HMO programs caused some access problems for women.     

A Cost Analysis of the Iowa Medicaid Primary Care Case Management Program

Objective. To determine the cost savings attributable to the implementation and expansion of a primary care case management (PCCM) program on Medicaid costs per member in Iowa from 1989 to 1997.
Data Sources. Medicaid administrative data from Iowa aggregated at the county level.
Study Design. Longitudinal analysis of costs per member per month, analyzed by category of medical expense using weighted least squares. We compared the actual costs with the expected costs (in the absence of the PCCM program) to estimate cost savings attributable to the PCCM program.
Principal Findings. We estimated that the PCCM program was associated with a savings of $66 million to the state of Iowa over the study period. Medicaid expenses were 3.8 percent less than what they would have been in the absence of the PCCM program. Effects of the PCCM program appeared to grow stronger over time. Use of the PCCM program was associated with increases in outpatient care and pharmaceutical expenses, but a decrease in hospital and physician expenses.
Conclusions. Use of a Medicaid PCCM program was associated with substantial aggregate cost savings over an 8-year period, and this effect became stronger over time. Cost reductions appear to have been mediated by substituting outpatient care for inpatient care.     

Medicaid Managed Care and Health Care for Children

Objective. Many states expanded their Medicaid managed care programs during the 1990s, causing concern about impacts on health care for affected populations. We investigate the relationship between Medicaid managed care enrollment and health care for children.
Data Sources and Measures. Repeated cross-sections of Medicaid-covered children under 18 years of age from the 1996/1997 and 1998/1999 Community Tracking Study Household Surveys ( n =2,602) matched to state-year CMS Medicaid managed care enrollment data. For each individual, we constructed measures of health care utilization (provider and emergency department visits, hospitalizations, surgeries); health care access (usual source of care, unmet medical needs, put-off needed care); and satisfaction (satisfaction overall, with doctor choice, and with last visit).
Study Design. Regression analysis of the relationship between within-state changes in Medicaid managed care enrollment rates and changes in mean utilization, access, and satisfaction measures for children covered by Medicaid, controlling for a range of potentially confounding factors.
Principal Findings. Increases in Medicaid health maintenance organization (HMO) enrollment are associated with less emergency room use, more outpatient visits, fewer hospitalizations, higher rates of reporting having put off care, and lower satisfaction with the most recent visit. Medicaid primary care case management (PCCM) plans are associated with increases in outpatient visits, but also with higher rates of reporting unmet medical needs, putting off care, and having no usual source of care.
Conclusions. Both Medicaid HMO and PCCM plans can have important impacts on health care utilization, access, and satisfaction. Some impacts may be positive (e.g., less ED use and more outpatient provider use), although concern about increasing challenges in access to care and satisfaction is also warranted.     

Effect of different types of Medicaid managed care on childhood immunization rates

Medicaid managed care can improve access to prevention services, such as immunization, for low-income children. The authors studied immunization rates for 7,356 children on Medicaid in three managed care programs: primary care case management (PCCM; n = 4,605), a voluntary HMO program (n = 851), and a mandatory HMO program (n = 1,900). Immunization rates (3:3:1 series) in PCCM (78%) exceeded rates in the voluntary HMO program (71%), which in turn exceeded those in the mandatory HMO program (67%). Adjusting for race, urban residence, and gender, compared to children in PCCM, children in the voluntary HMO program were less likely to complete the 3:3:1 series (OR = 0.75, CI = 0.63, 0.90), and children in the mandatory HMO program were even less likely to complete the series (OR = 0.59, CI = 0.51, 0.68). Results differed by individual HMOs. Monitoring of outcomes for all types of managed care by Medicaid agencies is imperative to assure better disease prevention for low-income children.     

Primary care case management and birth outcomes in the Iowa Medicaid program.

