The November/December 1997 edition of the Kaiser Family Foundation/Harvard Health News Index includes questions about major health issues covered by news media, including questions about AIDS and the Health Care Bill of Rights. The survey was based on a national random sample of 1,201 Americans conducted December 4-9, 1997 which measures public knowledge of health stories covered in the news media the previous month. The Health News Index is designed to help the news media and people in the health field gain a better understanding of which health stories in the news Americans are following and what they understand about those health issues. Every two months, Kaiser/Harvard issues a new index report.

Note: This publication is not available on our website. However, the data from these surveys is still available through the Public Opinion and Media Research Group. Please email kaiserpolls@kff.org for more information.

• Report:

Kaiser/Harvard National Survey Of Americans’ View On Managed Care

Introduction:Hello, my name is _________________ and I’m calling for Princeton Survey Research. I’d like to ask a few questions of the Youngest Male age 18 or older, who is now at home. (If No Male At Home Now : Then, may I speak with the OLDEST FEMALE age 18 or older who is now at home) (Repeat Introduction If Respondent Did Not Answer The Telephone) . We’re conducting an important national opinion survey and would very much like to include your views…

D1.Record Sex 48 Male52 Female

100

For further information contact: Matt James or Tina Hoff

1.To begin, I’m going to ask how things have been going for you and your family in recent years. Compared to a few years ago, are you and your family better off, worse off, or about the same in this area…? And what about…? (Are you and your family better off in this area, worse off, or about the same?

Better Off Worse Off About the Same Don’t Know/ Refused

a. Your overall standard of living 41 10 48 1 =100 b. Your ability to save for the future 37 18 43 2 =100 c.Your ability to get good health care 31 14 53 2 =100

2.Now I’m going to read you some terms having to do with health care. As I read each one, please tell me if you know what it means, OR if you’ve heard of it, but AREN’T SURE what it means, OR if you never heard of it before this interview. (First,) what about this term…?

Know What It Means Heard of. Not Sure What It Means Never Heard of Don’t Know/Refused

a.HMO, or Health Maintenance Organization 62 24 14 *1 =100 b.Medicare 78 20 2 0 =100 c.Managed care 45 26 28 1 =100 d.Primary care doctor 70 17 12 1 =100 e.Medicaid 71 25 4 * =100 f.Gag rules for doctors 25 16 58 1 =100 g.Fee-for-service 41 15 43 1 =100

An asterisk indicates a value of less than 5 percent.

3.Next, I’d like your opinion of the job some different groups are doing in serving the needs of health care consumers. In answering, please consider everything that might be important to consumers, including quality, cost and convenience.

First, in general, do you think are doing a good job or a bad job in serving health care consumers? Next, do you think… are doing a good job or a bad job ?

Good Job Bad Job Mixed/Neither Good Nor Bad (VOL.) Don’t Know/Refused

a.Doctors 69 12 16 3 =100 b.Pharmaceutical or drug companies 62 20 11 7 =100 c.HMOs, or Health Maintenance Organizations 36 25 12 27 =100 d.Hospitals 61 18 15 6 =100 e.Health insurance companies 44 32 16 8 =100 f.Nurses 83 4 8 5 =100 g.Managed care health plans 34 21 13 32 =100

4. You said you think HMOs do a (INSERT RESPONSE FROM Q.3c– good job/bad job) of serving consumers. What is the MAIN reason you feel this way? Is it your own experience with an HMO; what you’ve learned from friends and family; or what you’ve seen or heard on television, in newspapers or other media?

Based on all who say HMOs do a good job; n=438

Based on all who say HMOs do a bad job; n=295

Good Job Bad Job

49 42 Own experience 29 32 Friends and family 17 18 TV, newspapers or other media 2 6 Other (VOL.) 3 2 Don’t know/refused

100 100

5.You said you think managed care plans do a of serving consumers. What is the MAIN reason you feel this way? Is it your own experience with a managed care plan; what you’ve learned from friends and family; or what you’ve seen or heard on television, in newspapers or other media?

Based on all who say managed care plans do a good job; n=402

Based on all who say managed care plans do a bad job; n=264

Good Job Bad Job

35 39 Own experience 32 32 Friends and family 24 22 TV, newspapers or other media 4 4 Other – VOLUNTEERED 5 3 Don’t know/refused

100 100

6.Now I’m going to read you another list of some groups in health care. This time, please tell me whether you think of each group more as a business looking out for its bottom line OR more as an organization whose main purpose is to serve people like you. (First,) what about…?

