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Mays Web Exclusive
H E A L T H T R A C K I N G
M A R K E T W A T C H
W E B E X C L U S I V E
11 August 2004
MarketWatch:
Managed Care Rebound?
Recent Changes In Health Plans’
Cost Containment Strategies
Strategies from the first wave
of managed care have crept back into the practices of health plans.
By Glen P. Mays, Gary Claxton,
and Justin White
ABSTRACT:
Large increases in health
care costs combined with an economic slowdown have created pressures for health
plans and employers to reconsider cost containment strategies that were scaled
back after the managed care backlash. In this paper we examine how plans’
approaches to cost containment and care management have evolved since 2001.
Plans reintroduced and refocused some utilization management techniques during
2002 and 2003 while continuing to invest in disease and case management. Some
also began to experiment with new variants of managed care, including tiered
provider networks and incentive-based provider payments. However, few respondents
believed that these strategies alone would greatly reduce future costs.
Health care spending and private health insurance premiums have increased rapidly
in recent years, raising new questions about the sustainability of these trends.1
During the early 1990s rapid spending growth and the resulting pressure from
employers and other purchasers prompted health plans to adopt more aggressive
approaches for containing costs that collectively became known as managed care.2
Use of these approaches—including selective provider networks, provider
risk contracting, primary care gatekeeping, and utilization review—increased
steadily in many health insurance markets during the 1990s, as did enrollment
in health maintenance organizations (HMOs), the most restrictive form of managed
care.3 By 2000, however, growing consumer and provider
dissatisfaction with managed care and persistently tight labor markets led employers
to adopt less restrictive insurance products and health plans to discontinue
or scale back their cost containment efforts.4 According
to some observers, these developments signaled the end of managed care as a
defining feature of the U.S. health insurance industry.5
This suggests that private insurance markets may no longer provide sufficient
pressure for health care cost containment and efficiency.
Most recently, large increases in health insurance premiums combined with an
economic slowdown have created pressures for health plans and employers to reconsider
approaches for managing care and containing costs.6
One plausible response is to shift a greater proportion of health care costs
to consumers through premium contributions, copayments, and deductibles. However,
these actions may have only a limited impact on overall cost trends, create
financial barriers to needed health care, and potentially result in fewer consumers’
taking up insurance coverage.7 Another response
is to revisit the cost containment strategies of managed care under the assumption
that recent premium increases and slack labor markets have made employers and
employees willing to accept more restrictive health insurance products. This
paper explores these possibilities by examining how insurers’ approaches
to cost containment and care management have evolved since 2001. Study findings
provide insight into the continued viability of market-driven approaches to
cost containment in health insurance.
Data And Methods
Data for our analysis were collected as part of the Community Tracking Study
(CTS), a longitudinal study that uses multiple data sources including site visits
and national surveys to examine how local health care systems are changing.8
As part of this study, site visits are made every two years to twelve metropolitan
communities that were randomly selected to be nationally representative of local
health care systems in markets with more than 200,000 residents: Boston, Cleveland,
Greenville (South Carolina), Indianapolis, Lansing, Little Rock, Miami, northern
New Jersey, Orange County (California), Phoenix, Seattle, and Syracuse. Collectively,
these communities provide a picture of the average local health care system,
yet they vary considerably in size, market structure, and experience with managed
care (Exhibit
1).
During four rounds of CTS site visits, in 1996–97, 1998–99, 2000–01,
and 2002–03, structured interviews were conducted in each community with
decisionmakers in leading health plans, hospitals, physician organizations,
employers, insurance brokerages, and legislative and regulatory bodies at state
and local levels. Approximately 1,000 interviews were completed during the fourth
round of visits, including approximately 260 interviews with executives from
71 health plans. In each community we interviewed administrators of at least
one national health plan, local or regional health plan, Blue Cross/Blue Shield
plan, and a plan serving primarily Medicaid beneficiaries. In each of these
plans we attempted to interview the chief executive officer (CEO), medical director,
marketing executive, network development executive, utilization management director,
and pharmacy benefit administrator. To ensure adequate coverage of the major
health plan competitors, we interviewed executives at up to two additional health
plans in each community, including major preferred provider organization (PPO)
plans, as well as one or more third-party administrators (TPAs) for self-insured
employers.
