Effects of medicaid managed care on adults

Despite the rapid growth in Medicaid managed care (MMC) during the 1990s, only limited research exists on how such care affects beneficiaries.

The objective of this study was to assess how switching from a fee-for-service (FFS) delivery system to managed care affects Medicaid beneficiaries' access to, use of, quality of, and satisfaction with health care services.

Using a quasi-experimental design framework, we compared the experiences of 540 Minnesota Medicaid recipients living in counties that had switched to managed care with those of 528 recipients living in counties operating under FFS. The data for the analysis came from a 1998 survey of Minnesota Medicaid clients. Data were analyzed by logit regression.

We find limited effects of MMC on access to, use of, quality of, and satisfaction with health care. Among others, we found no significant differences between the share of managed care and FFS enrollees (78.5% versus 76%) who had a health care visit during the last year. We also found no evidence of a significant reduction in the proportion of managed care and FFS enrollees (17.6% versus 17%) who had had a hospital stay during the past year. The results did show some negative effects of MMC on satisfaction with care, the most consistent being that managed care enrollees are somewhat less satisfied with their health care than their FFS counterparts.

Our results suggest that a shift from FFS to MMC did not fundamentally change the patterns of health care service use, the location at which care was delivered, or quality.