OBJECTIVES: This study compares prenatal care utilization and birth outcomes between Iowa Medicaid recipients receiving care in a primary care case management (PCCM) system and those receiving care in a fee-for-service (FFS) system. METHODS: Birth certificates linked with Medicaid hospitalization claims were analyzed for seven PCCM and seven FFS counties. RESULTS: From 1989 through 1992, there was (1) a 20% increase in the number of women who received adequate prenatal care in the FFS counties, vs a 5% increase in the PCCM counties; (2) a 17% increase in the number of women who initiated care within the first trimester in the FFS counties, vs a 6% increase in the PCCM counties; and (3) a 442% increase in the number of women who received enhanced prenatal services in the FFS counties, vs a 278% increase in the PCCM counties. There were no significant differences between groups in mean gestational age or birthweight; however, there was an increase of very-low-birthweight babies in both groups. CONCLUSIONS: PCCM, as implemented by the Iowa Medicaid program, has not appreciably improved prenatal care utilization or birth outcomes.     

Quality oversight in medicaid primary care case management programs

As health maintenance organizations (HMOs) have curtailed participation in Medicaid, enrollment in primary care case management (PCCM) programs has grown. To examine state Medicaid agencies' monitoring of PCCM and HMO programs, we surveyed Medicaid agency directors of forty-six states and the District of Columbia. Agencies were less likely to collect performance data in PCCM programs than in HMO programs. Few PCCM programs reported performance results for the public or providers. Reporting states tended to emphasize utilization results over quality-measure results. Despite growing enrollment, PCCM programs appear less likely to use the quality-oversight strategies employed by Medicaid health plans.     

Access, satisfaction, and utilization in two forms of Medicaid managed care

We determined access and satisfaction of 2,598 recipients of Virginia's Medicaid program, comparing its health maintenance organizations (HMOs) to its primary care case management (PCCM) program. Positive responses were summed as sub-domains either of access, satisfaction, or of utilization, and adjusted odds ratios were calculated for HMO (vs. PCCM) sub-domain scores. The response rate was 47 per cent. We found few significant differences in perceived access, satisfaction, and utilization. Both HMO adults and children more often perceived good geographic access (adults, OR, [CI] = 1.50, [1.04-2.16]; children, OR, [CI] = 1.773 [1.158, 2.716]). But HMO patients less often reported good after-hours access (adults, OR, [CI] = 0.527 [0.335, 0.830]; children, OR, [CI] = 0.583 [0.380, 0.894]). Among all patients reporting poorer function, HMO patients more often reported good general and preventive care (OR, [CI] = 2.735 [1.138, 6.575]). We found some differences between Medicaid HMO versus PCCM recipients' reported access, satisfaction, and utilization, but were unable to validate concerns about access and quality under more restrictive forms of Medicaid managed care.     

A randomized trial to evaluate the effectiveness of a Medicaid HMO

The value of health-care services used by AFDC Medicaid patients receiving care in a voluntary enrollment HMO is contrasted with that of health care services used by Medicaid patients receiving fee-for-service (FFS) care. The randomized assignment of Medicaid recipients to the HMO or to FFS allows the authors to conclude that the apparent lower use of HMO enrollees results from the HMO's selection of patients with lower needs for care rather than from technical efficiency. Patients had lower use while in the HMO, but disenrollees and those who refused enrollment had significantly higher use than FFS participants. In contrast to the effect of HMOs on non-Medicaid populations, the Medicaid HMO studied provided significantly fewer outpatient services, but the same level of inpatient services as the FFS sector. Overall, voluntary enrollment of Medicaid eligibles into the HMO resulted in higher state expenditures for Medicaid because of favorable selection.     

Social/health maintenance organization and fee-for-service health outcomes over time

Evaluating the performance of long-term care (LTC) demonstrations requires longitudinal assessment of multiple outcomes where selective mortality and disenrollment, if not accounted for, can give the appearance of reduced (or enhanced) efficacy. We assessed outcomes in social/health maintenance organizations (S/HMOs) and Medicare fee-for-service (FFS) care using a multivariate model to estimate active life expectancy (ALE). S/HMO enrollees and samples of FFS clients in four sites were analyzed and outcome differences assessed for a 3-year period. Results provide insights into S/HMO performance under different conditions and, more generally, into evaluating LTC demonstrations without randomized client and control groups.     

