PEDIATRICS Vol. 83 No. 2 February 1989, pp. 168-180
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Prepaid Group Practice Effects on the Utilization of Medical Services and Health Outcomes for Children: Results From a Controlled Trial

R. Burciaga Valdez PhD1, John E. Ware Jr PhD1, Willard G. Manning PhD1, Robert H. Brook MD1, William H. Rogers PhD1, George A. Goldberg MD1, and Joseph P. Newhouse PhD1

1 The Health Science Program, The RAND Corporation, Santa Monica, California, and the Departments of Medicine and Public Health, Center for the Health Sciences, University of California at Los Angeles

A total of 693 children between the ages of 0 and 13 years were randomly assigned to either a staff model HMO or to one of several fee-for-service insurance plans in Seattle to evaluate differences in medical expenditures and health outcomes. Although the fee-for-service plans varied the amount of cost sharing (0% to 95%), all children were covered for the same medical services, for either 3 or 5 years. No differences in imputed total expenditures were observed for children assigned to the HMO or any of the fee-for-service plans. Children with cost-sharing fee-for-service plans, however, had fewer medical contacts and received fewer preventive services than those assigned to the HMO. Nonetheless, children with the cost-sharing fee-for-service plans were perceived (by their mothers) to be in better health overall than those assigned to the HMO. No significant differences regarding physiological outcomes (eg, visual acuity, hemoglobin level) were observed between the two groups. The results of this experiment neither strongly support nor indict fee-for-service or prepaid care for children.

Key Words: health • insurance • health maintenance organization • medical care organization

Submitted on October 5, 1987
Accepted on January 14, 1988




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