Segmentation of Hospital Markets

Where Do HMO Enrollees Get Care?

Published in: Health Affairs, v. 16, no. 6, Nov./Dec. 1997, p. 181-192

Posted on RAND.org on December 31, 1996

by Jose J. Escarce, Judy A. Shea, Wei Chen

Read More

Access further information on this document at Health Affairs

This article was published outside of RAND. The full text of the article can be found at the link above.

Commercially insured and Medicare patients who are not in health maintenance organizations (HMOs) tend to use different hospitals than HMO patients use. This phenomenon, called market segmentation, raises important questions about how hospitals that treat many HMO patients differ from those that treat few HMO patients, especially with regard to quality of care. This study of patients undergoing coronary artery bypass graft surgery found no evidence that HMOs in southeast Florida systematically channel their patients to high-volume or low-mortality hospitals. These findings are consistent with other evidence that in many areas of the country, incentives for managed care plans to reduce costs may outweigh incentives to improve quality.

This report is part of the RAND Corporation external publication series. Many RAND studies are published in peer-reviewed scholarly journals, as chapters in commercial books, or as documents published by other organizations.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.