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4 p.m. (EDT), Tuesday, April 18, 2000

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Lars C. Erickson, M.D., M.P.H., from Children's Hospital Boston, and colleagues, conducted a study of 58,902 patients hospitalized for CABG surgery from 1993 to 1996 using New York Department of Health databases to determine the use of lower-mortality hospitals by patients with different types of health insurance. Cardiac surgical centers in New York, of which 14 were classified as lower-mortality hospitals (average mortality rate, 2.1 percent) and 17 were classified as higher-mortality hospitals (average mortality rate, 3.2 percent), were studied./

"Patients with managed care insurance and, particularly, managed Medicare insurance were often excluded from many lower-mortality hospitals entirely, implicating relatively powerful disincentives, such as use restrictions set by insurance companies, rather than differences in patient or referring physician preferences," the authors write. "Such restrictions could include removing a hospital from a plan's preferred provider list or requiring a significant patient co-payment for the use of that hospital."

Compared with patients with private fee-for-service insurance, patients with private managed care insurance were 23 percent less likely to receive CABG surgery at a lower-mortality hospital; Medicare managed care insurance patients were 39 percent less likely.

If the managed care plans had guided patients to low-mortality centers or had considered mortality in selective contracting, the expected outcome is that managed care patients would be concentrated in low-mortality centers, according to an editorialist who wrote about this study. Instead, there was a statistically significant tendency for managed care plans to use centers with higher mortality rates, even after researchers adjusted the results for factors that may have confounded the results.

"Financial risk provides a strong incentive for health plans to select low-priced hospitals. However, health plans should also consider quality of care when contracting with hospitals, especially if explicit data on quality are available," the authors write.

The researchers explain these research findings are opposite previous California research findings, where managed care patients were more likely than insured non-managed care patients to use hospitals with lower-than expected mortality rates for coronary bypass graft surgery. They cite a commentary written on this study which explains that California has no certificate-of-need system (some states require hospitals to obtain state approval before initiating a new medical service, and the approval is often based partially on the amount of volume that hospital will see when providing the service to avoid costly duplication of services in a particular region).

They explain that California has numerous low-volume hospitals with high mortality rates performing CABG surgery. They say because low volumes make contracting unattractive, managed care plans in California avoid sending their patients to the highest mortality hospitals. The authors Erickson et. al. explain that New York has a certificate-of-need program, which dictates that all CABG surgery hospitals have high surgical volumes.

In conclusion, the authors write: "... by limiting patient choices, managed care organizations may prevent patients and their advocates from taking full advantage of available information about hospital quality. This could inadvertently stifle incentives for hospitals to compete on the quality of care. Additional studies on the impact of quality information on health plans' contracting decisions will be important as price competition among health plans becomes more intense."

Children's Hospital, Boston, is the nation's premier pediatric medical center. Founded in 1869 as a 20-bed hospital for children, today it is a 300-bed comprehensive center for pediatric and adolescent health care grounded in the values of excellence in patient care and sensitivity to the complex needs and diversity of children and families. Children's Hospital is the primary pediatric teaching hospital for Harvard Medical School, home to the world's leading pediatric research enterprise, and the largest provider of health care to the children of Massachusetts.

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