Are All Managed Care Plans Created Equal? Evidence from Random Plan Assignment in Medicaid /
Geruso, Michael.
Are All Managed Care Plans Created Equal? Evidence from Random Plan Assignment in Medicaid / Michael Geruso, Timothy J. Layton, Jacob Wallace. - Cambridge, Mass. National Bureau of Economic Research 2020. - 1 online resource: illustrations (black and white); - NBER working paper series no. w27762 . - Working Paper Series (National Bureau of Economic Research) no. w27762. .
August 2020.
Exploiting random assignment of Medicaid beneficiaries to managed care plans, we identify plan-specific effects on healthcare utilization. Auto-assignment to the lowest-spending plan generates 30% lower spending than if the same enrollee were assigned to the highest-spending plan, despite identical cost-sharing. Effects via quantities, rather than differences in negotiated prices, explain these patterns. Rather than reducing "wasteful" spending, low-spending plans cause broad reductions in the use of medical services--including low-cost, high-value care--and worsen beneficiary satisfaction and health. Supply side tools circumvent the classic trade-off between financial risk protection and moral hazard, but give rise instead to a cost/quality trade-off.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Are All Managed Care Plans Created Equal? Evidence from Random Plan Assignment in Medicaid / Michael Geruso, Timothy J. Layton, Jacob Wallace. - Cambridge, Mass. National Bureau of Economic Research 2020. - 1 online resource: illustrations (black and white); - NBER working paper series no. w27762 . - Working Paper Series (National Bureau of Economic Research) no. w27762. .
August 2020.
Exploiting random assignment of Medicaid beneficiaries to managed care plans, we identify plan-specific effects on healthcare utilization. Auto-assignment to the lowest-spending plan generates 30% lower spending than if the same enrollee were assigned to the highest-spending plan, despite identical cost-sharing. Effects via quantities, rather than differences in negotiated prices, explain these patterns. Rather than reducing "wasteful" spending, low-spending plans cause broad reductions in the use of medical services--including low-cost, high-value care--and worsen beneficiary satisfaction and health. Supply side tools circumvent the classic trade-off between financial risk protection and moral hazard, but give rise instead to a cost/quality trade-off.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.