MANAGED CARE, MARKET REPORTS AND THE STATES

material added 7/1//2017

Table of Contents

ARCHIVE FEATURES - This web report was compiled and maintained between 2008 and 2013.  Other than individual state market reports for 2015-17, It no longer contains updates or current information.  Use as an historical reference only, pending a future edition.  For current health insurance material, see http://www.ncsl.org/default.aspx?tabid=21388

Overview

Managed care is a term used to describe a variety of techniques intended to reduce the cost of providing health benefits and improve the quality of care for organizations that use those techniques or provide them as services to other organizations. It is also used to describe systems of financing and delivering health care to enrollees organized around managed care techniques and concepts.

Over the past 20 years, managed care has become the predominant form of health care in most parts of the United States.  More than 70 million Americans have been enrolled in HMOs (health maintenance organizations) and almost 90 million have been part of PPOs (preferred provider organizations). Overall enrollment numbers in HMOs peaked in 2001 and are declining substantially in almost every area, but managed care generally remains a dominant type of health care and coverage.  

According to Kaiser Family Foundation's Employer Health Benefits 2010 Annual Survey, 58 percent of covered workers are enrolled in PPOs, followed by HMOs (19 percent), HDHP/SOs (13 percent), POS plans (8 percent), and conventional indemnity plans (1 percent).  Enrollment in HDHP/SOs rose to 13 percent of covered workers in 2010, up from 8 percent  in 2009.

  • Plan enrollment patterns vary by firm size. Workers in large firms (200 or more workers) are more likely than workers in small firms (3-199 workers) to enroll in PPOs (63 percent vs. 51 percent). Workers in small firms are more likely than workers in large firms to enroll in POS plans (15 percent vs. 5 percent.
     
  • Managed Care Digest Series - The HMO-PPORx Digest provides comprehensive overviews of the medical and pharmacy benefits—along with extensive retail pharmacy data by chronic disease category—at managed care plans, including HMOs, PPOs and point-of-service plans. This Digest features long-term trends and analyses of key industry measures, as well as information pertaining to the impact of health care reform legislation. Updated 2017

 


Managed Care in Medicaid

Medicaid managed care grew rapidly in the 1990s.  In 1991, 2.7 million beneficiaries were enrolled in some form of managed care.  By 2004, that number had grown to 27 million, an increase of 900 percent.  Of the total Medicaid enrollment in the United States in 2009, almost 72 percent were receiving Medicaid benefits through managed care.  All states except Alaska and Wyoming have all, or a portion of their Medicaid population enrolled in an MCO (Managed Care Organization).  States can make managed care enrollment voluntary, or seek a waiver of section 1915(b) of the Social Security Act from the Centers for Medicare and Medicaid Services to require certain populations to enroll in an MCO.

Medicaid Managed Care State Contracts- The George Washington University's Department of Health Policy published a series of unique studies of managed care contracts.  State-by-state profiles are included on their webpage. These state profiles show the various components of each state's contract with health plans, including performance standards, reporting requirements, definition of actuarially sound rates, conditions under which money must be returned, etc.  Contact GWU for access to this material at http://www.gwumc.edu/sphhs.

"Medicare Advantage" managed care plans saw a surge in enrollment as a result of the launch of "Part D" prescription drug coverage in 2006.    

The State Legislative Role-  Over the years, state legislatures have responded by passing numerous laws on the subject of managed care - over 900 in the past 15 years, in all 50 states. NCSL has a variety of print and web-based resources describing these efforts - see below.

In 2001-2002, the U.S. House of Representatives passed an amended Patients' Rights bill; the U.S. Senate passed a somewhat different bill. However, at the end of the congressional session the bills died in a House-Senate conference committee, primarily on issues related to liability and the right to sue. Similar federal measures were filed for 2003-06, but were not voted on.



Managed Care Resources

These are selected research, academic and advocacy publications.  NCSL is not responsible for the contents or opinions expressed within these pages.

  • Arizona Health Care Market Report 2008- "Following the Money,"1/09.  Full report, 58 pages. [link updated 2016]

  • California Health Care Market Report 2006- Summary released by Allan Baumgarten, 3/07. [link updated 2017]

  • Colorado Health Market Review 2017 - "For the tenth straight year, Denver-area health systems posted higher pre-tax profits. Colorado health plans regained profitability and continued to add new members."  updated 11/15/2017]

  • Florida Health Market Review 2015- Summary released by Allan Baumgarten, 2015.

  • Illinois Health Market Review 2016 finds: Health Plan Enrollment Surges, But Profits Decline. Hospital Systems Pursue Growth Strategies, But Profits Decline by 42%. Summary released by Allan Baumgarten, 8/2016.

  • Kentucky Health Care Market Report 2007- Foundation for a Healthy Kentucky, research by Allan Baumgarten, 2/08. [76 pages, PDF]

  • Michigan Health Market Review 2017 Finds: "Medicaid plans add members but profits drop sharply; HMOs and insurers post large losses on individual plans"Medicaid Expansion Adds 183,000 HMO Members in 2015 and 2016, Increases HMO Profits-  Summary released by Allan Baumgarten, 7/2017.

  • Minnesota Health Market Review 2017, Part One, released May 25: "Part One, released June 9: "Minnesota Health Plans Go From Record Profits to Large Losses; Health Systems Push Ahead With Health Plan Strategies"(6/2017) HMO Profits for Public Programs Surpass $230 Million; Medicaid Enrollment Grows But Individual Market Remains Volatile; Hospitals Double Down on Health Plan Strategy" - Summary released by Allan Baumgarten, 5/2016.

  • New York: The Big Picture: Private and Public Health Insurance Markets- by Peter Newell and Allan Baumgarten. Funded by United Hospital Fund of New York. 10/22/09. [150 pages ] 2010 Update

  • Ohio Managed Care Review 2016 Summary released by Allan Baumgarten, 2016.

  • Texas Health Market Review - Summary released by Allan Baumgarten, 2016

  • Wisconsin Health Market Review 2014 - Hospitals Report Record Profits. Summary released by Allan Baumgarten, 2014. [link updated 2017]

   

STATE HEALTH MARKET REPORTS & MATERIAL (written and released by Allan Baumgarten):

Full reports are available for purchase from http://www.AllanBaumgarten.com.

 ADDITIONAL ARCHIVE REPORTS AND LINKS

NCSL staff contact: Richard Cauchi - Health Program, Denver.