Service-level selection by HMOs in Medicare

In the federal Medicare program, contracting health maintenance organizations (HMOs) are paid on a capitated basis. There has long been concern that an "adverse selection" of risks remain in the traditional fee-for-service (FFS) sector, since beneficiaries with low costs may leave the FFS sector and join the HMOs. The distortion associated with this form of selection is that health plans may design their mix of health care services in order to effectuate favorable selection. This paper scrutinizes patterns of HMO membership and costs by service in the FFS sector for evidence consistent with the hypothesis that HMOs engage in service-level product distortion. We develop a multi-service model of choice between FFS and HMOs and show that if the HMO sector is underproviding (overproviding) a service relative to the FFS sector, we should observe a positive (negative) correlation between the HMO market share and average costs of those remaining in the FFS sector. We estimate the correlation between the HMO market share and the average FFS costs for different health care services using Medicare data for 1996. We find evidence indicating that there exists significant service-level selection by HMOs.     

PMH15 Development of a Self-Administered Outcome Measure for use in an Outpatient Population of Individuals with Schizophrenia

Insurers' influence on patterns of care and disease management continues to be questioned in the U.S.
OBJECTIVE: To determine the effect managed care has on length of stay (LOS) and costs of inpatient management of schizophrenia in acute general hospitals.
METHODS: LOS and cost estimates were developed based on patient-level data from the 1996 Massachusetts discharge database. Analyses were limited to patients with a principal diagnosis of schizophrenia (based on ICD9 codes). Three populations were examined: an all payer group, a standard Medicaid coverage group, and those with a Medicaid-funded managed care plan (MMC). Unique patient identifiers enabled examination of annual admission frequency. All costs are reported in 1996 US$, adjusted appropriately for cost-to-charge ratios.
RESULTS: Of the 3,500 patients admitted for schizophrenia, 582 (17%) were covered by Medicaid and 419 (12%) by MMC. Overall, patients were admitted an average of 1.7 times in the year, with 67% having only one admission. The mean admission rate was 1.8 among Medicaid patients and 1.6 with MMC; a single admission occurred in 73% of the Medicaid group and 67% for MMC. The mean LOS was 14 days for the Medicaid group compared to 13.5 days for the all payer group and 12.3 days for those with MMC. Among those with only one admission, the differences increases: 16.4 days for the Medicaid group, 14.7 days for the all payer group, and 12.9 for the MMC group. Costs for this admission were correspondingly highest for standard Medicaid ($10,864) and lowest for MMC ($7,911).
CONCLUSION: The managed care approach decreases the length of stay and cost of inpatient management of schizophrenia. The appropriateness of these reductions remains unclear.     

Evaluating health care programs by combining cost with quality of life measures: a case study comparing capitation and fee for service

Objective. To demonstrate cost-effectiveness analysis (CEA) for evaluating different reimbursement models.
Data Sources/Study Setting. The CEA used an observational study comparing fee for service (FFS) versus capitation for Medicaid cases with severe mental illness ( n =522). Under capitation, services were provided either directly (direct capitation [DC]) by not-for-profit community mental health centers (CMHC), or in a joint venture between CMHCs and a for-profit managed behavioral health organization (MBHO).
Study Design. A nonparametric matching method (genetic matching) was used to identify those cases that minimized baseline differences across the groups. Quality-adjusted life years (QALYs) were reported for each group. Incremental QALYs were valued at different thresholds for a QALY gained, and combined with cost estimates to plot cost-effectiveness acceptability curves.
Principal Findings. QALYs were similar across reimbursement models. Compared with FFS, the MBHO model had incremental costs of −$1,991 and the probability that this model was cost-effective exceeded 0.90. The DC model had incremental costs of $4,694; the probability that this model was cost-effective compared with FFS was <0.10.
Conclusions. A capitation model with a for-profit element was more cost-effective for Medicaid patients with severe mental illness than not-for-profit capitation or FFS models.     

