Recorded presentation

W. David Bradford, PhD, Walter J. Jones, PhD, and David M. Ward, PhD. Department of Health Administration and Policy, Medical University of South Carolina, 171 Ashley Avenue, Charleston, SC 29425, 843-792-8464, jonesw@musc.edu

As states expand Medicaid managed care, there is concern about the impact of payment capitation and possible service rationing on Medicaid’s clients. Can states develop Medicaid programs that are both financially efficient and effective at providing access to care? The South Carolina Physician Enhanced Payment (PEP) program pays primary care physicians a capitated fee for managing each Medicaid recipient’s care. By providing a primary care “medical home”, PEP physicians try to ensure that needed medical care can be provided in a timely fashion, hopefully reducing the need for acute care, emergency department visits, and unnecessary inpatient hospital stays. In their research, the authors have examined service utilization for all PEP enrollees and matched samples of Medicaid FFS and conventional HMO enrollees (combined sample sizes of approximately 15,000). Service utilization was examined in five categories: primary care, specialty care, emergency department care, inpatient hospitalization, and filled prescriptions. Analysis suggests that unlike many HMO and other capitated programs, which disproportionately attract healthy clients, PEP tends to enroll Medicaid recipients who are somewhat less healthy, on average. However, once recipients enroll in PEP they do appear to change their service utilization toward more primary care and less specialty care. PEP therefore appears to both save money (compared to Medicaid FFS) and expand primary care utilization by underserved groups (compared to Medicaid HMOs). However, important research questions remain, including the possibility that programs like PEP reduce access to important specialty care services for chronically ill subpopulations, such as those with mental illnesses.

Learning Objectives: At the conclusion of this session, the participant will be able to

• Recognize the importance of a primary care "medical home" for underserved Medicaid clients.
• Describe the characteristics of Medicaid fee-for-service systems and HMOs that often limit access to care.
• Analyze the potential capabilities of Medicaid primary care physician capitation systems (such as PEP) to expand cost-effective access to care.

Keywords: Access to Health Care, Managed Care

Presenting author's disclosure statement:
I do not have any significant financial interest/arrangement or affiliation with any organization/institution whose products or services are being discussed in this session.

Recorded presentation