FFS Enrollees Research Articles

Medicare Managed Care Spillovers and Treatment Intensity.

Evidence suggests that the share of Medicare managed care enrollees in a region affects the costs of treating traditional fee-for-service (FFS) Medicare beneficiaries; however, little is known about the mechanisms through which these 'spillover effects' operate. This paper examines the relationship between Medicare managed care penetration and treatment intensity for FFS enrollees hospitalized with a primary diagnosis of AMI. I find that increased Medicare managed care penetration is associated with a reduction in both the costs and the treatment intensity of FFS AMI patients. Specifically, as Medicare managed care penetration increases, FFS AMI patients are less likely to receive surgical reperfusion and mechanical ventilation and to experience an overall reduction in the number of inpatient procedures. Copyright © 2015 John Wiley & Sons, Ltd.

Adverse Events for Hospitalized Medicare Patients: Is There a Difference between HMO and FFS Enrollees?

The study examines the likelihood of adverse outcomes associated with selected hospital safety events for two groups of Medicare patients: those enrolled in health maintenance organizations (HMOs) versus those enrolled in fee-for-service (FFS) insurance plans. The authors hypothesize that HMO patients may receive different qualities of hospital services and/or physician services relative to FFS patients. Based on the Healthcare Cost and Utilization Project State Inpatient Database, the authors include discharge data on all hospitalized elderly Medicare patients in Florida in 2002 and use multivariate logistic regression models with adjustments for hospital-level clusters. The findings demonstrate that, after adjusting for hospital quality, Medicare HMO patients were at higher risk of adverse outcomes than Medicare FFS patients for iatrogenic pneumothorax, accidental puncture or laceration, and postoperative respiratory failure.

Do Medicare Advantage enrollees tend to be admitted to hospitals with better or worse outcomes compared with fee-for-service enrollees?

The hospitals selected by or for Medicare beneficiaries might depend on whether the patient is enrolled in a Medicare Advantage (MA) plan. A theoretical model of profit maximization by MA plans takes into account the tradeoffs of consumer preferences for annual premium versus outcomes of care in the hospital and other attributes of the plan. Hospital discharge databases for 13 states in 2006, maintained by the Agency for Healthcare Research and Quality, are the main source of data. Risk-adjusted mortality rates are available for all non-maternity adult patients in each of 15 clinical categories in about 1,500 hospitals. All-adult postoperative safety event rates covering 9 categories of events are calculated for surgical cases in about 900 hospitals. Instrumental variables are used to address potential endogeneity of the choice of a MA plan. The key findings are these: enrollees in MA plans tend to be treated in hospitals with lower resource cost and higher risk-adjusted mortality compared to Fee-for-Service (FFS) enrollees. The risk-adjusted mortality measure is about 1.5 percentage points higher for MA plan enrollees than the overall mean of 4%. However, the rate of safety events in surgical patients favors MA plan enrollees--the rate is 1 percentage point below the average of 3.5%. These discrepant results are noteworthy and are plausibly due to greater discretion by the health plan in approving patients for elective surgery and as well as selecting hospitals for surgical patients. Emergency patients are generally excluded for the safety outcome measures. In addition, the current mortality measures may not adequately represent all surgical patients. Such caveats should be prominently highlighted when presenting comparative data. With that proviso, the study justifies informing Medicare beneficiaries about the mortality and safety outcome measures for hospitals being used by a MA plan compared to hospitals used by FFS enrollees.

Managed care and the near-elderly: effects of plan enrollment on functionality

This paper examines the effects of enrollment in a health maintenance organization (HMO) or a preferred provider organization (PPO) on the functional status of near-elderly adults (aged 55–64), compared to traditional fee-for-service (FFS) plans. A sample of 1306 near-elderly adults with employer-sponsored health insurance are drawn from the 2000–2002 waves of the Health and Retirement Study, a nationally representative panel survey of community-dwelling adults. Regression models are estimated to assess the effects of different types of insurance plans on functionality, as measured by whether or not the individual has any functional limitations. The potential influence of selection bias into alternative types of plans is addressed by limiting the sample to near-elders without a choice of health plans. The effects of HMOs on functionality are shown to be comparable to those of FFS plans among the general near-elderly population. However, significant adverse effects of HMO enrollment on functional status are observed among near-elders with chronic conditions. PPO enrollees have similar functional outcome to FFS enrollees, even among those with chronic conditions. The observed differences in functional outcome across plans have important implications for the practicality of managed care plans serving older adults.

