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Date of Award
Gail J. Summers
In response to climbing health care costs in the United States, many insurers and policy makers would like to eliminate waste in healthcare by steering spending toward the most cost-effective treatments. Obstacles to achieving this goal include identifying specific medical settings where overuse occurs, and then developing strategies to prevent overuse without harming patient welfare. My study examined childbirth, the number one reason for hospitalization in the US, where the overuse of medical resources primarily takes the form of nonmedically indicated cesarean deliveries.
The financial tools (physician payment differential and patient’s cost sharing) and other tools (utilization management, physician profiling, and practice guidelines) of managed care insurance create varied incentives that could affect behaviors of physicians and patients. Using data from the MarketScan commercial database, I proved that in a fee-for-service setting, physician’s financial incentives (physician payment differential) and patient’s financial disincentive (patient’s cost-sharing) affect treatment choices on childbirth delivery method, and other incentives from managed care insurance have little effect. My study also found that more restrictive nonfinancial tools in non-capitated HMOs which are expected to reduce the use of cesarean sections turn out to have little effect, while lower cost-sharing in non-capitated HMOs leads to more use of cesareans. It could provide two health policy implications: (1) health plans with generous benefits may need more restrictions and effective regulations aimed at cost control, and (2) raising patients cost-sharing may prove effective for managing medical expenses. Finally, a “What if” analysis sheds light on the likely effectiveness of various changes in managed care insurance design intended to reduce low-risk primary cesarean deliveries.
Yang, Jie, "Incentives Of Managed Care Insurance And Treatment Choices In Low-Risk Primary Cesarean Delivery" (2018). Wayne State University Dissertations. 2082.