Based on Form 1 respondents; n=605

Looking Out For Bottom Line Serving People Like You Don’t Know/Refused

a.HMOs and other managed care plans 54 23 23 =100 b.Companies providing traditional health insurance coverage 63 28 9 =100 c.Hospitals 50 39 11 =100 d.Doctor’s offices and clinics 38 52 10 =100 e.Pharmacies or drugstores 48 46 6 =100

7.Now I’m going to read you some characteristics of health insurance plans. As I read each one, please tell me which type of plan you think has this characteristic — MANAGED CARE plans, TRADITIONAL health insurance plans, or both types of plans. (First,) which type of plan has this characteristic…

Based on Form 1 respondents; n=605

ManagedCare Traditional Health Plans Both -VOL-Neither Don’t Know/Refused

a.Patients must see their primary care or family doctor first, before they can be referred to another doctor or medical specialist. 53 14 24 1 8 =100 b.Patients must pay additional fees to use doctors or hospitals who are not part of the plan. 50 16 22 1 11 =100 c.Puts more emphasis on preventive care and other health improvement programs. 36 24 24 3 13 =100 d.Doctors must follow certain health plan guidelines on the types of treatments and drugs they can give to patients. 47 14 29 1 9 =100 e.Patients must get approval from the health insurance plan before they can receive expensive medical treatment. 48 13 30 1 8 =100 f.Offers a wider range ofbenefits at a lower cost. 39 25 19 4 13 =100 g.Nurses provide much of the routine care that was once handled by doctors 37 16 34 1 12 =100 h.Is more likely to limit payment for certain types of health services when people are sick, in order to keep costs low 48 16 26 1 9 =100

8.Health insurance plans differ from each other in a number of ways. We’d like to know how different characteristics of a health plan might affect your overall opinion of it. First, if you knew that a health plan had this characteristic… would it make your opinion of the plan more favorable, less favorable, or would it not make much difference either way? Next, what if you knew a plan had this characteristic…

Based on Form 2 respondents; n=599

More Favorable Less Favorable Wouldn’t Make Much Difference Refused Don’t know/refused

a.Patients must see their primary care or family doctor first, before they can be referred to another doctor or medical specialist. 36 42 19 3 =100 b.Patients must pay additional fees to use doctors or hospitals who are not part of the plan. 12 68 15 5 =100 c.Puts more emphasis on preventive care and other health improvement programs. 71 8 17 4 =100 d.Doctors must follow certain health plan guidelines on the types of treatments and drugs they can give to patients. 34 44 17 15 =100 e.Patients must get approval from the health insurance plan before they can receive expensive medical treatment. 21 58 18 3 =100 f.Offers a wider range of benefits at a lower cost. 80 7 10 3 =100 g.Nurses provide much of the routine care that was once handled by doctors 36 31 30 3 =100 h.Is more likely to limit payment for certain types of health services when people are sick, in order to keep costs low. 32 48 14 16 =100

ASK ALL:9.Are you, yourself, now covered by any form or health insurance or health plan, including Medicare or Medicaid?

10.How long has it been since you last had ANY kind of health insurance coverage?

82 Insured 17 Total uninsured Last Had Coverage 5 Less than a year ago 3 One to two years ago 2 Three to five years ago 5 Five or more years ago 2 Never had coverage * Don’t know when last insured 1 Don’t know if insured 100

11.Based on all your experience with your current health insurance plan, we’d like you to grade the plan’s performance. If A means excellent, B good, C average, D poor and F failing, what letter grade would you give to your health plan?

Based on all those who are insured; n=991

National National 28 A — excellent 43 B — good 19 C — average 6 D — poor 1 F — failing 2 Not with plan long enough to rate (VOL.) 1 Don’t know/refused 100

11. (Subgroup)Based on all your experience with your current health insurance plan, we’d like you to grade the plan’s performance. If A means excellent, B good, C average, D poor and F failing, what letter grade would you give to your health plan?

Based on all those who are insured; subgroup n=778

Heavy Light Traditional

20 24 33 A — excellent 44 44 43 B — good 25 20 15 C — average 7 9 4 D — poor 3 1 0 F — failing * 1 3 Not with plan long enough to rate (VOL.) 1 2 2 Don’t know/refused 100 101 100

For my next question, I want you to think about the LAST health insurance plan you had.

