A new study on managed care performance by two University of California researchers doesn’t supply a simple answer to the pressing question: Does managed care result in better or worse quality of care?
"The evidence says that managed care is better than, the same as and worse" than fee-for-service care, noted Robert H. Miller, Ph.D., associate professor of health economics at the University of California, San Francisco, and co-author of the study, which was published in the September/October issue of Health Affairs.
Dr. Miller and co-author Harold S. Luft, Ph.D., analyzed 37 studies on managed care performance published in peer-reviewed journals. Fifteen studies focused on quality of care while others examined enrollee satisfaction and hospital and physician resource use.
Evidence on quality of care was mixed, with HMOs performing both significantly better and significantly worse than non-HMO plans. Quality of care was better for a population of Medicaid elderly. However, Medicare HMO enrollees with chronic conditions tended to fare worse than their non-HMO counterparts.
Evidence on hospital and physician resource use was inconclusive and enrollee satisfaction results varied by enrollee type, with low-income enrollees generally expressing greater satisfaction with managed care than fee-for-service care.
In the future, researchers need to focus on the impact on patient subpopulations and on specific features of managed care that might account for differences in performance, the survey concludes.
"Global comparisons only take you so far," agrees an official from the Health Care Financing Administration (HCFA). The more pressing issues, some researchers and policymakers say, are how can managed care in general be improved and what forms of managed care work best for which enrollee populations.
"There’s pretty strong evidence that certain types of capitated arrangements can contain costs," Dr. Miller said. "The question is: What kinds of capitated arrangements improve quality of care as well? People just don’t know what they’re getting."
Chris Conover, Ph.D., assistant research professor at Duke University’s Center for Health Policy, Law and Management, said the conflicting results from managed care can be partly attributed to the fact that there are different service categories for the privately insured, publicly insured and the uninsured. In the airline industry, Dr. Conover observes, ratings of quality and satisfaction to some extent depend on "where you’re seated and what your expectations are."
Dr. Conover and other researchers from Duke and Vanderbilt universities have done a side-by-side comparison of the
TennCare program and North Carolina’s fee-for-service Medicaid program. The results, which are expected to be reported early next year, are compatible with the University of California’s study’s findings that Medicaid recipients had greater satisfaction and better quality of care in managed care, he said.
"If I was a Medicaid person . . . I would have to conclude that I’d rather be in managed care.—Conover
"If I was a Medicaid person looking at the evidence and being objective about it, I would have to conclude that I’d rather be in managed care than in Medicaid fee-for-service," Dr. Conover said.
One exception might be Medicaid patients with chronic illness, he said. But, even that may be too much of a generalization, given the variability of Medicaid fee-for-service care across states.
"If you’re chronically ill [and on Medicaid], I’m guessing that in states where you have a particularly good fee-for-service system, you’ll end up concluding that managed care doesn’t quite cut it and you’re better off staying with fee-for-service," Dr. Conover said. "But, I can picture the Medicaid fee-for-service system being so bad that even the chronically ill are better off in managed care."
The impact on enrollee subgroups "ultimately will be the litmus test" for managed care, especially in Medicaid, predicts Stephen A. Somers, Ph.D., president of the Center for Health Care Strategies.
Gordon Bonnyman, a lawyer at the Tennessee Justice Center, a public interest law firm in Nashville, said that although they would be useful, valid comparisons between Medicaid managed care and fee-for-service are difficult to do. "The data systems that we had in Medicaid fee-for-service weren’t very good for making comparisons, and it’s very hard to go back," he noted. Mr. Bonnyman said he believes TennCare eventually will be able to supply data that describe its enrollees’ experiences with treatment outcomes and access to care, but "we’re not quite there yet."
HCFA evaluations
HCFA has contracted with several independent evaluators to analyze the impact of prepaid managed care on Medicaid populations in several states, including Tennessee, Rhode Island, Hawaii, Oklahoma, Illinois, Minnesota and Vermont. Many of these evaluations are for five years. Delaware’s Diamond State Health Plan evaluation will focus on the effects on children, including children with special needs. Reports on how prepaid managed care has impacted safety nets in many of these states is expected to be released early next year as well as reports on how these states handle encounter data.
Marsha Gold, Sc.D., a senior fellow for Mathematica Policy Research, Inc., which is performing several Medicaid evaluations for HCFA, noted that as more states turn to managed care to transform their Medicaid programs, learning from the experience of other states is more important than ever. "From a policy perspective, probably the most important question is: How do you best create an oversight framework that promotes good managed care?"
The Agency for Health Care Policy and Research (AHCPR) recently issued a request for proposals (RFP) under an initiative, called "Quality of Care Under Varying Features of Managed Care Organizations." The initiative, which is co-sponsored by the American Association of Health Plans Foundation, will provide up to $7 million to fund four to seven research proposals.
"We really are at the point where we need to start focusing on what features of managed care are more likely to produce high quality than other features of managed care," said Irene Fraser, Ph.D., director of the AHCPR’s Center for Organization and Delivery Studies. Managed care is a catch-all phrase for organizations that have all sorts of different reimbursement mechanisms and features. The research projects will attempt to link different aspects of managed care with outcome and quality-of-care measures, she explained.
Dr. Miller believes three things are needed to improve managed care overall: risk-adjusted payment structures, better information on quality for consumers and purchasers and greater speed in changing and improving clinical processes. Amid predictions of premium increases for the first time in several years, managed care organizations may find themselves in a bind if they can’t show that they are delivering on quality, he noted "If costs can’t be contained enough and quality is not demonstrably better, then the backlash against HMOs could increase a good deal," Dr. Miller observes. That raises the stakes for greater insight into outcomes and quality under managed care.
—Mary Darby
Contact Dr. Miller at 510-339-7220; Mr. Bonnyman at 615-255-0331; Dr. Conover at 919-684-8026; Dr. Gold at 202-844-9220; Dr. Somers at 609-279-0700 and AHCPR at 301-594-1364. For research from HCFA’s Office of State Health Reform Demonstrations, call Jamie Hadley at 410-786-6626.
Latest survey of managed care research finds mixed track record on quality of care, satisfaction
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