Utilization of Services of an HMO by New Enrollees RON N. FORTHOFER, PHD, AND JAY H. GLASSER, PHD
Abstract: This study investigates whether there is a built-up demand for health services that surfaces when people enroll through a group plan in a Health
Maintenance Organization. The study population consists of newly enrolled subscriber units of the Kaiser Foundation Health Plan (Oregon Region). The utilization variables examined include the number of inpatient and outpatient contacts with the Plan, the number and type of specific services performed, and the type of outpatient contact. The enrollees were followed over 12 quarters (three years). The analysis showed that the first quarter stood out in three respects: its average number of inpatient and outpatient contacts were the lowest of
Health Maintenance Organizations (HMOs) are regarded as one means of dealing with the "medical care crisis" in the United States. Although one type of HMO, the prepaid group practice, has been around for 50 years,' there remain a number of unanswered questions about HMOs. One question of importance revolves around the idea that people who join an HMO do so because they have a built-up demand for health services. This question has been addressed to a degree in some previous studies. Densen, et al,2 mention a study which examined the total number of physician services provided to individuals who were continuously enrolled in the Health Insurance Plan of Greater New York (HIP) for its first four years of existence. The number of physician services were grouped by year for a three-year period. There appeared to be a degree of consistency among utilization levels from year to year although it appears as if regression to the mean was also operating. Densen, et al, followed up on this study by examining three years of data for a randomly selected sample of HIP enrollees who worked for the City of New York. Their results supported the earlier finding of a degree of consistency in utilization patterns. Sparer and Anderson3 provide data on the experience of low-income families who were enrolled in one of four prepaid group practice plans. A part of their study examined physician encounter rates by three-month intervals for the Address reprint requests to Ron N. Forthofer, PhD, Associate Professor of Biometry, Health Science Center at Houston, University of Texas, School of Public Health, P.O. Box 20186, Houston, TX 77025. Dr. Glasser is Associate Professor of Biometry at the University. This paper, submitted to the Journal April 13, 1978, was revised and accepted for publication May 21, 1979.
AJPH November 1979, Vol. 69, No. 11
any quarter; the mean numbers of radiology services and laboratory tests per outpatient contact were the highest during this quarter; and the highest proportion of regularly scheduled contacts and the lowest rate of patient cancellation of visits occurred during the first quarter. Hence, these data are not supportive of the idea of a built-up demand. Rather they suggest that the enrollee requires some time to learn how to deal with the system; and, once a new member contacts the system, the system may perform a number of tests to obtain baseline data about the enrolee. Additional analysis did not suggest the presence of any time trends in the utilization data. (Am J Public Health 69:1127-
1131, 1979.) families' first 18 months of participation in the plans. Results were mixed, although the general trend suggested that the first quarter rates were the highest. Another study by Yesalis and Bonnet4 reported on the Columbia Plan and its membership's ambulatory experiences. They concluded that the rate of provider visits/member/year appeared to peak during the first two quarters and then declined with the rate stabilizing during the second year. The study reported here continues the investigation of the experience of newly enrolled families in a prepaid group plan. Both inpatient and outpatient data are used in the examination of two questions: * Is there evidence of a built-up demand as measured by utilization during the initial quarter of enrollment compared to the second quarter? * Are there any discernible trends in utilization over 12 quarters of observation? In this study, utilization has been partitioned into three components: 1) number of contacts; 2) number of services provided per contact; and 3) type of outpatient appointment behavior. These questions about utilization were assessed with reference to subscriber age, sex, family size, enrollment date, and whether a birth or death occurred in the family during the period under study.