12.After I read you a brief description of two different types of health plans, please tell me which type you have today (had in the past) as your MAIN health coverage…

13.From what you know, is (was) your plan….Traditional health insurance plans allow you to go to almost any doctor or hospital, but often pay only 80% of the costs of your visit.

Managed Care plans, such as HMOs and PPOs, direct you to a list of doctors and hospitals who are in the plan. If you use doctors or hospitals on the list, the plan pays all or nearly all of the costs. But you have to pay extra if you want to use a doctor or hospital who is not on the list.

To the best of you knowledge, are (were) you covered by…

Based on all who are insured or were insured in the past; n=1163

Based on all who are insured; n=991

Total Now/Past Now Covered 45 44 A traditional health insurance plan, OR 47 50 A managed care plan? 23 23 An HMO, that is, a Health Maintenance Organization 14 16 A PPO, that is, a Preferred Provider Organization, OR 5 5 Some OTHER type of managed care plan? 5 6 Don’t know which type of managed care 8 6 Don’t know/refused 100 100

Ask All:14.Now I’d like your views on HMOs and other managed care plans in general, regardless of whether you are personally in managed care. During the past few years, do you think HMOs and other managed care plans have…

a.Made it easier or harder for people who are sick to see medical specialists?25 Easier 59 Harder 4 No effect (VOL.) 12 Don’t know/refused 100

b1.Increased or decreased the quality of health care for people who are sick?

Based on Form 1 respondents; n=605

32 Increased 51 Decreased 7 No effect (VOL.) 10 Don’t know/refused 100

b2.Increased or decreased the quality of health care for patients?

Based on Form 2 respondents; n=599

32 Increased 45 Decreased 8 No effect (VOL.) 15 Don’t know/refused 100

c.Made it easier or harder to get preventive services such as immunizations, health screenings, and physical exams?

b2.Increased or decreased the quality of health care for patients?

Based on Form 2 respondents; n=599

46 Easier 31 Harder 8 No effect (VOL.) 15 Don’t know/refused 100

d.Helped keep health care costs down, or haven’t made much difference?

28 Helped 55 Haven’t made much difference 5 Made costs go up (VOL.) 12 Don’t know/refused 100

e.Increased or decreased the amount of time doctors spend with their patients?

16 Increased 61 Decreased 9 No effect (VOL.) 14 Don’t know/refused 100

15.As far as you know, do doctors in HMOs and other managed care plans make more money by increasing the amount of services and procedures to patients, OR by limiting the amount of services and procedures?

Based on Form 1 respondents; n=605

31 Increasing referrals 30 Limiting referrals 3 No difference (VOL.) 16 Don’t know/refused 100

Ask All:17.Do you think money saved by HMOs and other managed care plans…

Yes No – VOL-Plans Don’t Actually Save Any Money Don’t know/Refused

a.Allows employers to pay less forhealth insurance? 56 26 1 17 =100 b.Helps health insurance companiesearn more profits? 72 11 1 16 =100 c. Makes health care more affordable for people like you? 49 38 1 12 =100

18.How often do you trust Your Primary Care Or Family Doctor to do the right thing for your care? Would you say…

National 52 Just about always 31 Most of the time, OR 12 Only some of the time? 1 None of the time (VOL.) 2 Don’t have a primary care doctor (VOL.) 2 Don’t know/refused 100

18. (Subgroup)How often do you trust Your Primary Care Or Family Doctor to do the right thing for your care? Would you say…

Subgroup n = 778 Heavy Light Traditional 50 52 63 Just about always 32 36 28 Most of the time, OR 13 10 15 Only some of the time? 1 1 0 None of the time (VOL.) 1 * 4 Don’t have a primary care doctor (VOL.) 2 2 1 Don’t know/refused 99 100 101

19.How often do you trust Your Current Health Insurance Plan to do the right thing for your care? Would you say…

Based on all who are insured; n=991

National 41 Just about always 39 Most of the time, OR 16 Only some of the time? 1 None of the time (VOL.) 3 Don’t know/refused 100

19. (Subgroup)How often do you trust Your Current Health Insurance Plan to do the right thing for your care? Would you say…

Based on all who are insured; subgroup n=778

Heavy Light Traditional 30 31 35 Just about always 46 45 34 Most of the time, OR 22 19 6 Only some of the time? 1 1 1 None of the time (VOL.) 1 3 3 Don’t know/refused 100 99 99

20.If you went to the emergency room, how likely do you think it is that your health plan would pay for the visit–very likely, somewhat likely, not too likely, or not at all likely?

