Publications

Competition in the health insurance industry serves to protect consumers by providing access to affordable care. As Aetna looks to acquire Humana, and Anthem pursues Cigna, the proposed health insurance mergers have raised concerns over whether consolidation will reduce competition. A recent article in the New York Times highlights both sides of the debate.

During the past decade, increases in health insurance premiums have exceeded the rate of inflation, particularly in the individual and small group markets, with significant variation among states. The federal rate review regulation in the Affordable Care Act (ACA) requires health insurance carriers to file and publicly justify proposed rate increases of 10 percent or more. In a HCFO-funded study, Richard Scheffler, Brent Fulton, Ann Hollingshead, University of California, Berkeley; and Pinar Karaca-Mandic, University of Minnesota, conducted the first evaluation of state rate review authority in the individual market during the years immediately following the ACA’s enactment (2010–2013).

The Affordable Care Act (ACA) included financial and regulatory incentives and goals for states to bolster their health insurance rate review programs, increase their anticipated loss ratio requirements, expand Medicaid, and establish state-based exchanges. The researchers identified changes in states’ rate review programs and anticipated loss ratio requirements in the individual and small group markets since the ACA’s enactment, and linked these changes to the Centers for Medicare and Medicaid Services’ (CMS) criteria for an effective rate review program.

Medicare is the single largest purchaser of laboratory testing in the United States, yet test results associated with Medicare laboratory claims have historically not been available. In order to describe both the linkage of laboratory results data to Medicare claims and the completeness of these results data, the researchers obtained information about laboratory orders and results for all Medicare fee-for-service beneficiaries in 10 eastern states in 2011.

Control outcomes and exposures can improve internal validity of nonrandomized studies by assessing residual bias in effect estimates. The researchers reviewed examples of control outcomes and exposures from prior studies in Google Scholar and Medline.

The policy community generally has assumed that Medicare Advantage (MA) plans negotiate hospital payment rates similar to those for commercial insurance products and well above those in traditional Medicare. In a HCFO-funded study, Robert Berenson, M.D., Jonathan Sunshine, Ph.D., Emily Lawton, Urban Institute; and David Helms, Johns Hopkins Bloomberg School of Public Health, interviewed senior hospital and health plan executives to understand the negotiating dynamics between MA plans and hospitals, first to confirm that MA plans do pay hospitals at or near traditional Medicare payment rates and then to explain why.

With the goal of lowering health care costs, many policymakers and health care delivery systems are looking to change the way doctors are paid by focusing on quality of care. One innovative approach has been to shift incentives from a fee-for-service (FFS) payment model to a pay-for-performance (P4P) arrangement, under which doctors are rewarded for improving their quality of care. However, to date the financial incentives may not have triggered practices to change individual physician compensation policies. A recent Washington Post Wonkblog article reports findings from a study by former HCFO grantee Andrew Ryan, Ph.D., University of Michigan, on physician compensation in accountable care organizations (ACOs).

The policy community generally has assumed Medicare Advantage (MA) plans negotiate hospital payment rates similar to those for commercial insurance products and well above those in traditional Medicare. After surveying senior hospital and health plan executives, the researchers found, however, that MA plans nominally pay only 100–105 percent of traditional Medicare rates and, in real economic terms, possibly less.

States have varying degrees of review authority over health insurance carriers’ rates, including prior approval authority over proposed rates and requirements for loss ratios, the proportion of premium revenues spent on medical claims. The Affordable Care Act (ACA) requires carriers in certain categories of health insurance to provide public justification for rate increases of 10 percent or more. The researchers collected data on how states changed their rate review authority and requirements in the years immediately after enactment of the ACA.

Medical group practices are central to many of the proposals for health care reform, but little is known about the relationship between practice-level characteristics and the quality and cost of care. In this study, the researchers found that practice characteristics influence costs indirectly through a set of statistically significant relationships among screening and monitoring measures and avoidable utilization.