Does investor ownership of nursing homes compromise the quality of care?

OBJECTIVES: Two thirds of nursing homes are investor owned. This study examined whether investor ownership affects quality. METHODS: We analyzed 1998 data from state inspections of 13,693 nursing facilities. We used a multivariate model and controlled for case mix, facility characteristics, and location. RESULTS: Investor-owned facilities averaged 5.89 deficiencies per home, 46.5% higher than nonprofit facilities and 43.0% higher than public facilities. In multivariate analysis, investor ownership predicted 0.679 additional deficiencies per home; chain ownership predicted an additional 0.633 deficiencies. Nurse staffing was lower at investor-owned nursing homes. CONCLUSIONS: Investor-owned nursing homes provide worse care and less nursing care than do not-for-profit or public homes.

Why single payer? Why now?

US health care costs are the highest in the world and are again rising. A reopening of debate on health care reform is imminent. More than 44 million Americans have no health insurance, an increase of 11 million people since 1989. Although women have been slightly more likely to have health insurance than men, recent declines in Medicaid enrollment resulting from welfare reform are eroding this slim advantage. Being uninsured is associated with compromised access to primary care and an increased risk of dying. At least 29 million Americans are underinsured; although they have some insurance, they would nonetheless be bankrupted by a major illness. A single-payer national health insurance system would cover all Americans in a non-profit, tax-funded system similar to Social Security. It would simplify health administration, saving at least $100 billion annually on paperwork and redirecting that money to patient care.

Trends in health insurance coverage, 1989-1997.

The authors analyze trends in health insurance coverage in the United States from 1989 through 1997, using cross-sectional surveys by the U.S. Census Bureau (Current Population Survey) of 160,000 persons representative of the non-institutionalized population. Between 1989 and 1997, the number of people without health insurance increased by 10.1 million to 43.4 million. From 1989 to 1993, the proportion covered by Medicaid increased by 3.6 percentage points while the proportion covered by private insurance declined by 4.2 percentage points. Since then, private coverage rates have stabilized and Medicaid coverage has decreased. Consequently, the number and percent uninsured continues to rise. Young adults age 18-39 had the largest increase in the proportion uninsured, and rates among children have also risen steeply since 1992. While blacks had the largest increase in the percent uninsured, Hispanics accounted for 35.6 percent of the increase in the number uninsured. Low-income families constituted over half of the increase in the number uninsured, but since 1993 the middle income group had the largest increase in the percent uninsured. Northeastern states had the largest increase in the percent uninsured. Thus, despite economic prosperity, the numbers and rates of the uninsured continue to rise. Principally affected are children and young adults, poor and middle-income families, blacks, and Hispanics.

Quality of care in investor-owned vs not-for-profit HMOs.

CONTEXT: The proportion of health maintenance organization (HMO) members enrolled in investor-owned plans has increased sharply, yet little is known about the quality of these plans compared with not-for-profit HMOs. OBJECTIVE: To compare quality-of-care measures for investor-owned and not-for-profit HMOs. DESIGN, SETTING, AND PARTICIPANTS: Analysis of the Health Plan Employer Data and Information Set (HEDIS) Version 3.0 from the National Committee for Quality Assurance's Quality Compass 1997, which included 1996 quality-of-care data for 329 HMO plans (248 investor-owned and 81 not-for-profit), representing 56% of the total HMO enrollment in the United States. MAIN OUTCOME MEASURES: Rates for 14 HEDIS quality-of-care indicators. RESULTS: Compared with not-for-profit HMOs, investor-owned plans had lower rates for all 14 quality-of-care indicators. Among patients discharged from the hospital after myocardial infarction, 59.2% of members in investor-owned HMOs vs 70.6% in not-for-profit plans received a beta-blocker (P<.001); 35.1% of patients with diabetes mellitus in investor-owned plans vs 47.9% in not-for-profit plans had annual eye examinations (P<.001). Investor-owned plans had lower rates than not-for-profit plans of immunization (63.9% vs 72.3%; P<.001), mammography (69.4% vs 75.1%; P<.001), Papanicolaou tests (69.2% vs 77.1%; P<.001), and psychiatric hospitalization (70.5% vs 77.1%; P<.001). Quality scores were highest for staff- and group-model HMOs. In multivariate analyses, investor ownership was consistently associated with lower quality after controlling for model type, geographic region, and the method each HMO used to collect data. CONCLUSIONS: Investor-owned HMOs deliver lower quality of care than not-for-profit plans.