Based on Form 1 respondents who are insured; n=519

National 64 Very likely 24 Somewhat likely 5 Not too likely 5 Not at all likely * It depends (VOL.) 2 Don’t know/refused 100

20. (Subgroup)If you went to the emergency room, how likely do you think it is that your health plan would pay for the visit–very likely, somewhat likely, not too likely, or not at all likely?

Based on Form 1 respondents who are insured; subgroup n=409

Heavy Light Traditional 56 63 78 Very likely 31 24 18 Somewhat likely 4 6 3 Not too likely 8 3 2 Not at all likely 0 2 0 It depends (VOL.) 2 2 0 Don’t know/refused 101 100 101

21.If you had a serious medical problem requiring costly treatment, how likely do you think it is that your health plan would pay most of the cost–very likely, somewhat likely, not too likely, or not at all likely?

Based on Form 2 respondents who are insured; n=472

National 55 Very likely 33 Somewhat likely 5 Not too likely 5 Not too likely 2 Not at all likely 1 It depends (VOL.) 4 Don’t know/refused 100

21. (Subgroup)If you had a serious medical problem requiring costly treatment, how likely do you think it is that your health plan would pay most of the cost–very likely, somewhat likely, not too likely, or not at all likely?

Based on Form 2 respondents who are insured; subgroup n=369

Heavy Light Traditional 44 54 69 Very likely 42 37 23 Somewhat likely 7 6 0 Not too likely 3 2 1 Not at all likely 2 0 0 It depends (VOL.) 1 1 7 Don’t know/refused 99 99 100

Ask All:22. In the past 12 months, have you gone to an emergency room for medical care?

23.Did you have health insurance coverage the LAST time you went to an emergency room?

27 Yes 22 Insured at the time 5 Not insured * Don’t know if insured 73 No * Don’t know 100

24.Did you have a problem having the bill paid by your health insurance plan, or not?

Based on used E.R. In past year while insured; n=266

23 Yes 74 No 3 Don’t know 100 Ask All:25.In the past 12 months, was there ever a time when you thought you needed medical care from an emergency room but did not go?

26.Did you have health insurance coverage the LAST time this happened?

Refrained from using E.R. in past year16 Yes 11 Insured at the time 5 Not insured * Don’t know if insured 84 No * Don’t know 100

27. Why didn’t you go to an emergency room for care when you thought you needed it? Was it MAINLY because you didn’t think your health plan would pay for it, or was it mainly for some other reason?

Based on refrained from using E.R. in past year while insured; n=123

41 Didn’t think plan would pay 53 Some other reason 11 Insured at the time 6 Don’t know/refused 100

28.If you were sick, how worried would you be that your Doctor would be more concerned about saving money for the health plan than about what is the best treatment for you? Would you be..

Based on all who are insured; n=991

National 12 Very worried 18 Somewhat worried 23 Not too worried, OR 2 Don’t know/refused 100

28. (Subgroup)If you were sick, how worried would you be that your Doctor would be more concerned about saving money for the health plan than about what is the best treatment for you? Would you be..

Based on all who are insured; subgroup n=778

Heavy Light Traditional 16 12 7 Very worried 25 17 16 Somewhat worried 21 27 20 Not too worried, OR 34 43 54 Not at all worried? 3 1 2 Don’t know/refused 100 100 99

29.If you were sick, how worried would you be that your Health Plan would be more concerned about saving money than about what is the best treatment for you? Would you be…

Based on all who are insured; n=991

National 18 Very worried 29 Somewhat worried 21 Not too worried, OR 30 Not at all worried? 2 Don’t know/refused 100

29. (Subgroup)If you were sick, how worried would you be that your Health Plan would be more concerned about saving money than about what is the best treatment for you? Would you be…

Based on all who are insured; subgroup n=778

Heavy Light Traditional 24 19 12 Very worried 37 32 22 Somewhat worried 19 24 24 Not too worried, OR 18 25 38 Not at all worried? 1 1 3 Don’t know/refused 99 101 99

30.We’re interested in what your health insurance plan will pay for when you are sick. As far as you know, is there a set of guidelines that allows your health plan to say “no” to certain types of treatment that are covered by the plan, or will your health plan pay for most everything your doctor thinks is necessary for your treatment?