Workers' compensation cost shifting: an empirical study.

It has been suggested that health maintenance organizations (HMOs) overdiagnose work-related injuries and illnesses to increase their income. This study compared the Workers' Compensation experience of 2,176 Boston postal employees enrolled in a large HMO with that of 3,473 employees enrolled in a large fee-for-service health insurance plan. It controlled for the potential confounders of age, gender, job classification, type of injury, and duration of employment. It found no difference in the incidence of injuries: 5.93% for HMO enrollees and 6.25% for fee-for-service plan enrollees. Medical costs averaged $475 for HMO enrollees and $838 for fee-for-service plan enrollees (p = 0.018). Total costs averaged (09 for HMO enrollees and $1388 for fee-for-service plan enrollees (p = 0.063). In our cohort, there was no evidence of cost shifting. It appeared that the HMO provided less expensive medical care for injured postal workers.     

Managed care and preventable hospitalization among Medicaid adults

OBJECTIVE: The study examines the association between managed care enrollment and preventable hospitalization patterns of adult Medicaid enrollees hospitalized in four states. DATA SOURCES/STUDY SETTING: Hospital discharge data from the Healthcare Cost and Utilization Project (HCUP) database of the Agency for Healthcare Research and Quality (AHRQ) for New York (NY), Pennsylvania (PA), Wisconsin (WI), and Tennessee (TN) residents in the age group 20-64 hospitalized in those states, linked to the Area Resource File (ARF) and American Hospital Association (AHA) survey files for 1997. STUDY DESIGN: The study uses separate logistic models for each state comparing preventable admissions with marker admissions (urgent, insensitive to primary care). The model controls for socioeconomic and demographic variables, and severity of illness. PRINCIPAL FINDINGS: Consistently in different states, private health maintenance organization (HMO) enrollment was associated with fewer preventable admissions than marker admissions, compared to private fee-for-service (FFS). However, Medicaid managed care enrollment was not associated with a reduction in preventable admissions, compared to Medicaid FFS. CONCLUSIONS: Our analysis suggests that the preventable hospitalization pattern for private HMO enrollees differs significantly from that for commercial FFS enrollees. However, little difference is found between Medicaid HMO enrollees and Medicaid FFS patients. The findings did not vary by the level of Medicaid managed care penetration in the study states.     

How does managed care manage the frail elderly? The case of hospital readmissions in fee-for-service versus HMO systems

OBJECTIVES: This study examined whether hospital readmissions varied among the frail elderly in managed care versus fee-for-service (FFS) systems. SETTING AND PARTICIPANTS: Random sample of 450 patients, aged 65 and over, from a large vertically integrated health care system in San Diego, California. Participants were receiving physician-authorized home health and survived and 18-month follow-up period. MAIN OUTCOME MEASURES: Multiple logistic regression analyses were used to conduct comparisons of readmissions and preventable readmissions by plan type. Two methods to identify preventable readmissions were developed, one based on a computerized algorithm of service use patterns, and another based on blind clinical review. RESULTS: The odds of having a preventable hospital readmission within 90 days of an index admission were 3.51 (P = 0.06) to 5.82 (P = 0.02) times as high for Medicare HMO enrollees compared to Medicare FFS participants, depending on the method used to assess preventability. Readmission patterns were similar for Medicare HMO enrollees and FFS study participants dually enrolled in Medicare and Medicaid. CONCLUSION: In this group of frail elderly Medicare beneficiaries, those enrolled in an HMO were more likely to have a preventable hospital readmission than those receiving care under FFS. These results suggest that policies promoting stringent approaches to utilization control (e.g., early hospital discharge, reduced levels of post-acute care, and restricted use of home health services) may be problematic for the frail elderly.     

