Chernew M, Wodchis W, Scanlon D, McLaughlin C; Academy for Health Services Research and Health Policy. Meeting.

Abstr Acad Health Serv Res Health Policy Meet. 2002; 19: 4.

University of Michigan, 109 S. Observatory, Ann Arbor, MI 48109-2029; Tel: (949) 824-5247; Fax: (949) 824-8469; E-mail: mchernew@umich.edu

RESEARCH OBJECTIVE: In most markets, physicians affiliate with more than one health plan and thus HMO physician networks overlap. Because practice styles encouraged by one plan may spillover into the style of care provided to enrollees of other plans, this overlap may limit the ability and incentive for health plans to influence physician behavior, control utilization, or improve quality of care. At the same time overlap in physician networks affects the extent to which plans are viewed as substitutes and therefore affects price competition. Despite the potential importance of provider overlap in influencing plan performance, consumer choice, and competition, very little is known overall about the extent of overlap in different markets. The objective of this work is to document the extent and variation of overlap among physician networks in competing HMOs. STUDY DESIGN: We have collected the affiliated physician lists for most HMOs across the country, representing 82% of HMO enrollment. This dataset allows us to ascertain which plans contract with which physicians. We use this information to create several measures of overlap between competing health plans and summary measures of overlap at the market level. One measure of overlap is the ratio of the number of physicians on plan provider lists divided by the total number of physicians in the market. Other measures are based on pair-wise measures of overlap for plans in the same market. We compute the number of plan pairs with overlap falling in selected ranges (e.g., <10%, 10% - 30%, etc.) These pair-wise comparisons can be summarized at the market level. Because there tends to be more overlap in markets with more plans, in each case we compute unadjusted measures of overlap and measures adjusted for the number of plans in the market. Analysis is done overall and for primary care and specialist physician networks. Adjustments are made for non-reporting plans. POPULATION STUDIED: HMO health plans and their physician networks across the United States. PRINCIPAL FINDINGS: Preliminary findings suggest that the variation across MSAs in the ratio of physicians listed on plan provider lists to total physician is substantial. The mean across MSAs is 2.7. The standard deviation is 1.7. (Given the average number of plans in markets, this measure would be about 4 if there were complete overlap and 1 with no overlap). Separate analysis, using all possible pairs of plans within markets as the unit of observation, reveals that the average plan shares 56% of physicians with any given competitor. Nearly all MSAs (94%) have at least one plan that shares more than 50% of its physicians with at least one other plan. At the same time, 62% of all markets (MSAs) have at least one plan that shares fewer than 10% of its physicians with any other plan. Differences in primary care and specialist overlap appear to vary according to market characteristics such as the importance of university teaching centers. CONCLUSIONS: There is considerable overlap among health plans, but the degree of overlap varies at the plan and market level. IMPLICATIONS FOR POLICY, DELIVERY OR PRACTICE: Policies aimed at improving the quality of care or encouraging competition between plans must be cognizant of the overlap among provider networks. If plans have similar provider networks, they may not have the incentive to incur the costs necessary to improve quality. However overlapping provider networks may facilitate enrollee switching and therefore promote price competition. More research is needed to understand better how the overlap in markets affects competition and outcomes. Documenting the extent of overlap and its variation is a first step towards understanding its implications. PRIMARY FUNDING SOURCE: Foundations

Publication Types:

• Meeting Abstracts

Keywords:

• Choice Behavior
• Health Maintenance Organizations
• Health Planning
• Insurance, Health
• Physicians
• Research Design
• United States
• economics
• hsrmtgs

Other ID:

• GWHSR0002164

UI: 102273840

From Meeting Abstracts