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Determinants of managed care penetration
D Dranove1, C J Simon, W D White
1Kellogg Graduate School of Management, Northwestern University Evanston, IL, USA.
Journal of Health Economics
|May 29, 1999
Summary
Managed care penetration varies by geographic area due to factors like demographics and hospital market concentration. Physician practice organization also influences managed care adoption rates.
Area of Science:
- Health Services Research
- Healthcare Economics
- Medical Geography
Background:
- Managed care penetration varies significantly across different geographic regions.
- Understanding the drivers of this variation is crucial for healthcare policy and planning.
Purpose of the Study:
- To identify and analyze the key factors associated with disparities in managed care penetration across geographic areas.
- To compare the effectiveness of two distinct measures for assessing managed care penetration.
Main Methods:
- Utilized two measures: physician revenue from managed care contracts and market survey data on managed care plan enrollments.
- Employed regression analysis to examine the relationship between managed care penetration and various geographic, demographic, labor market, and hospital supply-side variables.
Main Results:
- Demographic characteristics significantly influence managed care penetration.
- Labor market conditions and hospital market concentration are key determinants.
- Physician practice organization patterns and hospital occupancy rates also play a crucial role.
Conclusions:
- Managed care penetration is a complex phenomenon influenced by a combination of demand-side (demographics) and supply-side (hospital market structure, physician organization) factors.
- Both physician revenue and enrollment data provide reliable insights into managed care penetration.
- Findings have implications for understanding regional healthcare market dynamics and policy interventions.