Going bare: trends in health insurance coverage, 1989 through 1996.

OBJECTIVES: This study analyzed trends in health insurance coverage in the United States from 1989 through 1996. METHODS: Data from annual cross-sectional surveys by the US Census Bureau were analyzed. RESULTS: Between 1989 and 1996, the number of uninsured persons increased by 8.3 million (90% confidence interval [CI] = 7.7, 8.9 million). In 1996, 41.7 million (90% CI = 40.9, 42.5 million) lacked insurance. From 1989 to 1993, the proportion with Medicaid increased by 3.6 percentage points (90% CI = 3.1, 4.0), while the proportion with private insurance declined by 4.2 percentage points (90% CI = 3.7, 4.7). From 1993 to 1996 private coverage rates stabilized but did not reverse earlier declines. Consequently, the number uninsured continued to increase. The greatest increase in the population of uninsured [corrected] was among young adults aged 18 to 39 years; rates among children also rose steeply after 1992. While Blacks had the largest percentage increase, Hispanics accounted for 36.4% (90% CI = 32.3%, 40.5%) of the increase in the number uninsured. From 1989 to 1993, the majority of the increase was among poor families. Since then, middle-income families have incurred the largest increase. Northcentral and northeastern states had the largest increases in percent uninsured. CONCLUSIONS: Despite economic prosperity, the numbers and rates of the uninsured continued to rise. Principally affected were children and young adults, poor and middle income families, blacks, and Hispanics.

A reappraisal of private employers' role in providing health insurance.

BACKGROUND: In 1996, according to official figures, 61 percent of Americans received health insurance through employers. However, this estimate includes persons who relied primarily on government insurance such as Medicare, workers whose employers arranged their insurance but contributed nothing toward the premiums, and government employees whose private coverage was paid for by taxpayers. METHODS: To estimate the number of persons whose principal health insurance was paid for in whole or in part by employers in the private sector and the number receiving government-funded insurance, we analyzed data from the March 1997 Current Population Survey. Approximately 130,000 persons representative of the noninstitutionalized U.S. population were sampled. We considered people to be covered principally by health insurance paid for by private-sector employers if they had no public insurance coverage and were covered by insurance from a non-governmental employer who paid all or part of their premiums. Those who were covered by Medicaid, Medicare, insurance resulting from former or current military service, or the Indian Health Service were considered to be receiving government insurance. RESULTS: In 1996, 43.1 percent of the population (90 percent confidence interval, 42.7 to 43.5 percent) depended principally on health insurance paid for by private-sector employers, 34.2 percent (90 percent confidence interval, 33.8 to 34.6 percent) had publicly funded insurance, 7.1 percent (90 percent confidence interval, 6.8 to 7.6 percent) purchased their own coverage, and 15.6 percent (90 percent confidence interval, 15.3 to 15.9 percent) were uninsured. In only six states was more than half the population covered principally by health insurance paid for by private-sector employers. CONCLUSIONS: Current definitions of health insurance overemphasize the role of private employers and underestimate the extent to which government pays for health insurance.

Can Medicaid managed care provide continuity of care to new Medicaid enrollees? An analysis of tenure on Medicaid.