Health plan interviews asked about changes in the design and operation of health
insurance products and about the rationale and perceived impact of these changes.
In this paper we focus specifically on health plans’ approaches to cost
containment, including utilization management processes, disease and case management
programs, provider contracting and network development strategies, and benefit
design and cost-sharing arrangements. To confirm and expand upon this information,
we also inquired about health plans’ cost and care management approaches
during interviews with employers, benefit consultants, insurance brokers, hospitals,
and physician organizations. Data from each interview were coded, extracted,
and analyzed using text analysis software. Interview responses were analyzed
both within and across the twelve communities to examine how the use of cost
containment approaches varies across health plans and local markets. In this
paper we give primary focus to information obtained during the fourth round
of CTS site visits conducted in 2002–03, and we compare this information
with that obtained and reported in previous rounds of the study.9
Results
After discontinuing or relaxing many managed cost containment tools during 2000
and 2001, sizable numbers of health plans have refined and refocused these approaches
during the past two years in an effort to moderate the recent growth in health
care costs and use. Refinements included selective reintroduction of utilization
management techniques; expanded investments in disease and case management programs;
and development of restricted provider networks and new provider incentive programs
designed to encourage efficient clinical practice. Although far from being adopted
universally, these changes were pursued by some of the largest, most visible
insurers in the communities studied, perhaps providing a preview of what is
to come. Although these leading health plans are using more than just higher
cost sharing to constrain premium growth, relatively few expect that their current
approaches will have large near-term effects on cost trends.
Utilization management.
Health plans in six of the twelve study communities reintroduced prior authorization
requirements for selected services after having eliminated these requirements
(Exhibit
2). In northern New Jersey, for example, Aetna eliminated prior authorization
requirements for approximately fifty inpatient and outpatient services in its
HMO and PPO products during 2000–01 but reinstated many of them during
2002–03 after experiencing sharp increases in health care use. Similarly,
Excellus BlueCross BlueShield in Syracuse reinstated prior authorization requirements
for specialist referrals within its HMO product after finding that referral
rates increased markedly when these requirements were eliminated during 2002.
These health plans noted that although many services subject to prior authorization
are rarely denied, the requirements often discourage requests for services that
are not considered medically necessary. However, health plans in five communities
continued to eliminate prior authorization requirements for hospitalizations,
noting that inpatient care was less likely than other types of services to be
discretionary.
In reintroducing prior authorization requirements, health plans have targeted
those services that offer little or no clinical benefit while being careful
not to reduce access to potentially beneficial services. In many cases, the
new prior authorization requirements were less restrictive than those the plans
had used previously. In Seattle, for example, Regence BlueShield adopted a policy
requiring prior authorization only after a patient has exceeded an established
utilization threshold, such as a third magnetic resonance imaging (MRI) scan
or a tenth chiropractor visit. This policy was adopted for both its HMO and
PPO products. In several other markets, health plans have replaced prior authorization
requirements with more lenient notification policies that oblige patients or
their physicians, or both, to advise the plan of an impending procedure or service
to receive full coverage. These plans provide partial coverage for the designated
services if advance notification is not received.
Health plans in five communities have stepped up their efforts to review hospital
stays concurrently in an effort to reduce lengths-of-stay and eliminate unnecessary
diagnostic tests and procedures received in the hospital (Exhibit
2). Some plans recently have begun to station utilization review nurses
in frequently used hospitals to monitor patient care, while other plans have
adopted new telephone-based review procedures in an effort to cover more hospitals
with fewer staff. In Miami, for example, Blue Cross and Blue Shield of Florida
reintroduced an in-hospital concurrent review program in 2002 after finding
that the hospitalist program it had created to replace concurrent review did
not reduce unnecessary hospital days and costs.