Based on all who are insured; n=991

35 Set of guidelines allowing plan to say “no” 58 Plan will pay for everything 7 Don’t know/refused 100

31.Suppose your current health insurance plan were discontinued and you had to choose a new one for you and your family…

Suppose you had to choose a new health insurance plan for you and your family…

How important would each of the following be to you to help you choose a health plan? (First/Next), how important would it be for you to know : very important, somewhat important, not too important, or not at all important?

Very Important Somewhat Important Not Too Important Not At All Important Don’t know/Refused

a.How much you have to payfor the plan 77 19 2 1 1 =100 b.Whether the plan has a wide range of benefits or a particular benefit you need 82 14 1 1 2 =100 c.How well the health plan takes care of members who are sick or have health problems 89 8 * 1 2 =100 d.Whether the plan offers awide choice of doctors 75 18 3 2 2 =100 e.Whether the plan has passed a review and been accredited by an independent organization 58 28 5 5 4 =100 g.Whether the hospital youprefer to use is in the plan 73 18 5 3 1 =100

32.Which One of the concerns you rated as very important would be Most important to you?

22 How much you have to pay 17 Whether the plan has a wide range of benefits 25 How well the health plan takes care of members who are sick 8 Whether the plan offers a wide choice of doctors 3 Whether the plan has passed a review and been accredited 3 Whether the plan has passed a review and been accredited 3 Whether the plan has passed a review and been accredited 15 Whether your current doctor is in the plan 5 Whether your preferred hospital is in the plan * Other * 1 No item rated very important 4 Don’t know/refused 100

Ask All:33.If you had a serious complaint or problem with your health insurance plan, which ONE of the following do you think would be most helpful to you in solving that problem?

34 Someone at the plan 21 Someone at work involved with health benefits 9 A state government agency, OR 27 An independent organization like the Better Business Bureau? 1 Other 8 Don’t know/refused 100

34.Different groups in health care advertise their services in newspapers, on radio and television. During the past 12 months, have you personally seen or heard any advertisements by… , or not?

Yes No Don’t know/Refused

a.Hospitals 58 41 1 =100 b.Doctors 35 63 2 =100 c.Health insurance companies 67 31 2 =100 d.HMOs or managed care companies 61 34 5 =100

35.We’re interested in how often you think you can trust what certain groups have to say in their advertisements. First, do you think you can trust what… say in their advertisements most of the time, sometimes, hardly ever or never? And how often can you trust what… say in their advertisements?

Based on Form 1 respondents; n=605

Most ofThe Time Sometimes Hardly Ever Never Don’t know/Refused

a. Hospitals 27 40 17 11 5 =100 a. Hospitals 27 40 17 11 5 =100 b. Lawyers 15 25 25 28 7 =100 c. Health insurance companies 23 42 20 9 6 =100 c. Health insurance companies 23 42 20 9 6 =100 d Pharmaceutical or drug companies 28 38 15 15 4 =100 e. Doctors 24 36 18 14 8 =100 f. HMOs or managed care companies 19 38 19 13 1 =100 g. Politicians 11 24 28 31 6 =100

37.The number of Americans who rely on HMOs and other managed care health plans for their health coverage continues to grow. Some people say the government needs to protect consumers from being treated unfairly and not getting the care they should from managed care plans. Others say this additional government regulation isn’t worth it because it would raise the cost of health insurance too much for everyone. Which position comes Closer to your own view?

Based on Form 1 respondents; n=605

52 Government should protect consumers 40 Government regulation would raise the cost too much 8 Don’t know/refused 100

38.In recent months, different groups have said something needs to be done to regulate the operations of HMOs and other managed care plans. Would you Most like to see these managed care plans regulated by…

Based on Form 2 respondents; n=599

19 The federal government, 18 State governments, 34 An independent, non-profit organization, or 16 Not be regulated at all? 2 Regulated by other group (VOL.) 11 Don’t know/refused 100

Ask All:39.Do you think current government rules that regulate HMOs and other managed care plans are…

21 Too strict 23 About right, OR 38 Not strict enough? 18 Don’t know/refused

40.Some people say that managed care plans should give doctors financial incentives to avoid unnecessary services and hold down costs. Others say this threatens the quality of care patients receive and that doctors should not be given incentives to limit services. Which comes closer to your view?

24 Should give doctors incentives 65 Threatens quality of care 11 Don’t know/refused 100

41.Next, we’re interested in your views on media coverage of HMOs and other managed care plans. In general, do you think media coverage of HMOs and other managed care plans has been favorable, unfavorable, or mixed?