OBJECTIVES: The purpose of this study was to analyze duration of coverage among new Medicaid enrollees. METHODS: The 1991 Survey of Income and Program Participation was used to examined the duration of coverage for individuals who did not have Medicaid in January 1991 and obtained coverage by May 1993. RESULTS: Of new Medicaid enrollees, 38% (90% confidence interval [CI] = 34%, 42%) remained covered 1 year later; 26% (90% CI = 21%, 31%) remained covered at 28 months. Of those older than 65 years, 54% (90% CI = 31%, 77%) retained Medicaid for 28 months, vs 20% (90% CI = 14%, 26%) of children. Of people who lost Medicaid, 54% (90% CI = 31%, 77%) had no insurance the following month. CONCLUSIONS: Almost two thirds of new Medicaid recipients lose coverage within 12 months. It is unlikely that Medicaid managed care will enhance continuity of care for new recipients.

Costs of care and administration at for-profit and other hospitals in the United States.

BACKGROUND: In fiscal year 1990, administration accounted for 24.8 percent of total hospital costs in the United States - nearly twice the share in Canada. Studies from the 1970s and early 1980s found high costs, especially for administration, at for-profit hospitals. METHODS: We calculated administrative costs for 6227 nonfederal hospitals and the total costs of inpatient care for 5201 acute care hospitals in the United States for fiscal year 1994 on the basis of data the hospitals submitted to Medicare. We analyzed similar data for fiscal year 1990. Using multivariate analysis, we assessed the effect of hospital ownership (private not-for-profit, for-profit, and public) on administrative costs, controlling for hospital type, census region, hospital size, and the proportion of revenues derived from outpatient services. We adjusted inpatient costs for local wage levels, hospitals' reporting periods, and case mix. RESULTS: Administrative costs accounted for an average of 26.0 percent of total hospital costs in fiscal year 1994, up 1.2 percentage points from 1990. They increased by 2.2 percentage points, to 34.0 percent, for for-profit hospitals; by 1.2 percentage points, to 24.5 percent, for private not-for-profit hospitals; and by 0.6 percentage point, to 22.9 percent, for public hospitals. In 1994, administration accounted for 37.5 percent of total costs at psychiatric hospitals (44.4 percent at for-profit hospitals) and 33.0 percent of total costs at rehabilitation hospitals (37.7 percent at for-profit hospitals). In a multivariate analysis, for-profit ownership was associated with a 7.9 percent absolute (34 percent relative) increase in the proportion of hospital spending devoted to administration as compared with public hospitals and a 5.7 percent absolute (23 percent relative) increase as compared with private not-for-profit hospitals. Among acute care hospitals, for-profit institutions had higher adjusted costs per discharge ($8,115) than did private not-for-profit ($7,490) or public ($6,507) hospitals. Much of the difference was due to higher administrative costs ($2,289, $1,809, and $1,432 per discharge, respectively). CONCLUSIONS: Administrative costs as a percentage of total hospital costs increased in the United States between 1990 and 1994 and were particularly high at for-profit hospitals. Overall costs of care were also higher at for-profit hospitals.

US emergency department costs: no emergency.

BACKGROUND: Many perceive emergency department (ED) overuse as an important cause of high medical care costs in the United States. Managed care plans and politicians have seen constraints on ED use as an important element of cost control. METHODS: We measured ED-associated and other medical care costs, using the recently released 1987 National Medical Expenditure Survey of approximately 35,000 persons in 14,000 households representative of the US civilian, noninstitutionalized population. RESULTS: In 1987, total ED expenditures were $8.9 billion, or 1.9% of national health expenditures. People with health insurance represented 86% of the population and accounted for 88% of ED spending. The uninsured paid 47% of ED costs themselves; free care covered only 10%. For the uninsured, the cost of hospitalization initiated by ED visits totaled $3.3 billion, including $1.1 billion in free care. Whites accounted for 75% of total ED costs. The ED costs of poor and near-poor individuals accounted for only 0.47% of national health costs. CONCLUSIONS: ED use accounts for a small share of US medical care costs, and cost shifting to the insured to cover free ED care for the uninsured is modest. Constraining ED use cannot generate substantial cost savings but may penalize minorities and the poor, who receive much of their outpatient care in EDs.