Managed Care Digest Part I

Each year the Sanofi-sponsored Managed Care Digest gives readers a detailed look at HMO and PPO trends, along with other related data.  This year’s is no exception.   (Sanofi Digest)   The data is gathered by a survey of HMOs and PPOs and represents a healthy slice of the overall market.  In regard to HMOs, which are kind of the old-fashioned form of managed care, enrollment growth had dropped almost 25% from 2000 and 2009 to 75.3 million people but has recently rebounded, largely due to Medicaid growth, to 79.5 million in 2011.  The five biggest chain HMOs had 51.4 members or over 60% of the total.  There were 22.5 million Medicaid HMO enrollees and about 10 million Medicare ones.  Hospital days per 1000 members have increased for Medicare and Medicaid members.  Family and individual HMO premium rates increased about 4% in 2011, not taking benefit changes into account.

HMOs are using slightly less fee-for-service and capitation reimbursement methods than in past years, but are still far and away the most common reimbursement method.  HMO drug utilization rose very slightly and generics continue to gain share, now at over 62% of all HMO prescriptions.  For PPOs, member growth rose to 150 million in 2011.  PPOs are contracting with more physicians, both primary care and specialist.  In contrast to HMOs, PPOs experienced a sharp fall in hospital days per thousand members, probably because high-deductible plans are more likely to be PPOs.  Drug prescriptions per member were down very slightly, but average cost per prescription rose.  Helped by the implementation of health reform and the ongoing economic recovery, membership is very likely to grow rapidly in the next couple of years for both HMOs and PPOs.  Tomorrow, more on drugs and other issues.