Although most plans historically have used concurrent review processes only
in HMOs, several plans introduced these approaches into their PPOs in 2002–03,
as these products have become more popular and costly. One plan moved from in-person
to telephone-based concurrent review specifically to begin using it in its PPO
hospital network, which was much larger than the HMO network in which in-person
reviews had been used. In an effort to reduce the administrative costs of conducting
concurrent reviews, some health plans have adopted processes for reviewing inpatient
cases only after stays have exceeded an established outlier threshold based
on the patient’s diagnosis and severity. Additionally, several plans have
begun to use concurrent review processes in non-hospital-based settings such
as skilled nursing and rehabilitation facilities and for ongoing outpatient
services such as physical, occupational, and speech therapy. Plans noted the
steady growth in spending for these services as the primary rationale for these
changes.
Health plans in nine communities have introduced or expanded initiatives for
reviewing health care claims retrospectively and profiling providers based on
indicators of health care use and quality. These plans varied widely in the
types of providers profiled, the measures of use and quality reviewed, and the
ways in which this information is used. A large Seattle insurer, for example,
recently introduced a claims review system to detect targeted instances of inappropriate
care delivered by hospitals and physicians in both its HMO and PPO products
so that the plan could follow up with problematic providers and, in some cases,
withhold payment for the services. In Greenville, a health plan began collecting
comparative data on physician use and costs to use as part of its contract negotiations,
while a Lansing health plan introduced a system for profiling physicians in
its HMO using Health Plan Employer Data and Information Set (HEDIS) measures
of quality and providing comparative feedback reports to encourage improvements
Many of these plans reported making sizable investments in their information
systems during 2002–03 to support retrospective review and profiling applications.
Unlike the trends observed for some prior authorization and utilization review
requirements, we saw no resurgence in the use of primary care gatekeeping requirements
among plans in the study communities. During 2000– 01 health plans increasingly
moved away from these requirements by introducing open-access HMOs and PPOs
as alternatives to traditional gatekeeper HMOs. Enrollment in these open-access
products continued to grow during 2002–03, but most health plans retained
their gatekeeper HMO products as lower-cost insurance options.
Disease and case management.
Health plans continued to expand disease and case management programs in 2002–03
in an effort to improve care and reduce costs for patients with chronic and
complex health conditions. Plans in at least half of the study communities added
new disease management programs during this period, while many other plans took
steps to expand participation in their existing programs (Exhibit
3). A Lansing health plan, for example, recently added programs for osteoporosis
and back pain to its array of offerings that already included programs for congestive
heart failure, asthma, diabetes, and depression. Other plans have made existing
disease management programs available to more members. For example, health plans
in Seattle and Greenville previously offered disease management only in their
HMOs but recently began offering these programs to their PPO members as well.
Health plans have begun to move beyond traditional disease management to more
targeted approaches that seek to identify and address the health care needs
of high-risk patients who are likely to generate high health care costs.10
Unlike traditional disease management, these approaches focus on managing the
health care needs of high-risk patients through intensive and customized case
management, instead of emphasizing standardized, disease-specific interventions
that apply to an entire population of members. Health plans in nine communities
have adopted intensive case management programs combined with “predictive
modeling” applications that use health care claims data and health risk
assessments to identify members with utilization patterns or complex health
conditions that suggest they are likely to generate sizable health care costs
in the future. Most of these plans implemented such programs in both HMOs and
PPOs. By identifying high-risk members prospectively, these plans expect to
lower future health care costs through avoiding delays in receipt of needed
health care, coordinating health care delivery and eliminating redundant care,
and encouraging member self-management of health conditions.
Many plans have introduced intensive case management and predictive modeling
applications alongside their traditional disease management programs. These
plans view member-focused case management programs as “filling in the gaps”
by serving members with complex conditions and health care needs that are not
addressed by existing treatment protocols and standardized care plans. However,
other health plans have adopted intensive case management as an alternative
to traditional disease management programs that are viewed as ineffective or
of benefit to limited numbers of members. In Seattle, Regence Blue Shield discontinued
most of its disease management programs—including programs for diabetes,
asthma, and cardiovascular disease—in 2002 and replaced them with an intensive
case management program linked to predictive modeling. Similarly, in Miami,
UnitedHealthcare chose to emphasize intensive case management rather than disease
management in its Medicare+Choice plan because of the large number of members
who have multiple health conditions that would not be addressed by a single
disease management program.
