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The number of Medicaid-insured children enrolled in managed care plans is on the rise nationwide. Many commercial managed care plans are discontinuing their participation in Medicaid because of low reimbursement rates. Yet, a newly published study finds that Medicaid-insured and privately insured children in the same HMO had similar medical expenses.
Researchers compared the health care use and costs of children with Medicaid and children with commercial insurance within the same large California HMO between 1995 and 1997. Costs were adjusted for age, sex, and whether the child had joined the HMO within two months of birth.
Roughly 9% of Medicaid-insured children were medically needy, and 4% of Medicaid children were blind or disabled. Income-eligible Medicaid-insured and commercially insured groups of children had similar use of outpatient services such as clinic and hospital outpatient visits. However, Medicaid-insured medically needy children had significantly more clinic visits than their commercially insured counterparts, with an average of 5.2 visits compared to 3.6. Blind or disabled Medicaid children had significantly more hospital outpatient visits with .09, compared to .03, and clinic visits with an average of 5.6, compared to 3.6 for similarly challenged commercially insured children.
Other findings include:
• Overall, income-eligible Medicaid-insured and commercially insured children had costs of about $60 per month.
• The medically needy Medicaid-insured children cost $81 per month compared to $61 for commercially insured children who were medically needy. The difference in cost is attributed to $12 more per month for outpatient clinic visits and $3 more per month for emergency department costs.
• The greatest cost difference was found in Medicaid-insured blind and disabled children. These children cost $277 per month compared to $61 for their commercially insured counterparts.
[See: Ray GT, Lieu T, RM Weinick, et al. Comparing the medical expenses of children with Medicaid and commercial insurance in an HMO. Am J of Man Care 2000; 6(7):753-760.]