The Effectl of Insurance Type on Prescription Drug Use and Expenditures among Elderly Medicare Beneficiaries

The debate over the impact of the new Medicare prescription drug benefit (Part D) has intensified in anticipation of its implementation. This paper contributes additional information related to the effect of different types of prescription drug coverage plans on use and expenditures among elderly Medicare beneficiaries. Crosssectional design using data from the 2002 Medical Expenditures Panel Survey (MEPS). The two dependent variables were (1) prescription drug use and (2) expenditures. The main independent variable was the type of drug insurance (Medicare FFS only [no Rx insurance], Medicare FFS + Rx insurance and Medicare HMO). Bivariate and multivariate analyses were used to test the effect of insurance type, and beneficiaries’ characteristics, on likelihood and level of drug use, as well as expenditures. The findings showed that average total drug expenditures among Medicare FFS enrollees who had Rx insurance (non-HMO) were higher ($182.51) than that of Medicare FFS enrollees with no Rx insurance. In addition, the former group had a higher likelihood (any use) of using prescribed medications. On the other hand, no differences in the likelihood of use were detected between Medicare HMO and Medicare FFS (no Rx insurance) enrollees. However, Medicare HMO enrollees had a higher level of drug use. In conclusion, The differences in drug use and expenditures by insurance type imply that each party (Medicare, Medicare Advantage plans, employers) will have a different set of dis/incentives for involvement in Medicare Part D.

Caregivers’ Ratings of Access

The objective of this study was to evaluate how enrollment in a partially capitated managed care (MC) option versus the fee-for-service (FFS) system affects caregivers' ratings of dimensions of access to services among children with special health care needs (SHCN). The data were collected from telephone interviews during the summer and fall of 2002 with a random sample of 1088 caregivers of children with SHCN who qualified for Supplemental Security Income and therefore were enrolled the Medicaid program for children with SHCN in the District of Columbia. We used a 2-step procedure in which we first estimated plan choice and then constructed a selectivity correction to control for the potential selection bias linked to plan choice. We estimated the second stage equations predicting caregiver's ratings of dimensions of access as a function of the selectivity correction, the plan choice dummy variable and other exogenous variables. After controlling for the potential selection bias linked to plan choice and other confounding factors, we find that caregivers of children in FFS are significantly more likely than caregivers of children enrolled in the partially capitated MC plan to rate the following dimensions of access as either fair or poor: "access to specialists' care" (P < 0.01), "access to emergency room care" (P < 0.01), "convenience of the doctor's office" (P < 0.01), and "waiting time between making the appointment actual visit" (P < 0.05). We attribute these differences in caregivers' ratings of dimensions of access that exist between partially capitated MC and FFS enrollees to case management and care coordination services along with higher fees paid for pediatrician's and specialists' services available under MC option.

Factors Affecting Plan Choice and Unmet Need among Supplemental Security Income Eligible Children with Disabilities

To evaluate factors affecting plan choice (partially capitated managed care [MC] option versus the fee-for-service [FFS] system) and unmet needs for health care services among children who qualified for supplemental security income (SSI) because of a disability. We conducted telephone interviews during the summer and fall of 2002 with a random sample of close to 1,088 caregivers of SSI eligible children who resided in the District of Columbia. We employed a two-step procedure where we first estimated plan choice and then constructed a selectivity correction to control for the potential selection bias associated with plan choice. We included the selectivity correction, the dummy variable indicating plan choice and other exogenous regressors in the second stage equations predicting unmet need. The dependent variables in the second stage equations include: (1) having an unmet need for any service or equipment; (2) having an unmet need for physician or hospital services; (3) having an unmet need for medical equipment; (4) having an unmet need for prescription drugs; (5) having an unmet need for dental care. More disabled children (those with birth defects, chronic conditions, and/or more limitations in activities of daily living) were more likely to enroll in FFS. Children of caregivers with some college education were more likely to opt for FFS, whereas children from higher income households were more prone to enroll in the partially capitated MC plan. Children in FFS were 9.9 percentage points more likely than children enrolled in partially capitated MC to experience an unmet need for any type of health care services (p<.01), while FFS children were 4.5 percentage points more likely than partially capitated MC enrollees to incur a medical equipment unmet need (p<.05). FFS children were also more likely than partially capitated MC enrollees to experience unmet needs for prescription drugs and dental care, however these differences were only marginally significant. We speculate that the case management services available under the MC option, low Medicaid FFS reimbursements and provider availability account for some of the differences in unmet need that exist between partially capitated MC and FFS enrollees.

