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Agency for Healthcare Research Quality

Strengthening Managed Care

Research in Action

The face of America's medical systems has changed dramatically in the last decade as private market forces have transformed how health care is provided and purchased. Largely in reaction to spiraling costs, managed care is becoming the dominant health care delivery system. The number of Americans in health maintenance organizations (HMOs) is rising fast, from 15 million in 1984 to more than 50 million today.


Managed care—interdependent systems that integrate the financing and delivery of health care services—differ in how they deliver care, ease of access to care, flexibility in physician choice, and services covered. Much remains to be learned about the long-term effects of managed care on access, cost, and quality of care.

AHCPR—Catalyst for Change

The Agency for Health Care Policy and Research (AHCPR) actively supports studies of these rapid changes and is working with the private sector to reach a consensus on how to increase quality and accountability in health care.

By providing information on the effectiveness of alternative systems and management practices and by spotlighting both successes and problems, AHCPR will help improve the health care marketplace. AHCPR is the only Federal agency looking at what works and what doesn't in the real world—and at the quality of care received for the almost $1 trillion dollars spent on health care each year.

Key Findings

Recent AHCPR-supported research provides important insights:

  • HMO doctors spent more time with their patients in one study than fee-for-service doctors, and their patients received more preventive care, asked more questions, and were more involved in treatment planning. Family physicians were studied at a large HMO and three fee-for-service groups.
  • Managed care patients spent 2 fewer days in an intensive care unit (ICU) than patients with fee-for-service health insurance, with the average stay for managed care patients costing $8,000 less. There was no difference in mortality or ICU readmission between the two groups. Patients were treated in the same teaching hospital by the same ICU specialists.
  • HMO patients were hospitalized 40 percent less than patients with fee-for-service plans and treated in solo practices. The study of 20,000 persons examined variations in health care delivery systems. Patient outcomes findings will be published shortly.
  • Fewer low birthweight infants and cost savings resulted from a self-help smoking cessation program for prenatal care patients of Maxicare Health Plans, a large HMO. Women in the program were 45 percent less likely to give birth to low birthweight infants. More than $3 in medical costs were saved for every $1 spent.
  • Group practice outpatient clinic patients had shorter stays and incurred lower costs at a Cleveland hospital, but received the same quality of care as traditional clinic patients at the hospital.
  • Chronically ill patients in managed care plans had better access to care than patients in fee-for-service plans, but their care was not as comprehensive, they waited longer for care, and physician-patient continuity was less in a study of 1,200 patients in three cities.

Research Under Way

AHCPR is studying issues critical to finding out what works best:

  • Switching Medicaid beneficiaries to managed care and the effect on access to health services is being studied in Washington State. The number of Medicaid recipients in managed care plans doubled in 1994.
  • Impact of continuous quality improvement on delivery of preventive services at primary care clinics is being investigated at two managed care organizations in Minnesota.
  • Effect of specialty training on primary care practice is being studied at Kaiser Permanente of Northern California. Factors being studied include the number of tests ordered and other services used, patient outcomes, and costs.
  • Adequacy of followup of patients with abnormal screening mammograms is being studied at the Henry Ford Health System in Detroit.
  • Compliance with guidelines for pediatric preventive care and cancer screening and the impact of incentives are being investigated in two studies at a Medicaid HMO in Philadelphia.
  • Methods of pain management of primary care doctors are being studied to determine if they are associated with different risks of dysfunctional chronic pain among patients with back pain and headache at Group Health Cooperative of Puget Sound.

New Rural Research

By many measures, rural populations are in poorer health than most nonrural groups. In a major initiative, AHCPR has awarded five grants to support innovative demonstrations of health care delivery in five States. Many important innovations—such as managed care—are often unavailable in rural areas:

Goals of the initiative include:

  • Promoting establishment of managed care institutions and development of rural health networks. These efforts should lay groundwork for planning future statewide or regional managed care systems to enhance access to rural health services.
  • Demonstrating how to improve rural care through innovations in the organization, financing, and delivery of health care services. In a project with a rural hospital alliance, participants may use the Oklahoma Telemedicine Network and its telemedicine training center to improve access to health care services.

Guideline Use

  • Implementation of AHCPR guidelines is being studied at HMOs in Oregon and Washington State. Studies are assessing the effectiveness of working with clinical opinion leaders and of continuous quality improvement as interventions that may promote incorporation of guidelines into daily practice.
  • Scripps Clinic, an integrated medical network, gives the Consumer Version of AHCPR's acute pain management guideline to elective surgery patients. Each year 2,000 patients are trained to use the guideline's pain intensity scale, which helps staff manage postsurgical pain effectively.

New Initiatives

Studying health care markets is a major focus of AHCPR research:

  • A year-long AHCPR nationwide survey will estimate health care and out-of-pocket family costs for persons with managed care plans. The Third National Medical Expenditure Survey will also estimate how many people have managed care benefits.
  • Analyses that examine how changes in market structures have affected the way health care providers produce and market care and the price, distribution, and quality of services available will be supported by a new initiative. Collaborative research with managed care organizations is encouraged.
  • Appropriate use of specialists by managed care organizations will be the subject of a conference now being planned.

Kaiser Permanente (Anaheim) drew directly on an AHCPR guideline when revising its pain management practices. Referring to surgery patients below age 5 who benefit from the recommended preventive approach of pain management, Kaiser anesthesiologist Dr. Nathan Mann says, "The children are not crying and screaming in agony now."

Intermountain Health Care tested the AHCPR pressure ulcer prevention guideline in 1 of its 24 hospitals for 6 months and found it reduced the incidence of pressure ulcers significantly, saving the system $240,000. The Salt Lake City-based health care system is implementing the guideline in its 23 other hospitals.

AHRQ, a part of the Department of Health and Human Services, is the lead agency charged with supporting research designed to improve the quality of health care, reduce its cost, and broaden access to essential services. AHRQ's broad programs of research, clinical guideline development, and technology assessment bring practical, science-based information to medical practitioners and to consumers and other health care purchasers.

AHCPR Publication No. 96-P045
Current as of June 1996

Internet Citation:

Strengthening Managed Care. Research in Action Fact Sheet. AHCPR Publication No. 96-P045, June 1996. Agency for Health Care Policy and Research, Rockville, MD.


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