Lost in the August haze was an inconspicuous AHRQ-funded analysis that drew on Medical Panel Expenditure Survey, or "MEPS" data. MEPS, an ongoing AHRQ survey of U.S. households, is touted as the only data set that crosshatches detailed demographics with detailed health expenditure data. And so it's particularly sensitive to how health spending changes over time.
Much of what the August report had to say could have been predicted: older people spend more on health care; sicker people spend more on health care; obesity is a significant problem. But one conclusion seemed at least mildly jarring: "Managed care has a neutral effect on the concentration of health care expenses."
Indeed, the MEPS data showed that among the under-65 population with health insurance at the workplace there were "no statistically significant difference in concentration [of health expenses] between those enrolled in HMOs and other types of gatekeeper plans and those enrolled in indemnity" and other fee-fee-service plans. In other words, for individuals who spent the most on care, the kind of insurance they had didn't make any difference.
At one level, this may simply suggest that for the sickest Americans no insurance plan is likely to slow costs to any great extent -- the need for care is just too great. But I wonder if the MEPS data might also be saying at least a little something about the morphing of "managed care."
To wit: When Paul Ellwood first hit upon and named the HMO in 1969, that was managed care. But over the years, the classic closed-panel HMO has been overtaken by less tightly structured insurance arrangements with higher employee cost sharing -- notably, PPOs. A recent headline out of Minnesota, center of gravity for the model Ellwood pioneered, tells the story: "HMOs Steadily Losing Ground." Such is documented more broadly by recent HealthLeaders/Interstudy data that show that HMOs now represent south of 40 percent of managed care enrollments.
Thus, while managed care as a whole has greatly increased its insurance-market penetration -- approaching, in the commercial market, 90 percent -- its most pervasive flavor carries much less cost-control bite than the classic, tightly regimented HMO . . . not unlike how water gets shallower as it spreads across a flat surface. (Interestingly, the newest HealthLeaders/Interstudy data show HMO enrollments stabilizing, but given HMOs' severe market erosion over the last few years, it's probably too early to accord this finding lasting significance.)
In all, the MEPS report's finding that high levels of expense are impervious to insurance may become a little more understandable in the context of managed care's evolution. And so if you're like me, and you spent August soaking up summer's dwindling bliss rather than bearing down on data sets, now may be a good time to give the AHRQ analysis a look.
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