Selection experiences in Medicare HMOs: Pre-enrollment expenditures

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Abstract

Using 1993 and 1994 data, the authors examine whether beneficiaries who enroll in a Medicare health maintenance organization (HMO), including those enrolling for only a short period of time, have lower expenditures than continuous fee-for-service (FFS) beneficiaries the year prior to enrollment. We also test whether biased selection varies by the level of HMO market penetration and the rate of market-share growth. We find favorable selection associated with enrollment into Medicare HMOs, which declines as market share increases but does not disappear. Among short-term enrollees, we find unfavorable selection, however, selection bias was not sensitive to market characteristics.

Original languageEnglish (US)
Pages (from-to)197-209
Number of pages13
JournalHealth Care Financing Review
Volume20
Issue number4
StatePublished - Oct 25 1999

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