54 Fair 19 Unfair 11 Mixed/Some fair, some unfair (VOL.) 16 Don’t know/refused 100

43.During the past 12 months, how much have you personally seen or heard in the media about HMOs or managed care? Would you say a lot, some, only a little, or nothing?

18 A lot 38 Some 31 Only a little 1 Don’t know/refused 100

44.Recently, there have been some news stories about people having bad experiences with their HMOs and other managed care plans. I’m going to briefly describe a few of these news stories. After I read each one, tell me if you think this kind of experience happens often, sometimes, or rarely to people in managed care.

Here’s the (first/next) story… Do you think this happens often, sometimes, or rarely to people in managed care?

Based on Form 2 respondents; n=599

Often Sometimes Rarely Don’t know/Refused

a.”A family says their HMO held back ontheir child’s cancer treatment” 26 40 23 11 =100 b.”A man went to an emergency room for stomach pains without calling his HMO first. Afterward, the HMO refused to pay any of his bill because he failed to get permission to be treated in an emergency room.” 46 31 14 9 =100 c.”A newborn baby returned to the hospital, seriously ill, the day after he had been sent home because of an HMO rule that allowed only a one-day hospital stay. The baby had been sent home from the hospital even though his mother expressed concerns about his health” 39 34 18 9 =100

45.Now I have a few questions about your own health insurance. How long have you been enrolled in your current health plan?

Based on all who are insured; n=991

16 Less than one year 22 One to less than three years 15 Three to less than five years 15 Five to less than ten years 30 Ten years or more 2 Don’t know/refused 100

46.Are you NOW covered by a private health insurance plan through your employer or someone else’s employer, or don’t you have coverage through an employer?

Based on all who are insured; n=991

57 Yes, through own employer/former employer 16 Yes, through someone else’s employer/former employer 25 Three to less than five years 15 No, not through an employer 2 Don’t know/refused 100

47.At any time in the past five years, were you forced to change from one health plan to another because of a decision by an employer?

Based on all who are insured; n=991

21 Yes, through own employer/former employer 16 Yes 51 No 27 Don’t have employer provided coverage 1 Don’t know/refused 100

48.When you enrolled in your current health plan, did you have a choice of more than one plan, or was only one plan available?

49.How many plans were available for you to choose from?

Based on all who are insured; n=991

Had Choice of Health Plans 55 Yes 3 Eight or more plans * Seven plans 2 Six plans 5 Five plans 7 Four plans 15 Three plans 15 Two plans 8 Don’t know how many plans 41 No choice, only one plan available 4 Don’t know/refused 100

50.Earlier in this interview, I asked you about some different features of health plans. When you chose your current plan, do you think there was enough variety — or NOT enough variety — among the plans you had to choose from?

Based on all who are insured; n=991

44 Enough variety 9 Not enough variety 45 Didn’t report having a choice of plans 2 Don’t know/refused 100

51.Now, I’m going to ask you about some of the characteristics of your current health insurance plan (your LAST health insurance plan). Some plans charge less if you choose your doctor from a list, but make you pay more if you go to a doctor not on the list. Does (Did) your plan work this way, or not?

Based on all who are insured or were insured in the past; n=1163

Based on all who are insured; n=991

Total Now/Past Now Covered 49 50 Yes 43 43 No 8 7 Don’t know/refused 100 100

52.Some plans require you to sign up with a specific primary care doctor or group of doctors who provide all your routine health care. Does (Did) your plan work this way, or not?

Based on all who are insured or were insured in the past; n=1163

Based on all who are insured; n=991

Total Now/Past Now Covered 46 46 Yes 49 49 No 5 5 Don’t know/refused 100 100

53.Some plans require you to have approval or a referral before they will pay for any of your costs for visiting a doctor who is not in the plan. Does (Did) your plan work this way, or not?

Based on all who are insured or were insured in the past; n=1163

Based on all who are insured; n=991

Total Now/Past Now Covered 47 47 Yes 44 45 No 9 8 Don’t know/refused 100 100

54.Some plans require you to have a referral by a primary care doctor before you can see a medical specialist. Does (Did) your plan work this way, or not?

Based on all who are insured or were insured in the past; n=1163

Based on all who are insured; n=991

Total Now/Past Now Covered 54 53 Yes 37 39 No 9 8 Don’t know/refused 100 100

55.Some plans allow you to go to any doctor or hospital and then submit your bill for reimbursement. Does (Did) your plan work this way, or not?

