Some HMOs Resume Restrictions on Medical Services To Reduce Health Care Costs, Study Finds
HMOs are bringing back some "tried-and-true but highly unpopular methods" to control medical costs, according to a survey appearing Wednesday on the Health Affairs Web site, Reuters/Yahoo! News reports. The survey was based on 260 interviews with HMO and hospital executives, employers and regulators in 12 nationally-representative communities, including Boston; Cleveland, Ohio; Miami; Indianapolis; Seattle; and Syracuse, N.Y., between 2002 and 2003. In the early 1990s, HMOs had "some success in curbing medical cost growth" using unpopular methods, such as restricting members' choice of physicians and limiting hospital stays. However, a backlash among patients, doctors and hospitals led to an easing of the restrictions.
The study found that health care cost increases and a slow economy are causing HMOs to increase restrictions again, but HMOs are take a "more cautionary approach this time," Reuters/Yahoo! News reports. Instead of using so-called "doctor-as-gatekeeper methods," in which patients must get referrals from primary care physicians to consult specialists, HMOs are using tighter reviews on hospital length of stays and ending payment once a patient has reached certain thresholds of use, such as a third MRI.
Glen Mays, a health professor at the University of Arkansas and the study's lead author, said that HMOs are "trying to target high-cost services and those where they see a spike in use." According to the study's authors, it is unclear whether the changes are affecting costs. Systematic changes such as government cost controls are "more likely to contain costs over the long haul," Reuters/Yahoo! News reports. May said, "The solutions need to move beyond individual employer solutions to be more effective" (Dixon, Reuters/Yahoo! News, 8/11). An abstract of the study is available online. APM's "Marketplace Morning Report" on Thursday reported on the study. The segment includes comments from Mays (Palmer, "Marketplace Morning Report," APM, 8/12). The complete segment will be available online after the broadcast.