Network design and provider
contracting. In
contrast to the emphasis placed on broad and inclusive provider networks in
previous years, some health plans have begun to experiment with new products
that restrict provider choice in order to achieve cost savings. Health plans
in Syracuse, Orange County, and Miami introduced new PPO and exclusive provider
organization (EPO) products in 2002–03 that offer a more limited choice
of hospitals and physicians than is available in the standard PPO and HMO products
in these markets. One Orange County plan, for example, expected to include only
about half of its contracted physicians and hospitals in its new PPO product
under development and expected to sell this product for 10–15 percent less
than its standard PPO product.
Similarly, health plans in at least half of the communities have begun to experiment
with tiered provider networks, which group providers into tiers based on measures
of the cost of care they deliver and then encourage patients to choose providers
in the lower-cost tiers through reduced cost sharing.11
In Orange County and Boston, plans have developed tiered networks for hospitals
only, while in Seattle and Miami, plans have included both physicians and hospitals
in the tiers. However, most plans have experienced considerable operational
difficulties with these products, including methodological challenges in differentiating
providers based on cost measures and resistance from large hospitals and medical
groups. In Cleveland and Indianapolis, several hospitals have preemptively negotiated
contract language that precludes these types of products, and in other markets
large hospital systems have threatened to drop out of the network altogether
unless they are placed in preferred tiers. Moreover, both providers and employers
have expressed concern that quality of care typically is not considered when
forming tiers—a limitation that some health plans have begun to address.
Most of the tiered-network products launched to date exclude relatively few
providers from the preferred tiers and therefore offer relatively modest savings
over traditional, single-network products. Moreover, enrollment in these products
has been light in most communities.
We found no evidence of a resurgence in the use of capitated payment arrangements
for providers in the study communities. Some health plans previously had used
these arrangements in HMOs to encourage providers to reduce health care use
and costs, but they were scaled back or abandoned in many communities during
2000 and 2001 as a result of provider resistance and the growing demand for
open-access products.12 Since that time, plans
in many communities have moved to fee-for-service (FFS)–based payment systems
for both HMO and open-access products, with a few exceptions. Some plans continue
to use capitated payments with physician organizations that have developed the
infrastructure to operate successfully under this form of payment—an occurrence
observed more frequently in Orange County than in the other study communities.
Moreover, health plans in several communities continue to use capitated provider
payment systems only in their Medicaid and Medicare HMOs, noting that such cost
containment arrangements allow the products to remain financially viable.
Although the use of capitation remains limited, health plans in most of the
study communities have begun to experiment with new incentive payment systems
designed to reward providers for the quality and efficiency of care they deliver.
Fifteen plans in seven communities have introduced new financial incentives
for physicians and hospitals that are based on measures of quality and efficiency
(Exhibit
3). Health plans in Seattle, Syracuse, and Orange County began piloting
programs that encourage physicians to prescribe lower-cost generic drugs rather
than brand-name drugs and offer them a percentage of the cost savings that result.
In Lansing, one plan began offering hospitals higher payments in exchange for
reducing medication errors and achieving other patient-safety standards, while
another plan introduced physician incentives tied to HEDIS quality measures.
Similar HEDIS-based incentive programs were launched by plans in Boston, Northern
New Jersey, and Orange County during 2002–03.
Some plans viewed these new financial incentives as replacements for capitated
provider payment methods that had been used previously in HMOs.13
Whereas capitation was used primarily as a cost containment strategy, these
new incentives are being used to address both cost and quality issues. Moreover,
some plans have begun to introduce these types of incentives not only in HMO
networks but also in much larger PPOs. For example, Blue Cross of California
introduced an incentive payment and recognition program for its 15,000 PPO network
physicians based on measures of quality in chronic illness care and efficiency
in generic prescribing.
