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Health Care Economics
Gatekeepers Aren’t Money Savers, RAND Study Concludes
Psychiatric News
Volume 37 Number 1 page 14-14

The value of gatekeepers, one of the criticized tools in the repertoire of managed care, has been challenged by a new study conducted under the auspices of the RAND Health Program in Santa Monica, Calif.

José J. Escarce, M.D., the lead study author, found that eliminating gatekeepers might not raise costs for health maintenance organizations (HMOs). Traditionally, HMOs have used gatekeepers to control access to medical specialists.

To determine the role of gatekeepers in cost reduction, Escarce and his colleagues compared two plan types offered by a managed care organization (MCO) in the Midwest: a traditional HMO and a point-of-service (POS) HMO. Point-of-service HMOs have open physician panels, which allow patients relatively free access to various health professionals.

Escarce said, "This is the first study to conduct a comprehensive analysis of spending in a POS compared with a more traditional HMO that uses primary care gatekeepers." The researchers examined spending in categories including physician services, inpatient and outpatient hospital services, and prescription drugs.

Costs were generally comparable between the gatekeeper HMO and the POS HMO.

The authors speculated that the reason for similar costs is that enrollees might need to make numerous visits to their primary care gatekeeper to get specialist referrals, which would increase the HMO expenditures and offset any savings that occur because of restricted access to care. Another possibility is that the cost of monitoring primary care physicians and maintaining authorization procedures in gatekeeper HMOs might also offset savings.

The researchers noted that as their survey was limited to one midwestern MCO, their findings might not apply to health care plans throughout the country. The trend toward decreased utilization of gatekeepers and other restrictive managed care strategies, however, has been documented in other studies.

The 2001 Annual Survey of Employer Health Benefits, conducted by the Henry J. Kaiser Family Foundation and the Health Research and Educational Trust, for example, found that enrollment was shifting from HMOs to less-restrictive forms of care like preferred provider organizations (PPOs) (Psychiatric News, October 19, 2001).

At "Emerging Health Care Market Trends," a December conference convened by the Center for Studying Health System Change (HSC), Glen Mays, a health researcher at Mathematica Policy Research, told the audience that the "managed care backlash [had] come into full bloom over the past couple of years, with consumers demanding more choice and fewer restrictions on their health care decision making."

May cited gatekeeping and utilization-management techniques as one of four tools that managed care plans have used to manage costs and care. Health care insurance companies, according to Mays, are relaxing restrictions for referrals to specialists in their existing plans and introducing new products without those restrictions. United Healthcare is coming out with a new direct-access HMO, which allows patients to self-refer to specialists and eliminates precertification requirements for hospitalization.

In his discussions with executives of health insurance companies, Mays found support for Escarce’s conclusion that gatekeepers might not be a source of savings. "Administrative costs associated with maintaining. . .utilization-management techniques had grown burdensome, and [companies] were not seeing the return in terms of cost savings," Mays told the audience.

Every two years HSC conducts on-site interviews with health care leaders in 12 nationally representative communities about emerging trends and presents the findings at a conference and in issue papers. Mays’s presentation was based on the most recent visits, which occurred 2000-01. An article about the conference will appear in the next issue of Psychiatric News.

A copy of the RAND study is available by calling the RAND Corporation at (310) 451-6913. The Web address of the Center for Studying Health System Change is www.hschange.org.

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