Based on all who are insured or were insured in the past; n=1163

Based on all who are insured; n=991

Total Now/Past Now Covered 46 48 Yes 47 48 No 7 6 Don’t know/refused 100 100

Ask All:

56.Thinking now about your own health …In general, would you say your health is excellent, very good, good, only fair, or poor?

24 Excellent 34 Very good 27 Good 10 Only fair 4 1 Don’t know/refused 100

57.Does any disability, handicap, or chronic disease keep you from participating fully in work, school, housework, or other activities, or not?

14 Yes 85 No 1 Don’t know/refused 100

58.Were you hospitalized for anything in the past 12 months, that is, since (August/September) 1996? IF FEMALE, ADD: other than for a normal, uncomplicated delivery of a baby?

14 Yes 85 No 1 Don’t know/refused 100

59.Has a doctor or other health professional ever told you that you have any of the following conditions?

Yes No Don’t know/Refused

a.Heart disease, including high blood pressure 21 78 1 =100 b.Stroke 3 96 1 =100 c.Emotional or mental illness 5 94 1 =100 d.Cancer 6 93 1 =100 e.Diabetes 6 93 1 =100

60.As you may know, physician-assisted suicide involves a doctor giving a terminally ill patient the means to end his or her life. Do you think it should be legal for a doctor to help a terminally ill patient commit suicide, or not?

45 Yes, should be legal 44 No, should not 11 Don’t know/refused 100

Demographics:Now I have just a few questions for classification purposes only…

D2. In politics TODAY, do you consider yourself a Republican, Democrat, or Independent?

24 Republican 34 Independent 1 Other party 4 None 6 Don’t know/refused 100

D3.Are you NOW self-employed, are you employed by someone else, are you retired, or are you not employed for pay?

12 Self-employed 52 Employed by someone else 18 Retired 12 Not employed 1 Disabled (VOL.) 2 Other (full-time student, homemakers, etc.) (VOL.) 3 Don’t know/refused 100

D4.Are you NOW working full-time or part-time hours?

53 Full-time 11 Part-time 36 Not employed * Don’t know/refused 100

Ask All:D5.Are you married, LIVING AS married, divorced, separated, widowed, or have you never been married?

53 Married 2 Living as married 2 Divorced 3 Separated 9 Widowed 20 Never been married 4 Don’t know/refused 100

D6.Are you the parent or guardian of any children under 18 now living in your household?

36 Yes 61 No 3 Don’t know/refused 100

D7.What is the LAST grade or class that you COMPLETED in school?

5 None, or grade 1-8 11 High school incomplete (grades 9-11) 32 High school graduate (grade 12 or GED certificate) 3 Business, technical, or vocational school AFTER high school 23 Some college, no 4-year degree 16 College graduate (B.S., B.A., or other 4-year degree) 6 Post-graduate training or professional schooling after college (e.g., toward a master’s degree or PhD; law or medical school) 4 Don’t know/refused 100

D8.What is your age?

21 18 – 29 39 30 – 49 19 50 – 64 15 65 + 6 Refused 100

D9.Last year, that is in 1996, what was your total family income from all sources, before taxes? Just stop me when I get to the right category.

8 Less than $10,000 14 $10,000 to under $20,000 15 30 – 49 20 $30,000 to under $50,000 13 $50,000 to under $75,000 6 $75,000 to under $100,000 4 $100,000 or more 4 Don’t know 16 Refused 100

D10.Are you, yourself, of Hispanic or Latino origin, such as Mexican, Puerto Rican, Cuban, or some other Spanish background?

4 Yes 91 No 5 Don’t know/refused 100

D11.What is your race? Are you white, black, Asian, or some other race?

80 White 10 Black/African-American * Asian 3 Other 1 Mixed 6 Don’t know/refused 100

Region:

20 NE 25 MW 34 SOUTH 21 WEST 100

That completes the interview. Thank you very much for your time and cooperation. Have a nice day/evening.

Is There A Managed Care “Backlash?” :Press Release Survey Chart Pack

A report by Carol S. Weisman, Ph.D., School of Public Health, University of Michigan examines affiliations between Catholic and non-Catholic health care providers and their impact on the availability of reproductive health services in communities. The number and types of formal affiliations (including joint ventures, mergers, acquisitions, consolidations, and long-term lease agreements) involving Catholic health care organizations between 1990 and 1996 are described, and a comparative case studies illustrate the affiliation process and its outcomes. This report was discussed at a briefing held for journalists on November 4, 1997 in New York City as part of a joint program by The Alan Guttmacher Institute, The Kaiser Family Foundation and the National Press Foundation.

