Download Free Electronic Document

FormatFile SizeNotes
PDF file 0.1 MB

Use Adobe Acrobat Reader version 10 or higher for the best experience.

Research Brief

Trends in HMO Enrollment Pre- and Post-Backlash (in percentage)

  HMO Enrollment Change
1994 1998 2001 1994–1998 1998–2001
All insured 24 40 39 16 –1
Privately insured 31 48 45 17 –3
Medicare 10 18 18 8 <1
Medicaid 10 27 37 17 10
All insured (by region)
Northeast 26 48 45 22 –3
Midwest 22 32 31 10 –1
South 15 30 29 15 –1
West 37 53 57 16 4

NOTES: 1998–2001 is considered to be the post-backlash period. These results are population weighted. All numbers have been rounded.

Enrollment in HMOs (health maintenance organizations) exploded during the early 1990s, fueled by employers and public policymakers hoping to control rising health care costs. (HMOs typically enforce tight cost controls.) However, by the late 1990s, initial consumer support for managed care had eroded; consumers expressed fear that needed care might be withheld, and many favored tighter government regulation. A RAND Corporation study examined whether consumers "voted with their feet" by leaving their HMO plans.

The table shows trends in HMO enrollments during 1994–1998 versus the "post-backlash" period of 1998–2001.

  • Overall, for all insured consumers, there was only a 1 percent drop in HMO enrollment during the post-backlash period. There is evidence for two possible explanations:
    • Many consumers were more satisfied with their HMOs than had been thought.
    • Many HMOs relaxed their cost containment restrictions in order to avoid losing market share.
  • Privately insured patients were more likely than others to exit their HMOs.
  • Medicare HMO enrollment remained nearly steady; Medicaid enrollment increased significantly.
  • HMO enrollment grew even among the privately insured in areas with high health care cost increases.

This report is part of the RAND Corporation research brief series. RAND research briefs present policy-oriented summaries of individual published, peer-reviewed documents or of a body of published work.

Permission is given to duplicate this electronic document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND PDFs to a non-RAND Web site is prohibited. RAND PDFs are protected under copyright law. For information on reprint and linking permissions, please visit the RAND Permissions page.

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.