Benefit design and cost
sharing. Nearly
all of the health plans we studied reported increasing consumer cost-sharing
requirements during 2002–03 in an effort to control escalating premium
costs. Continuing a trend noted in 2000–01, plans have increased copayment
and deductible levels, added deductibles to HMOs that previously offered first-dollar
coverage, and introduced coinsurance into both HMOs and PPOs that previously
offered fixed-dollar copayments.14 In Seattle,
Group Health Cooperative of Puget Sound departed from its long-standing tradition
of offering only HMOs with first-dollar coverage by introducing a deductible
HMO in 2002 with annual deductible options ranging from $200 to $500 for individuals.
This product reportedly offered a premium 10–15 percent below the plan’s
standard HMO, thereby helping the plan compete with lower-price PPOs in the
market. Similarly, a large plan in Miami introduced an EPO in 2002 that included
coinsurance rates of 20–30 percent for most services rather than the $10
and $20 copayments common in other products, reportedly allowing the plan to
offer a premium 15–20 percent below those of its closest competitors. The
growing popularity of this product prompted several other Miami health plans
to develop similar coinsurance products.
Additionally, health plans in all but one of the study communities introduced
variants of consumer-directed plans during 2002–03 to give employers additional
options for premium savings. These products provide members some first-dollar
coverage for health expenses through member-directed spending accounts or other
mechanisms, and they require expenses to be paid out of pocket once this coverage
is exhausted until an established spending threshold (or deductible) is reached.
Most of these products use a PPO provider network as their platform and function
like a traditional PPO once the spending threshold is met.
Health plans indicate that consumer-directed products offer employers lower
premiums than traditional HMOs and PPOs by shifting more costs to consumers
and encouraging consumers to be more economical in their patterns of service
use. Nevertheless, employers’ interest in consumer-directed products has
remained tepid in most markets, and enrollment has been modest, with some exceptions.
In Seattle, Regence Blue Shield’s new product attracted considerable attention
among small businesses and the state’s subsidized health insurance program
because of premiums 10–15 percent below those of traditional PPOs and a
design that offers full coverage for an initial set of routine services including
office visits, diagnostic and laboratory services, and preventive care. Nevertheless,
many employers remained skeptical that these products could offer sizable cost
savings without substantial reductions in the benefits offered to employees.
Discussion
Recent increases in health care use and costs have prompted health plans to
revisit some of the cost containment strategies that were discontinued or relaxed
in the wake of the managed care backlash. Health plans reinstituted selected
cost controls during 2002– 03, although in many cases these controls are
less stringent than those employed before the backlash. Health plans have also
begun to apply these controls in a broader range of health insurance products,
recognizing that HMOs now serve only a small segment of the market in most communities.
Collectively, these developments suggest that at least some of the concepts
and tools of managed care remain viable in the current health insurance marketplace.
Although these tools’ viability appears secure, many health plans, employers,
and other stakeholders question their ability to alter future health care cost
trends. Although health plans continued to invest in disease and case management
programs during 2002–03, most report relatively limited evidence of cost
savings.15 For many plans, these programs need
to operate for longer periods of time and achieve higher rates of membership
participation before sizable cost savings could be expected. Most of the tiered-network
products launched to date offer only modest price advantages over traditional
products because relatively few providers are excluded from the preferred tiers.
Moreover, enrollment in these products has remained low in most markets, which
indicates that their near-term effects on health care costs will be limited.
Many of the provider incentive programs adopted to date cover only selected
providers and offer relatively modest financial rewards, which suggests that
the incentives may not be sufficiently strong or widespread to induce large-scale
changes in clinical practice.
Because most health plans are still relatively early in their experience with
disease management, tiered networks, and provider incentive systems, the effects
of these arrangements on health care costs will depend on how they mature and
evolve over time. If tiered networks become more selective and better able to
target cost-effective providers, they could begin to place downward pressure
on costs. Similarly, the savings from disease management programs and provider
incentive systems may increase over time as they reach larger numbers of eligible
patients and providers. The success of all of these approaches will hinge in
part on health plans’ ability to gain the acceptance and cooperation of
physicians and other providers. In the wake of the managed care backlash, most
plans remain cautious about imposing new requirements and constraints on hospitals
and physicians. Moreover, health plans lack the bargaining power to impose such
requirements on the large, consolidated health care providers that have emerged
in many markets. Instead, plans are focusing on improving provider relationships
through better communication and smoother business transactions. Whether these
activities will lead to increased provider engagement in cost containment and
care management activities remains to be seen.
