New Research Brings Needed Evidence to the Debate on Managed Care

Media Advisory Date: November 10, 1997

New studies supported by the Agency for Health Care Policy and Research (AHCPR) and published in today's issue of the journal, Health Affairs, present the first comprehensive look at what is currently happening in the health care marketplace.

The articles form an invaluable evidence-based core of information for current discussions of policy options by all health care system participants—both public and private.

"The role of AHCPR is not simply to describe the health care world, but to disseminate information that will help those who seek to improve it," said John M. Eisenberg, M.D., M.B.A., AHCPR's administrator. "These articles provide fundamental knowledge about the link between the financing and delivery of health care and the quality of services."

AHCPR's studies empirically and rigorously examine issues of how current, incentive-driven market decisions of multiple participants—hospitals, physicians, health plans, employers, employees, and public, private and individual purchasers—determine who gets health care, what kind of care, how much care, who pays and how much.

A brief look at the AHCPR studies shows that:

• In Segmentation of Hospital Markets: Where Do HMO Enrollees Get Care?, José J. Escarce and colleagues suggest that HMOs may not systematically channel their enrollees to high-volume, low-mortality hospitals.
• In Which Types of Hospital Mergers Save Consumers Money?, Robert A. Connor and colleagues find that, overall, horizontal mergers benefit consumers but more antitrust scrutiny is needed.
• Jan P. Clement and others in Strategic Hospital Alliances: Impact on Financial Performance, find that when hospitals form strategic alliances, their revenues increase but their costs do not.
• Lawton R. Burns and colleagues question prevailing tools used for analyzing market evolution in Managed Care, Market Stages, and Integrated Delivery Systems: Is There a Relationship? Their findings indicate that these tools seem better at producing a snapshot of markets rather than distinguishing sequential stages of development.
• In The Provision of Primary Care: Does Managed Care Make a Difference?, Carol J. Simon and co-researchers find that in response to managed care, physicians have been specializing more, and this is linked to their involvement in managed care.
• In Effects of HMO Penetration on Physicians' Work Effort and Satisfaction, Jack Hadley and Jean M. Mitchell document the extent and nature of physicians' reservations about how they now practice medicine.
• In HMO Market Structure and Performance: 1985-1995, Douglas R. Wholey and colleagues take a comprehensive look at a decade of managed care data and find evidence confirming the widely held perception that hospital days are declining among HMO patients, while use of ambulatory care is up. Their analysis not only documents the role of plan competition but also provides a closer look at the differential patterns of competition for different kinds of managed care organizations.
• William M. Sage points out in Judge Posner's RFP: Antitrust Law and Managed Care, that the dearth of empirical data on competition in the managed care market leads to theoretical guesses in our courts of law. His paper calls for sound empirical information that can be used in the formulation, appropriate enforcement, and litigation of antitrust law.
• David Colby points out in his paper, Doctors and Their Discontents, that despite dramatic changes in physicians' autonomy, medicine continues to be an attractive profession.
• Michael H. Bailit argues in A Purchaser's View of Health Care Market Trends, that a decline in competition and few rewards for higher-quality care threaten the health of the managed care marketplace.
• Finally, AHCPR researchers Philip F. Cooper and Barbara Steinberg Schone find in More Offers, Fewer Takers for Employment-Based Health Insurance: 1987 and 1996, that as many as six million Americans are not choosing to accept health insurance even when offered it. The study found that the number of workers declining employment-based health increased by 140 percent between 1987 and 1996. Those most likely to turn down insurance are young (under age 25), single, Hispanic or black, and work for low wages. Possible factors driving this trend include the decline in real wages, higher employee contribution rates, and state legislation aimed at enhancing insurance coverage which may have increased costs. The study was based on data from AHCPR's new Medical Expenditure Panel Survey and its 1987 National Medical Expenditure Survey.

Health Affairs is the health policy journal published by Project HOPE, 7500 Old Georgetown Road, Suite 600, Bethesda, MD 20814-6133; (301) 656-7401.

For additional information, contact AHCPR Public Affairs: Karen Migdail, (301) 427-1855 (KMigdail@ahrq.gov) or Salina Prasad (SPrasad@ahrq.gov).

Internet Citation:

New Research Brings Needed Evidence to the Debate on Managed Care. Press Release, November 10, 1997. Agency for Healthcare Research and Quality, Rockville, MD. http://www.ahrq.gov/news/press/mancare.htm

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