title: The cost of acute outpatient primary care in a preferred provider organization.
abstract: This report is a case study analysis of the relative costs of preferred provider organization (PPO) and non-PPO managed episodes. Results indicate that the episode costs of PPO providers are not significantly different from the episode costs of non-PPO providers for general acute primary outpatient health care. PPO provider episode costs were 3.12% higher for acute upper respiratory illness. Higher PPO physician charges of 10-16% appear to be the main reason for relatively higher PPO episode costs. For general primary health care, drug charges are 23% higher in PPO episodes than in non-PPO episodes. Higher physician and drug charges are partially compensated for by diagnostic charges, which are 14-18% lower in PPO-managed episodes. In light of these findings and the cost-sharing arrangement with the PPO, it is likely that the employer/insurer plan paid expenditures for outpatient care will increase, contrary to expectations.
authors.affiliation: Department of International Health, Johns Hopkins School of Public Health, Johns Hopkins University, Baltimore, MD 21205.
authors.forename: A V
authors.initials: AV
authors.lastname: Wouters
mesh_terms: D000328:Adult; D002140:California; D002648:Child; D003365:Costs and Cost Analysis / Q000706:statistics & numerical data; D011307:Drug Prescriptions / Q000191:economics; D005192:Family Health; D005260:Female; D006801:Humans; D007357:Insurance, Physician Services / Q000191:economics; D008297:Male; D008329:Managed Care Programs / Q000191:economics*; D015233:Models, Statistical; D011243:Preferred Provider Organizations / Q000191:economics*; D011320:Primary Health Care / Q000191:economics*