Employers’ and consumers’ interest in cost containment approaches
is also essential for their success, and such interest may grow over time if
health insurance premiums continue to rise rapidly. Because health plans’
current approaches place relatively few limits on health care choices, consumers
and employers may find them preferable to more restrictive managed care tools.
If so, these approaches could become increasingly important features of health
plan design and have moderating effects on health care costs.
Nevertheless, current approaches do little to address the most powerful driver
of long-term cost growth: advancements in medical technology.16
This casts doubt on the extent to which they can truly contain costs. The array
of administrative controls and financial incentives in use in 2002–03 lacked
the sensitivity and specificity required to differentiate alternative treatment
options based on their clinical effectiveness and steer both providers and patients
toward the most cost-effective options. Addressing these gaps would require
much more aggressive efforts to evaluate new technologies prior to making decisions
about coverage, and much more intricate and differentiated systems of incentives
for both providers and patients.17 Developing and
implementing such a comprehensive evaluation and incentive system would likely
require policy action at the federal, state, or local levels, since individual
health plans would likely face intractable technological challenges and provider
resistance. Without such approaches, the long-term cost growth experienced during
the past four decades appears likely to continue unabated.
In the absence of more systematic approaches to cost containment, health plans
have continued to develop products and options that allow employers to buy down
their premiums through higher consumer cost sharing. Because patients faced
with higher cost sharing tend to cut back on both discretionary and needed care,
these responses may contribute to reduced access to care and, ultimately, poorer
health outcomes, particularly for seriously ill and low-income populations.18
If cost sharing continues to increase, consumers may begin to demand products
with more cost containment and care management features, particularly those
such as tiered networks that offer consumers a trade-off between costs and choice
of providers. These possibilities underscore the need for continued efforts
to refine and improve such features of health plan design, even if employers
appear more focused on cost sharing than cost containment.
This research was conducted as part of the Community Tracking Study at the
Center for Studying Health System Change and was funded by the Robert Wood Johnson
Foundation.
NOTES
1. M.E. Chernew, R.A. Hirth, and D.M. Cutler, “Increased
Spending on Health Care: How Much Can the United States Afford?” Health
Affairs 22, no. 4 (2003): 15–25; and D.E. Altman and L. Levitt, “The
Sad History of Health Care Cost Containment as Told in One Chart,” Health
Affairs, 23 January 2002, content.healthaffairs.org/cgi/content/abstract/hlthaff.w2.83
(21 June 2004).
2. S. Glied, “Managed Care,” in Handbook of Health
Economics, ed. A.J. Culyer and J.P. Newhouse (Amsterdam: North-Holland,
2000), 707–753.
3. See, for example, J. Gabel, “Ten Ways HMOs Have Changed
during the 1990s,” Health Affairs 16, no. 3 (1997): 134–145;
M. Gaynor and D. Haas-Wilson, “Change, Consolidation, and Competition in
Health Care Markets,” Journal of Economic Perspectives 13, no. 1
(1998): 141–164; and J. Zwanziger, G.A. Melnick, and A. Bamezai, “The
Effect of Selective Contracting on Hospital Costs and Revenues,” Health
Services Research 35, no. 4 (2000): 849–867.
4. See, for example, R.J. Blendon et al., “Understanding
the Managed Care Backlash,” Health Affairs 17, no. 4 (1998): 80–94;
C.S. Lesser and P.B. Ginsburg, “Retreat from Managed Care: How Local Healthcare
Systems Changed, 1997–1999,” in Understanding Health System Change:
Local Markets, National Trends, ed. P.B. Ginsburg and C.S. Lesser (Chicago:
Health Administration Press, 2001), 3– 18; and J.B. Christianson and S.
Trude, “Managing Costs, Managing Benefits: Employer Decisions in Local
Health Care Markets,” Health Services Research 38, no. 1 (2003):
357–373.