Materials and Method The study population is a sample of new enrollees in the Kaiser Foundation Health Plan (Oregon Region) who were followed over a three-year period. The Kaiser Health Services Research Center maintains an extensive computerized 1127
FORTHOFER AND GLASSER
utilization records system. Since September 1966, Kaiser has collected both inpatient and outpatient data on a randomly selected five per cent sample of subscriber units. This sample is updated monthly to keep the sample representative of the growth of the Health Plan population. The basic data used in this report are the utilization experience generated by the 1,587 units (4,575 people) who joined the sample after 1966 and before 1971, and who were members of the Plan for at least six months. More detail about the demographic characteristics of the Portland population, the Kaiser enrolled population, and the Kaiser five per cent sample is provided by Greenlick et al.5 The persons studied have enrolled mostly as members of a group, although there is some limited enrollment by individuals. The central focus of the analysis is the utilization experience of a subscriber unit i.e., the nuclear family unit, it being assumed that parents determine the utilization of their children. Each subscriber unit was followed over time. The exact number of person-months of membership is used in the analysis, and the utilization experience of each family is related to the person-months of exposure in calculating the appropriate rates. Each subscriber unit's experience was grouped into three-month intervals beginning with the initial date of enrollment and ending at the time of leaving the Plan or the end of the study reference period. If the last interval was less than three months, it was consolidated with the previous interval, and the utilization adjusted to a three-month reference period. The primary emphasis in the analysis was placed on the first two three-month intervals to examine the question of built-up demand, and secondly on the entire time period to examine the possibility of time trends. As detailed in Table 1 three types of utilization variables were considered. * Volume: the number of inpatient and outpatient contacts;
* Intensity: the number of inpatient days and the number of and types of services performed (both inpatient and
outpatient); * Learning: the manner of contact with the Plan as categorized by seven descriptors including place or type of visit and rate of patient cancellation. Analysis of these three types of variables and their components was performed for the entire sample of family units and for the entire sample categorized by the subscriber's age, subscriber's sex, unit (family) size, initial enrollment data for the unit, and occurrence of a birth or death in a unit. Paired t-tests were used to compare the subscriber unit's utilization during the first quarter with its second quarter utilization. To examine whether time trends existed over the three years, ranks were assigned to each quarter based on that quarter's position among all 12 quarters for each variable. No tests were performed in the examination of trends because the data violated one or more of the assumptions of the standard procedures used in hypothesis testing.
Results Table 2 provides the data that are used in the subsequent examination of the specific questions concerning utilization. It is difficult to readily discern patterns that exist across variables or trends over time when examining Table 2. Careful investigation suggests the existence of some patterns and these will be pointed out in the following analyses. The number of subscriber units on which each quarter's data are based is also given in Table 2. The decrease in this number does not indicate that families drop out of the Plan after a short time. Rather this variable reflects that many of the families enrolled sometime into the 1967-70 period, and hence were eligible for a short time before the end of the four-year period of observation.
TABLE 1-Study Variables and their Construction Variable
Volume Outpatient Contacts Inpatient Contacts Intensity Outpatient Procedures Laboratory Tests Radiology Services Average Inpatient Stay Inpatient Surgical Procedures EKG's Learning Preventive Services Regularly Scheduled Walk-In Emergency Telephone or Letter Other Patient Cancels
Construction
Outpatient Contacts/Person Year Inpatient Contacts/i 000 Person Years Outpatient Procedures/Outpatient Contacts Laboratory Tests/(Outpatient + Inpatient Contacts) Radiology Services/(Outpatient + Inpatient Contacts) Inpatient Days/Inpatient Contacts Inpatient Surgical Procedures/Inpatient Contacts EKG's/Inpatient Contacts Preventive Contacts/Outpatient Contacts Regularly Scheduled/Total* Walk-In/Total Emergency/Total Telephone or Letter/Total Other/Total Patient Cancels/Total
*Total = Regularly Scheduled + Walk-In + Emergency + Telephone or Letter + Other + Patient Cancellations.
