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Study shows HMO penetration affects location
New physicians are more likely to locate in metropolitan areas without heavy HMO penetration, a study by the Santa Monica, CA-based RAND Corporation shows.
A research team headed by José Escarce, MD, PhD, tracked 75,000 new physicians who finished their graduate medical education between 1989 and 1994 and who located in a metropolitan area with more than 500,000 in population.
During the first years of the study, primary care physicians tended to locate in areas with a high managed care penetration, while new specialists did not seem to be affected by the presence of HMOs. By the end of the study, the amount of HMO penetration in an area had a negative effect on practice location for all new physicians, the study says.
The researchers concluded that primary care physicians are in high demand throughout the country and are choosing to avoid areas where they will be subjected to the pressures HMOs place on primary care physicians. Specialists find low demand for their services within a strong managed care market and are choosing other areas out of necessity, the study suggests.
"If our findings regarding HMO penetration are generalizable to other community sizes, continued HMO growth in large metropolitan areas may result in new physicians locating in smaller cities or non-metropolitan areas," the study says.
The RAND study is the first national study to examine the effect of HMOs on young physicians’ practice opportunities, says Jess Cook, spokes man for RAND. The study was published in the November issue of the journal Medical Care.