Evaluating Medicaid HMOs when encounter data are missing: case of developmentally delayed children

In evaluating Medicaid Health Maintenance Organizations (HMOs), crucial information regarding severity of illness of patients is often missing – in part because encounter data are not available. If we assume that patients are either in the HMO or in fee-for-service (FFS) plans (i.e., no in or out migration); then severity of HMO patients can be deduced from encounters of FFS patients. We applied this approach to effectiveness of HMO services for developmentally delayed children. Data supported the assumption of a closed system. Data also showed that over 12 months, severity of FFS patients declined. Therefore, we inferred that the HMO was attracting sicker patients. The HMO was paid less than FFS plan, despite the fact that it attracted sicker patients.     

SCHIP structure and children's use of care

This study explores the impact of program structure on children's use of care by comparing care use in State Children's Health Insurance Program (SCHIP) and Medicaid covered populations in a State where children share the same provider network and are both in a primary care case management system with the same Medicaid fee structure. We then compare care use in this system to care use in an SCHIP structured as a fee-for-service (FFS) system using a private insurance provider network and fee schedule. Where SCHIP and Medicaid Programs share a primary care case management (PCCM) system, we find more use of well-child care among Medicaid covered children, but more use of office-based physician care among SCHIP covered children. Across the Medicaid PCCM-based and the private insurance FFS-based system, we find more use of primary and specialty care in the FFS system, and more use of well-child care and less use of emergency departments for non-urgent care in the PCCM-based system.     

Enrollee health status under Medicare risk contracts: an analysis of mortality rates.

Previous studies comparing the health status of Medicare beneficiaries enrolled under HMO risk contracts to that of Medicare beneficiaries in fee-for-service (FFS) have generally focused on demonstration projects conducted before 1985. This study examines mortality rates in 1987 for approximately 1 million aged Medicare beneficiaries enrolled in 108 HMOs. We estimated adjusted mortality ratios (AMR) for each HMO and across all HMOs, by dividing the actual number of deaths among HMO enrollees by the "expected" number of deaths. The expected number of deaths was based on death rates among local FFS populations, adjusting for age, sex, Medicaid buy-in status, and institutional status. The AMR for all HMO enrollees pooled together was 0.80. For persons newly enrolled in 1987, the AMR was 0.69; in general, AMRs were higher for beneficiaries who had been enrolled for longer periods of time. Among individual HMOs, none exhibited an AMR substantially above 1.00. Regression analysis indicated lower AMRs for staff model HMOs than for either IPA or group models. Low mortality among Medicare HMO enrollees is consistent with favorable selection or with improvements in the health status of enrollees due to better access or quality of care in HMOs. In either case, health status differences between HMO enrollees and FFS beneficiaries have implications for the appropriateness of Medicare's Adjusted Average Per Capita Cost (AAPCC) payment formula for HMOs.     

Medicaid Managed Care and Health Care Access for Adult Beneficiaries with Disabilities

Objective. To evaluate the impact of Medicaid managed care organizations (MCO) on health care access for adults with disabilities (AWDs).
Data Sources. Mandatory and voluntary enrollment data for AWDs in Medicaid MCOs in each county were merged with the Medical Expenditure Panel Survey and the Area Resource File for 1996–2004.
Study Design. I use logit regression and two evaluation perspectives to compare access and preventive care for AWDs in Medicaid MCOs with FFS. From the state's perspective, I compare AWDs in counties with mandatory, voluntary, and no MCOs. From the enrollee's perspective, I compare AWDs who must enroll in an MCO or FFS to those who may choose between them.
Principal Findings. Mandatory MCO enrollees are 24.9 percent more likely to wait >30 minutes to see a provider, 32 percent more likely to report a problem accessing a specialist, and 10 percent less likely to receive a flu shot within the past year. These differences persist from the state evaluation perspective.
Conclusions. States should not expect a dramatic change in health care access when they implement Medicaid MCOs to deliver care to the adult disabled population. However, continued attention to specialty care access is warranted for mandatory MCO enrollees.