1128
AJPH November 1979, Vol. 69, No. 11
SERVICES UTILIZATION BY HMO ENROLLEES TABLE 2-Means and Standard Errors for Indicated Variables for the New Enrollees in the Kaiser Portland 5% Sample from 1967-1970 by Three-Month Periods (Mean over Standard Error) Three-Month Periods
1
2
3
4
5
6
7
8
9
10
11
12
1587 3.00 .12 60 11 1.45 .01 1.22 .04 .24 .01 4.49 .07 .61 .02 .15 .02 .04 .44 .25 .08 .14 .05 .04
1587 3.68 .14 120 16 1.39 .01 1.06 .04 .21 .01 4.32 .08 .82 .02 .13 .01 .04 .42 .22 .07 .16 .06 .07
1359 3.48 .13 108 16 1.41 .01 .97 .05 .18 .01 5.67 .24 .69 .02 .24 .02 .04 .40
1201 3.68 .15 96 16 1.39 .01 .86 .04 .19 .01 5.11 .18 .76 .02 .26 .02 .06 .40 .20 .08 .18 .07 .07
1027 3.72 .19 144 23 1.38 .01 .90 .04 .19 .01 4.35 .10 .76 .02 .29 .04 .04 .39 .21 .07 .19 .06 .08
890 4.12 .24 108 19 1.38 .01 .88 .04 .18 .01 4.73 .16 .74 .02 .20 .02 .06 .42 .20 .08 .17 .06 .08
738 4.19 .24 132 27 1.40 .02 .87 .05 .20 .01 3.84 .09 .77 .03 .25 .03 .05 .41 .19 .07 .18 .07 .08
648 4.25 .29 156 27 1.46 .02 .92 .06 .21 .02 4.40 .13 .74 .03 .14 .01 .05 .40 .19 .05 .19 .07 .08
545 3.90 .26 84 23 1.43 .02 .91 .06 .20 .02 4.70 .13 1.06 .04 .30 .03 .05 .41 .20 .06 .21 .07 .06
448 4.01 .27 96 22 1.43 .02 .86 .06 .17 .02 3.70 .07 .71 .03 .20 .03 .05 .38 .23 .06 .18 .07 .08
375 3.72 .25 96 24 1.40 .02 .97 .07 .22 .02 5.55 .29 1.10 .04 .24 .04 .02 .40 .21 .06 .19 .08 .06
324 4.64 .49 84 22 1.33 .02 .66 .05 .14 .02 5.41 .28 .77 .05 .29 .04 .04 .41 .19 .06 .19 .09 .06
Number of
Subscriber Units Outpatient Contacts Inpatient Contacts
Outpatient Procedures Laboratory Tests Radiology Services Average Inpatient Stay Inpatient Surgical Procedures EKGs
Preventive Services* Regularly Scheduled Walk-In Emergency Telephone or Letter Other Patient Cancels
.21 .08 .18 .05 .08
*This section does not include the standard errors; they are all
Abstract: This study investigates whether there is a built-up demand for health services that surfaces when people enroll through a group plan in a Health
Maintenance Organization. The study population consists of newly enrolled subscriber units of the Kaiser Foundation Health Plan (Oregon Region). The utilization variables examined include the number of inpatient and outpatient contacts with the Plan, the number and type of specific services performed, and the type of outpatient contact. The enrollees were followed over 12 quarters (three years). The analysis showed that the first quarter stood out in three respects: its average number of inpatient and outpatient contacts were the lowest of
Health Maintenance Organizations (HMOs) are regarded as one means of dealing with the "medical care crisis" in the United States. Although one type of HMO, the prepaid group practice, has been around for 50 years,' there remain a number of unanswered questions about HMOs. One question of importance revolves around the idea that people who join an HMO do so because they have a built-up demand for health services. This question has been addressed to a degree in some previous studies. Densen, et al,2 mention a study which examined the total number of physician services provided to individuals who were continuously enrolled in the Health Insurance Plan of Greater New York (HIP) for its first four years of existence. The number of physician services were grouped by year for a three-year period. There appeared to be a degree of consistency among utilization levels from year to year although it appears as if regression to the mean was also operating. Densen, et al, followed up on this study by examining three years of data for a randomly selected sample of HIP enrollees who worked for the City of New York. Their results supported the earlier finding of a degree of consistency in utilization patterns. Sparer and Anderson3 provide data on the experience of low-income families who were enrolled in one of four prepaid group practice plans. A part of their study examined physician encounter rates by three-month intervals for the Address reprint requests to Ron N. Forthofer, PhD, Associate Professor of Biometry, Health Science Center at Houston, University of Texas, School of Public Health, P.O. Box 20186, Houston, TX 77025. Dr. Glasser is Associate Professor of Biometry at the University. This paper, submitted to the Journal April 13, 1978, was revised and accepted for publication May 21, 1979.
