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Does managed care make a difference? Physicians' length of stay decisions under managed and non-managed care

DOI: 10.1186/1472-6963-4-3

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We studied lengths of stay for comparable patients who are insured under managed or non-managed care plans. Seven Diagnosis Related Groups were chosen, two medical (COPD and CHF), one surgical (hip replacement) and four obstetrical (hysterectomy with and without complications and Cesarean section with and without complications). The 1999, 2000 and 2001 – data from hospitals in New York State were used and analyzed with multilevel analysis.Average length of stay does not differ between managed and non-managed care patients. Less variation was found for managed care patients. In both groups, the variation was smaller for DRGs that are easy to standardize than for other DRGs.Type of insurance does not affect length of stay. An explanation might be that hospitals have a general policy concerning length of stay, independent of the type of insurance of the patient.There is concern that factors other than the medical needs of a patient influence decision-making by physicians [1,2]. Non-medical factors play a role in explaining medical practice variation [3-5]. Among the factors that influence medical treatment are uncertainty of the most effective practice, response to regulations, method of patients' payment to the physicians, and type of insurance coverage [4].In this study we examined the influence of type of insurance, and the influence of managed care in particular, on the decisions physicians take and on variation in medical practice. Managed care plans have evolved in the USA, where they are widely used to control costs by combining the financing and delivery of health care. Providers are at financial risk in capitated plans and the insured have less choice where treatment and health care providers are concerned. The potential of managed care is attractive to policy makers in Europe.Different types of insurance coverage are linked to different premiums and different ways in which providers of care are paid. As a consequence, the type of insurance cover that patients


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