5. K. Swartz, “The Death of Managed Care as We Know It,”
Journal of Health Politics, Policy and Law 24, no. 5 (1999): 1201–1205;
and J.C. Robinson, “The End of Managed Care,” Journal of the American
Medical Association 285, no. 20 (2001): 2622–2628.
6. B.C. Strunk and P.B. Ginsburg, “Tracking Health Care
Costs: Trends Stabilize but Remain High in 2002,” Health Affairs,
11 June 2003, content.healthaffairs.org/cgi/content/abstract/hlthaff.w3.266
(21 June 2004).
7. Regarding impact on cost trends, see T. Rice and K.R. Morrison,
“Patient Cost Sharing for Medical Services: A Review of the Literature
and Implications for Health Care Reform,” Medical Care Review 51,
no. 3 (1994): 235–287; and J.S. Lee and L. Tollen, “How Low Can You
Go? The Impact of Reduced Benefits and Increased Cost Sharing,” Health
Affairs, 19 June 2002,
content.healthaffairs.org/cgi/content/abstract/hlthaff.w2.229
(21 June 2004). Regarding financial barriers, see S. Trude, “Patient Cost
Sharing: How Much Is Too Much?” Issue Brief no. 72 (Washington: Center
for Studying Health System Change, December 2003). Regarding reduced take-up
of insurance, see L.J. Blumberg, L.M. Nichols, and J.S. Banthin, “Worker
Decisions to Purchase Health Insurance,” International Journal of Health
Care Finance and Economics 1, nos. 3–4 (2001): 305–325.
8. P. Kemper et al., “The Design of the Community Tracking
Study: A Longitudinal Study of Health System Change and Its Effects on People,”
Inquiry 33, no. 2 (1996): 195–206.
9. S. Felt-Lisk and G.P. Mays, “Back to the Drawing Board:
New Directions in Health Plans’ Care Management Strategies,” Health
Affairs 21, no. 5 (2002): 210–217; and G.P. Mays, R.E. Hurley, and
J.M. Grossman, “An Empty Toolbox? Changes in Health Plans’ Approaches
for Managing Costs and Care,” Health Services Research 38, no. 1
(2003): 375–394.
10. A.C. Short, G.P. Mays, and J. Mittler, “Disease Management:
A Leap of Faith to Lower-Cost, Higher-Quality Health Care,” Issue Brief
no. 69 (Washington: HSC, October 2003).
11. G.P. Mays, G. Claxton, and B.C. Strunk, “Tiered Provider
Networks: Patients Face Cost-Choice Trade-offs,” Issue Brief no. 71 (Washington:
HSC, November 2003).
12. R.E. Hurley et al., “A Longitudinal Perspective on
Health Plan–Provider Risk Contracting,” Health Affairs 21,
no. 4 (2002): 144–153.
13. Ibid.
14. Mays et al., “An Empty Toolbox?”
15. Short et al., “Disease Management.”
16. P.B. Ginsburg, “The Pricing Practices of Hospitals,”
Testimony before the Ways and Means Subcommittee on Oversight, U.S. House of
Representatives, 22 June 2004,
waysandmeans.house.gov/hearings.asp?formmode=view&id=1687
(23 June 2004).
17. A.M. Garber, “Can Technology Assessment Control Health
Spending?” Health Affairs 13, no. 3 (1994): 115–126.
18. J.P. Newhouse, Free for All: Lessons from the RAND Health
Insurance Experiment (Cambridge, Mass.: Harvard University Press; 1993);
and Trude, “Patient Cost Sharing.”
Glen Mays (gpmays{at}uams.edu) is an associate
professor in the Department of Health Policy and Management, College of Public
Health, University of Arkansas for Medical Sciences in Little Rock. Gary Claxton
is vice president of the Henry J. Kaiser Family Foundation in Washington, D.C.
Justin White is a research assistant at Mathematica Policy Research, also in
Washington.
DOI: 10.1377/hlthaff.W4.427
©2004 Project HOPE–The People-to-People Health Foundation, Inc.
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