AJPH November 1979, Vol. 69, No. 11
any quarter; the mean numbers of radiology services and laboratory tests per outpatient contact were the highest during this quarter; and the highest proportion of regularly scheduled contacts and the lowest rate of patient cancellation of visits occurred during the first quarter. Hence, these data are not supportive of the idea of a built-up demand. Rather they suggest that the enrollee requires some time to learn how to deal with the system; and, once a new member contacts the system, the system may perform a number of tests to obtain baseline data about the enrolee. Additional analysis did not suggest the presence of any time trends in the utilization data. (Am J Public Health 69:1127-
1131, 1979.) families' first 18 months of participation in the plans. Results were mixed, although the general trend suggested that the first quarter rates were the highest. Another study by Yesalis and Bonnet4 reported on the Columbia Plan and its membership's ambulatory experiences. They concluded that the rate of provider visits/member/year appeared to peak during the first two quarters and then declined with the rate stabilizing during the second year. The study reported here continues the investigation of the experience of newly enrolled families in a prepaid group plan. Both inpatient and outpatient data are used in the examination of two questions: * Is there evidence of a built-up demand as measured by utilization during the initial quarter of enrollment compared to the second quarter? * Are there any discernible trends in utilization over 12 quarters of observation? In this study, utilization has been partitioned into three components: 1) number of contacts; 2) number of services provided per contact; and 3) type of outpatient appointment behavior. These questions about utilization were assessed with reference to subscriber age, sex, family size, enrollment date, and whether a birth or death occurred in the family during the period under study.
Materials and Method The study population is a sample of new enrollees in the Kaiser Foundation Health Plan (Oregon Region) who were followed over a three-year period. The Kaiser Health Services Research Center maintains an extensive computerized 1127
FORTHOFER AND GLASSER
utilization records system. Since September 1966, Kaiser has collected both inpatient and outpatient data on a randomly selected five per cent sample of subscriber units. This sample is updated monthly to keep the sample representative of the growth of the Health Plan population. The basic data used in this report are the utilization experience generated by the 1,587 units (4,575 people) who joined the sample after 1966 and before 1971, and who were members of the Plan for at least six months. More detail about the demographic characteristics of the Portland population, the Kaiser enrolled population, and the Kaiser five per cent sample is provided by Greenlick et al.5 The persons studied have enrolled mostly as members of a group, although there is some limited enrollment by individuals. The central focus of the analysis is the utilization experience of a subscriber unit i.e., the nuclear family unit, it being assumed that parents determine the utilization of their children. Each subscriber unit was followed over time. The exact number of person-months of membership is used in the analysis, and the utilization experience of each family is related to the person-months of exposure in calculating the appropriate rates. Each subscriber unit's experience was grouped into three-month intervals beginning with the initial date of enrollment and ending at the time of leaving the Plan or the end of the study reference period. If the last interval was less than three months, it was consolidated with the previous interval, and the utilization adjusted to a three-month reference period. The primary emphasis in the analysis was placed on the first two three-month intervals to examine the question of built-up demand, and secondly on the entire time period to examine the possibility of time trends. As detailed in Table 1 three types of utilization variables were considered. * Volume: the number of inpatient and outpatient contacts;
* Intensity: the number of inpatient days and the number of and types of services performed (both inpatient and
outpatient); * Learning: the manner of contact with the Plan as categorized by seven descriptors including place or type of visit and rate of patient cancellation. Analysis of these three types of variables and their components was performed for the entire sample of family units and for the entire sample categorized by the subscriber's age, subscriber's sex, unit (family) size, initial enrollment data for the unit, and occurrence of a birth or death in a unit. Paired t-tests were used to compare the subscriber unit's utilization during the first quarter with its second quarter utilization. To examine whether time trends existed over the three years, ranks were assigned to each quarter based on that quarter's position among all 12 quarters for each variable. No tests were performed in the examination of trends because the data violated one or more of the assumptions of the standard procedures used in hypothesis testing.
Results Table 2 provides the data that are used in the subsequent examination of the specific questions concerning utilization. It is difficult to readily discern patterns that exist across variables or trends over time when examining Table 2. Careful investigation suggests the existence of some patterns and these will be pointed out in the following analyses. The number of subscriber units on which each quarter's data are based is also given in Table 2. The decrease in this number does not indicate that families drop out of the Plan after a short time. Rather this variable reflects that many of the families enrolled sometime into the 1967-70 period, and hence were eligible for a short time before the end of the four-year period of observation.
