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The American Journal of Managed Care January 2006
Value-based Insurance Design: A "Clinically Sensitive" Approach to Preserve Quality of Care and Contain Costs
A. Mark Fendrick, MD; and Michael E. Chernew, PhD
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Medicare HMO Penetration and Mortality Outcomes of Ischemic Stroke
John Bian, PhD; William H. Dow, PhD; and David B. Matchar, MD
Medicare and Medicaid Managed Care: A Tale of Two Trajectories
Robert E. Hurley, PhD; and Sheldon M. Retchin, MD
Do Drug Formulary Policies Reflect Evidence of Value?
Peter J. Neumann, ScD; Pei-Jung Lin, MS; Dan Greenberg, PhD; Marc L. Berger, MD; Steven M. Teutsch, MD; Edward Mansley, PhD; Milton C. Weinstein, PhD; and Allison B. Rosen, MD, ScD
Varying Pharmacy Benefits With Clinical Status: The Case of Cholesterol-lowering Therapy
Dana P. Goldman, PhD; Geoffrey F. Joyce, PhD; and Pinar Karaca-Mandic, PhD

Medicare HMO Penetration and Mortality Outcomes of Ischemic Stroke

John Bian, PhD; William H. Dow, PhD; and David B. Matchar, MD

Objective: To examine associations between Medicare health maintenance organization (HMO) penetration and stroke mortality outcomes among older persons.

Study Design: Panel analysis of nationally representative secondary data from 1993 to 1998.

Methods: The first analysis sample included ischemic stroke hospitalizations among older persons in the Nationwide Inpatient Sample; the second included county-level ischemic stroke deaths in the National Vital Statistics System. The 2 samples were merged with the HMO enrollment data and the 2001 Area Resource File. The 2 outcomes were inhospital death status and county-level population ischemic stroke death rates among older persons; the 2 utilization variables were length of hospital stay for ischemic stroke and proportion of ischemic stroke deaths occurring in hospitals. The 3 key explanatory variables were county-level Medicare total, independent practice association, and nonindependent practice association HMO penetration. Ordinary least squares analysis with hospital or county fixed effects was used in estimation.

Results: Medicare HMO penetration was not associated with the 2 ischemic stroke mortality outcomes (P > .05). Increases in Medicare total and independent practice association HMO penetration were associated with a significant shift in a higher proportion of stroke deaths from hospitals to nursing homes or residences (P < .05). Medicare HMO penetration was negatively associated with length of stay, although this was not statistically significant (P > .05).

Conclusions: Increased Medicare HMO penetration was associated with a shift in ischemic stroke deaths from hospitals to nonhospital settings. The effect of Medicare HMO penetration on quality of stroke care needs further research.

(Am J Manag Care. 2006;12:58-64)


Managed care organizations adopt various mechanisms (eg, utilization review, gatekeeping, and preauthorization) to control healthcare utilization.1 These mechanisms could lead to lower intensity of care, which has raised concerns about quality of care in managed care.2,3 One influential study4 suggested that older persons with chronic illnesses had worse outcomes in managed care than their fee-for-service (FFS) counterparts, but empirical evidence on performance of managed care is limited overall. One methodological challenge has been that managed care practice styles may spill over to FFS settings as managed care penetration increases. This practice style convergence may blur differences in outcomes between managed care and FFS practices when comparing outcomes at an individual level within areas.2,3,5 As a result, market-level studies6-8 of the effect of managed care penetration on marketlevel outcomes should be a useful complement to the individual-level comparisons. Although there have been studies9-15 of the effect of managed care market penetration on quality of care, few market-level studies12,15-17 have examined the effect of managed care penetration on outcomes.

This study examined the effect of Medicare health maintenance organization (HMO) penetration on mortality outcomes among older persons. We might hypothesize ex ante that this penetration could have different outcome effects on different diseases. In this article, we focus on ischemic stroke (hereafter referred to as stroke) because stroke is one of the leading causes of morbidity and mortality in the United States18 and because lower-intensity practice styles could be hypothesized to adversely affect stroke outcomes. Stroke requires intensive acute and postacute care that not only improves stroke survival but also prevents recurrent strokes, which have lower survival rates than initial strokes.19 Medicare requires a 3-day hospitalization before reimbursing for postacute care. Some Medicare HMOs, not subject to this 3-day rule, might bypass or shorten the initial hospitalization and reduce the intensity of postacute care. Although a previous market-level study20 showed that Medicare HMO penetration was not associated with stroke hospitalization rates, several studies21-23 found that, compared with FFS stroke patients, managed care stroke patients received a lower intensity of acute and postacute care. Therefore, we postulated that increased Medicare HMO penetration could lead to higher mortality rates for stroke. However, the level of intensity and the quality of care may depend on the type of HMO.14,24-26  One might expect that, in contrast to independent practice association (IPA) HMOs, transitions of care (eg, postacute care) may be better coordinated and less subject to the Medicare 3-day hospitalization rule in closed-network non-IPA (eg, staff or group) HMOs. We further postulated that the effects on stroke mortality may differ by Medicare IPA and non- IPA HMO penetration.

Using the Nationwide Inpatient Sample (NIS) and mortality data from the National Vital Statistics System from 1993 to 1998, we examined the associations between Medicare HMO penetration and inhospital and overall population mortality rates among older persons. Because of concern about the steady decreases in length of hospital stay (LOS) and the proportion of stroke deaths in hospitals during the past 2 decades in part due to the expansion of managed care,27 we further examined the associations between Medicare HMO penetration and LOS and the proportion of stroke deaths occurring in hospitals (vs nursing homes or residences).

