The consequences of paying Medicare managed care plans their costs.
This study examines 1993 Medicare expenditures for enrollees in 63 managed care plans that were reimbursed on a cost basis. We find that government spending for enrollees in cost-reimbursed plans in 1993 was substantially greater than it would have been had these enrollees instead received care in traditional fee-for-service Medicare or in a Medicare risk plan. The increase was due entirely to the much higher expenditures for Part B services under cost reimbursement. The findings suggest that Medicare cost reimbursement of health plans should be eliminated or significantly modified.
Mathematica Policy Research, Inc., Washington DC 20024, USA.
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D014487:Centers for Medicare and Medicaid Services, U.S.; D003362:Cost-Benefit Analysis; D017048:Health Care Costs; D005102:Health Expenditures / Q000706:statistics & numerical data*; D008329:Managed Care Programs / Q000191:economics*; D006278:Medicare / Q000191:economics*; D015233:Models, Statistical; D011050:Policy Making; D017061:Prepaid Health Plans / Q000191:economics; D012044:Regression Analysis; D012051:Reimbursement Mechanisms; D012308:Risk Management; D014481:United States