TABLE 1-Study Variables and their Construction Variable
Volume Outpatient Contacts Inpatient Contacts Intensity Outpatient Procedures Laboratory Tests Radiology Services Average Inpatient Stay Inpatient Surgical Procedures EKG's Learning Preventive Services Regularly Scheduled Walk-In Emergency Telephone or Letter Other Patient Cancels
Construction
Outpatient Contacts/Person Year Inpatient Contacts/i 000 Person Years Outpatient Procedures/Outpatient Contacts Laboratory Tests/(Outpatient + Inpatient Contacts) Radiology Services/(Outpatient + Inpatient Contacts) Inpatient Days/Inpatient Contacts Inpatient Surgical Procedures/Inpatient Contacts EKG's/Inpatient Contacts Preventive Contacts/Outpatient Contacts Regularly Scheduled/Total* Walk-In/Total Emergency/Total Telephone or Letter/Total Other/Total Patient Cancels/Total
*Total = Regularly Scheduled + Walk-In + Emergency + Telephone or Letter + Other + Patient Cancellations.
1128
AJPH November 1979, Vol. 69, No. 11
SERVICES UTILIZATION BY HMO ENROLLEES TABLE 2-Means and Standard Errors for Indicated Variables for the New Enrollees in the Kaiser Portland 5% Sample from 1967-1970 by Three-Month Periods (Mean over Standard Error) Three-Month Periods
1
2
3
4
5
6
7
8
9
10
11
12
1587 3.00 .12 60 11 1.45 .01 1.22 .04 .24 .01 4.49 .07 .61 .02 .15 .02 .04 .44 .25 .08 .14 .05 .04
1587 3.68 .14 120 16 1.39 .01 1.06 .04 .21 .01 4.32 .08 .82 .02 .13 .01 .04 .42 .22 .07 .16 .06 .07
1359 3.48 .13 108 16 1.41 .01 .97 .05 .18 .01 5.67 .24 .69 .02 .24 .02 .04 .40
1201 3.68 .15 96 16 1.39 .01 .86 .04 .19 .01 5.11 .18 .76 .02 .26 .02 .06 .40 .20 .08 .18 .07 .07
1027 3.72 .19 144 23 1.38 .01 .90 .04 .19 .01 4.35 .10 .76 .02 .29 .04 .04 .39 .21 .07 .19 .06 .08
890 4.12 .24 108 19 1.38 .01 .88 .04 .18 .01 4.73 .16 .74 .02 .20 .02 .06 .42 .20 .08 .17 .06 .08
738 4.19 .24 132 27 1.40 .02 .87 .05 .20 .01 3.84 .09 .77 .03 .25 .03 .05 .41 .19 .07 .18 .07 .08
648 4.25 .29 156 27 1.46 .02 .92 .06 .21 .02 4.40 .13 .74 .03 .14 .01 .05 .40 .19 .05 .19 .07 .08
545 3.90 .26 84 23 1.43 .02 .91 .06 .20 .02 4.70 .13 1.06 .04 .30 .03 .05 .41 .20 .06 .21 .07 .06
448 4.01 .27 96 22 1.43 .02 .86 .06 .17 .02 3.70 .07 .71 .03 .20 .03 .05 .38 .23 .06 .18 .07 .08
375 3.72 .25 96 24 1.40 .02 .97 .07 .22 .02 5.55 .29 1.10 .04 .24 .04 .02 .40 .21 .06 .19 .08 .06
324 4.64 .49 84 22 1.33 .02 .66 .05 .14 .02 5.41 .28 .77 .05 .29 .04 .04 .41 .19 .06 .19 .09 .06
Number of
Subscriber Units Outpatient Contacts Inpatient Contacts
Outpatient Procedures Laboratory Tests Radiology Services Average Inpatient Stay Inpatient Surgical Procedures EKGs
Preventive Services* Regularly Scheduled Walk-In Emergency Telephone or Letter Other Patient Cancels
.21 .08 .18 .05 .08
*This section does not include the standard errors; they are all
