[MOL] Part 4-HMO SERIES.... [00700] Medicine On Line

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[MOL] Part 4-HMO SERIES....

      An oncologist and an HMO executive are at the gates of heaven, waiting for their deeds on Earth to be judged. The cancer specialist, lauded for all the lives he has saved, is escorted through the pearly gates. As the managed care executive steps forward, St. Peter tells him he can go too, "but you can only stay three days."
      It's not easy running a health plan these days. You're the butt of jokes, the latest bad guy who's tying damsels in distress to railroad trestles. But it's a little too simplistic to paint the entire industry as evil incarnate. Like any other business, there are good plans and not-so-good plans; the trick is knowing which one is which.
      Some consumer advocates will tell you that one way to find the better plans is to look for one that's not-for-profit. The fact that so many health plans making life-and-death decisions answer to investors on Wall Street makes some people nervous, so they argue it's safer to go with one that is independent of the investment world.
      "Just logically, a not-for-profit plan is not responding to the pressures of investors," says Larry Levitt, a researcher at the Kaiser Family Foundation.
      But hard evidence for this rule of thumb is more difficult to come by, since no one has done an exhaustive survey of the real-life differences between for-profit and not-for-profit HMOs.
      That may change as HMOs around the country report publicly on their performance in the so-called HEDIS survey. An analysis of the latest survey, which includes about half the health plans in the nation, has shown that not-for-profits tend to have happier members and spend more on them than do for-profits. On the other hand, the not-for-profits also tend to have poorer financial performance.
      But if you dig deeper, there's another reason why these plans might please their members more: They tend to have a staff of doctors who care for their patients, rather than a network of independent providers.
      These “staff model” HMOs are disappearing almost as fast as full-service gas stations. But the staff model was how the original health plans, most of them not-for-profit, got started many decades ago. It was a way to keep track of their patients' health and ensure that all the doctors in the plan were carrying out quality care.
      There are still some staff model HMOs around — the most notable examples are Kaiser Permanente, in California, and Group Health Cooperative, in the Northwest.
      But even they have bent to the marketplace and begun to put more distance between themselves and the doctors. That change has come about because many consumers prefer more choice. They don't like going to a single "primary care" doctor who decides whether they get to see a specialist, or they see the plan as being too paternal or bureaucratic.
      On the other hand, Group Health boasts a large number of longtime members who appreciate having a long-term relationship with one doctor and one plan. In fact, studies show that the longer someone is in a health plan, the happier they are with it.
      Another way to judge the supposed difference between for-profit and tax-exempt plans is by the percentage of money they spend on medical care instead of administration. This is called the "medical loss ratio," and is often a piece of information you can obtain from your health plan or state insurance department. In the most recent analysis of national HMO data, not-for-profits reported spending 91.5 percent of their money on medical care, while for-profits reported spending 87.2 percent.
      Critics of the medical loss ratio argue that differences in the way plans define what is an "administrative" cost make the number unreliable. In any event, the gap may be narrowing anyway as all HMOs — much to their dismay — spend more on doctors and hospitals and get slimmer returns. In fact, the spending trend could have a nasty flip side: If HMOs can't make it financially, they'll go belly-up, leaving consumers in the lurch.
      When picking a health plan, be aware of these issues of organization and profitability, but don’t rely on them solely. For instance, if all your friends go to an excellent local HMO that happens to be for-profit, don't forgo it. Pay attention to all the information available about your local plans, including how well they provide preventive care and whether your favorite doctor or hospital participates.

Warmly, lillian
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