METHODS

Data Sources

The main data sources were the NIS, mortality data from the National Vital Statistics System, and HMO enrollment files (Medicare-specific enrollment and HMO enrollment for all ages) from 1993 to 1998. This study period, although dated, represented a period during which diagnostics and therapeutics for stroke care were stable. An additional data source was the 2001 Area Resource File, from which we extracted county-level information on the number of neurologists per 1000 older (= 65 years) persons and on population counts of older persons by demographics (ie, age and sex) from 1993 to 1998.

The NIS, part of the Agency for Healthcare Research and Quality's Healthcare Cost and Utilization Project, includes discharges from a sample of hospitals representing approximately 20% of all community hospitals in the United States. Although the Healthcare Cost and Utilization Project tried to sample the same hospitals over time, some hospitals were added, replaced, or deleted each year mainly because new states participated in the project. Available information in the NIS included primary and secondary discharge diagnoses with the International Classification of Diseases, Ninth Revision (ICD-9-CM) codes, inhospital death status, LOS, patient demographics, and state or county codes.

The mortality data comprised all death certificates in counties with populations of at least 100 000 based on the 1990 census. Available mortality data included place of death, underlying cause of death (ICD-9-CM code), demographics, and state and county of residence. The place of death variable was coded as (1) death during a hospital inpatient, outpatient, or emergency department visit; (2) death in a nursing home or residence; or (3) death in another or an unknown place (about 2%). A single cause of death was reported.

Two HMO enrollment files were used to measure HMO penetration. The first file was the Medicare HMO enrollment file from the Centers for Medicare & Medicaid Services, which summarized the total number of Medicare HMO enrollees by contract (eg, risk contract) and type of HMO (ie, IPA, group, or staff) in each county, the adjusted average per capita cost rates, and the number of older persons eligible for Medicare Part A. The second file was the overall HMO enrollment file, which reported the number of HMO enrollees at the county level. A county was considered a Medicare HMO market. A partial justification for this market definition was that adjusted average per capita cost rates depended on counties as key administrative market areas.

We constructed 3 county-level Medicare HMO penetration measurements. Only risk contract HMO enrollment data were used to measure the penetration because risk HMOs were capitated and bore full financial risk. The first measurement was the Medicare total HMO penetration, measured as a ratio of the total number of Medicare HMO enrollees regardless of the type of HMO to the Medicare Part A-eligible population at the county level. The other 2 Medicare HMO penetration measurements were calculated in a manner similar to that used for the Medicare total HMO penetration, using IPA or non-IPA HMO enrollees instead of the total number of Medicare HMO enrollees. An additional HMO penetration variable measured overall (all ages combined) HMO penetration, constructed from HMO enrollment data from the Group Health Association of America and Interstudy (previously reported by Laurence Baker28). We calculated overall HMO penetration as a ratio of the total number of HMO enrollees to the total population in each county. (For a general discussion about measuring the county-level HMO penetration, see the 1997 article by Baker.28)

Analysis Samples

Using the NIS and mortality data, we created 2 analysis samples, which were merged with the 2 HMO penetration enrollment data files and the 2001 Area Resource File in the statistical analysis. The first sample (discharge level), constructed from the NIS, included stroke admissions with the primary diagnoses (ICD-9 code 434.xx or 436.xx), age at admission of 65 years or older, LOS of 180 days or less, and state and county codes. The key explanatory variables were the 3 Medicare HMO penetration measurements. Patient-level covariates included 2 dummy variables for age (65-74 as a reference, 75-84, and = 85 years), sex, and 6 selected comorbidities.29 Three county-level time-varying covariates were the overall HMO penetration, the number of neurologists per 1000 older persons, and the adjusted average per capita cost rates. The second sample (county level), constructed from the mortality data, included all stroke deaths among older persons.

Outcomes and Utilization Variables

We created 4 dependent variables in our analyses. The first 2 variables were inhospital mortality status (1 if an inhospital death vs 0 otherwise) and LOS in the discharge-level sample. The other 2 variables were the proportion of stroke deaths occurring in hospitals and the overall population stroke death rates among older persons in the county-level sample. For each of the 6 strata identified by the 3 age categories (65-74, 75-84, and = 85 years) and sex at each county in each year, we defined the proportion as a ratio of the number of stroke deaths occurring in the hospital setting (ie, death during a hospital inpatient, outpatient, or emergency department visit) to the total number of stroke deaths, excluding stroke deaths in the other category or in an unknown place. For each of the same 6 demographic strata, the stroke death rate was calculated as the total number of stroke deaths divided by the total population in each stratum.

Statistical Models

We ran 4 sets of models, 1 for each dependent variable. In each set of models, we estimated the effects of the 3 Medicare HMO penetration measurements separately. The main concern about estimating the effects of Medicare HMO penetration was that uncontrolled heterogeneity, particularly at the market level, could yield biased estimates.

With this concern in mind, we first regressed inhospital mortality status and LOS (log transformed) on Medicare HMO penetration, using the discharge-level sample. To minimize Medicare HMO selection biases, we used a hospital fixed-effects specification to control for any hospital and county-level time-invariant heterogeneity (eg, the "stroke belt" in the southeastern United States). Other covariates included patient-level demographics and 6 comorbidities, 3 county-level time-varying variables, and year dummy variables. To examine whether Medicare HMO penetration might have affected the place of stroke death and consequently negatively affected overall population stroke death rates, we then regressed the proportion of stroke deaths occurring in hospitals and overall population stroke death rates on Medicare HMO penetration with county fixed effects, weighted with county populations of older persons stratified by age categories (65-74, 75-84, and = 85 years) and sex. Except for the 6 comorbidities, the same covariates were used in the latter analysis.

 
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