Plan Choice and Changes in Access to Care over Time for SSI-Eligible Children with Disabilities

This paper analyzes how voluntary enrollment in the fee-for-service (FFS) system versus a partially capitated managed care plan affects changes in access to care over time for special needs children who receive Supplemental Security Income (SSI) due to a disability. Four indicators of access are evaluated, including specialty care, hospital care, emergency care, and access to a regular doctor. We employ the Heckman two-step estimation procedure to correct for the potential nonrandom selection bias linked to plan choice. The findings show that relative to their counterparts in the partially capitated managed care plan, SSI children enrolled in the FFS plan are significantly more likely to encounter an access problem during either of the time periods studied. Similarly, FFS enrollees are significantly more likely than partially capitated managed care participants to experience persistent access problems across three of the four dimensions of care. Possible explanations for the deterioration in access associated with FFS include the lack of case management services, lower reimbursement relative to the partially capitated managed care plan, and provider availability.

Medicaid managed care prescription use and cost savings.

To evaluate the impact of Medicaid managed care (MC) enrollment on prescription use and costs. Retrospective, cross-sectional analysis of claims submitted over a 6-month period. Ohio Medicaid. Stratified, random selection of 2,932 MC and 1,335 fee-for-service (FFS) recipients. Dependent variables were the probability of any prescription use and 6-month prescription counts and costs. Independent variables included age, plan enrollment (MC or FFS), county enrollment status (mandatory or voluntary), presence of a chronic comorbidity, and any outpatient medical visit. After adjusting for comorbidities and outpatient medical visits, plan enrollment effects depended on age. FFS enrollees 8 to 12 and 12 to 18 years old were less likely (adjusted odds ratios 0.56 and 0.58, respectively) to receive a prescription, while enrollees over 30 years of age were 2.98 times more likely to receive a prescription. Among prescription users, level of use and costs were consistent across all ages for MC enrollees. FFS enrollees had 25% to 218% higher levels of prescription use than MC enrollees, depending on age. Prescription costs were 8% lower for FFS enrollees ages 4 to 8 but higher for all enrollees in other age groups (range, 22% to 311% higher). Prescription use and costs were lower for Medicaid MC enrollees than they were for patients in traditional FFS plans. Further research is needed to examine the quality of care for both FFS and MC enrollees.

A Longitudinal Evaluation of the Effect of Medi-Cal Managed Care on Supplemental Security Income and Aid to Families With Dependent Children Enrollees in Two California Counties

We examined the differential effect of Medicaid managed care (MMC) among Aid to Families With Dependent Children (AFDC) and Supplemental Security Income (SSI) enrollees over time by comparing the experiences of adult nonelderly enrollees in the Health Plan of San Mateo in California versus Ventura County's fee-for-service (FFS) enrollees. Four years of administrative claims data were used to construct a longitudinal data set and estimate panel data models to decompose the effect of managed care over time. AFDC MMC enrollees exhibited generally fewer ambulatory visits, lower expenditures, and higher monthly probabilities of a preventable hospitalization relative to comparably enrolled FFS patients. SSI MMC enrollees had more emergency department visits and higher monthly probabilities of hospitalization. However, SSI MMC enrollees had more ambulatory visits and more medications during the first year of enrollment relative to SSI FFS enrollees, although levels were similar in subsequent years. SSI MMC enrollees did not exhibit a significantly higher level of expenditures in the first year of enrollment, although in subsequent years, expenditure levels were significantly lower. The results for emergency department visits and preventable hospitalizations presented a decidedly downbeat picture of access to care for AFDC and SSI enrollees in MMC. However, some aspects of utilization under managed care exhibited results consistent with long-term- oriented treatment for enrollees with a greater likelihood of remaining in the system for a longer period of time (SSI enrollees). By contrast, enrollees more likely to be enrolled for shorter periods (AFDC enrollees) tended to exhibit care patterns under MMC consistent with lower levels of care relative to FFS.

Capitated Medicaid and the Process of Care of Elderly Hypertensives and Diabetics: Results From a Randomized Trial

To measure the quality of care for hypertensive and diabetic elderly Medicaid beneficiaries enrolled in managed care versus fee-for-service (FFS) plans. Individuals enrolled in the Medicaid Demonstration Project in Hennepin County, Minnesota, were randomly assigned to receive their care either in one of seven managed care health plans in which the Medicaid payment for their care was capitated or in an FFS plan. Two hundred ninety-one hypertensives and 96 diabetics who were aged 65 years or over at the beginning of the evaluation were interviewed at baseline and followed for 1 year. Drug and nondrug therapy, monitoring, monthly medication costs, and access to medications were assessed. The prepaid and FFS did not differ in drug or nondrug therapy, with the exception that slightly more FFS enrollees were on human insulin after 1 year. Mean monthly medication costs and access to medications were similar for both groups. In this randomized trial, we were unable to detect differences in the process of care for hypertensive and diabetic Medicaid enrollees.