Executive Summary

Full Report

The Impact of Managed Care Legislation: An Analysis of Five Legislative Proposals from California

Health Policy Economics GroupPrice Waterhouse LLP

November, 1997

Executive Summary

Managed care has grown tremendously in recent years. From 1988 to 1997, at firms with 200 or more employees, the proportion of employees enrolled in HMOs nationwide increased from 18 percent to 33 percent. The presence of managed care varies by state across the country but is particularly strong in California where the proportion of HMO enrollment is more than 50 percent of the private insurance market in several large metropolitan areas. For example, in Sacramento, 92 percent of those with private insurance are enrolled in HMOs; in San Francisco and San Jose, the proportion is more than 68 percent.

As managed care has grown, in California and throughout the country, complaints against managed care plans have also mounted. Patients have raised concerns that managed care plans deny necessary coverage or provide access to mainly lower quality services. Physicians and other providers have expressed concerns that managed care plans may dictate care, monopolize the marketplace, and exclude independent practitioners. As a result, legislation aimed at addressing some of these concerns has been proposed at the federal and state levels.

This report presents results from a study conducted by Price Waterhouse LLP which was commissioned by The Henry J. Kaiser Family Foundation. The purpose of the study was to assess the impact of managed care reform legislation on HMOs and their enrollees. Specifically, the study analyzes five areas of California legislation: insurer liability, use of drug formularies, mental health parity, direct access to obstetric and gynecologic services, and lengths of stay for mastectomy patients. For each of these areas, the paper examines the specifics of the legislative bills in California, the likely impact of the legislation on HMOs by organizational type, and the corresponding effects for consumers.

Measuring the Impact of Managed Care Legislation

For the most part, many of the concerns about managed care plans have arisen because of the nature of the services provided by these plans. Managed care plans offer a lower-cost alternative to traditional, fee-for-service health insurance. Managed care plans are able to keep costs low through the use of various cost-saving strategies. For example, most HMOs limit access to providers by the use of a gatekeeper, usually a primary care physician, who must give prior approval before enrollees receive services from other providers, such as hospitals and medical specialists. Managed care plans also engage in practices of limiting the types of services provided to enrollees. For example, they may deny coverage for diagnostic tests and other procedures that the plan determines not to be medically necessary. They encourage outpatient treatment rather than inpatient care, and, when inpatient treatment is necessary, they encourage short hospital stays. The purpose of much of the recently proposed legislation is to protect consumers from some of the least desirable features of managed care cost-saving practices.

Managed care legislation, like most consumer protection, has positive and negative aspects. On the positive side, most of the proposals are intended to improve access to health care providers and medical services. As an example of managed care legislation, health plans could be required to give enrollees access to any provider that they choose. This would increase access to a variety of providers and have positive benefits for enrollees. On the other hand, this type of legislation might be costly to HMOs and other managed care organizations. If HMOs incur increased costs as a result of legislation, they would likely reduce covered services or increase enrollee premiums and/or out-of-pocket costs. If HMOs increase their rates, or reduce benefits, then some enrollees may decide to enroll in traditional insurance plans. In the extreme, managed care regulation could make managed care noncompetitive with traditional, fee-for-service insurance.

Difference in Impact by Type of HMO. The impact of consumer protection legislation may vary depending on the type of managed care plan. There are four basic types of HMOs:

• Staff model-Physicians practice as employees of the organization, frequently in an office comprised of only HMO staff.
• Group model-The managed care organization pays a physician group a negotiated, per capita rate which the group then distributes among the individual physicians.
• Network model-HMOs contract with two or more group practices and usually pay a fixed monthly fee per enrollee.
• Independent practice/physician association (IPA) model-HMOs contract with individual physicians in independent practice or with associations of independent physicians.

Because the physician and the plan are much more integrated in staff and group model HMOs than in IPA and network model HMOs, staff and group model HMOs are most likely to be able to manage care as well as coordinate and control the behavior of plan physicians. IPA and network model HMOs, on the other hand, are more loosely designed and thus are more limited in the methods by which they can control plan physicians.

For the most part, legislation aimed at reforming managed care seems directed toward HMOs. Although there are forms of managed care plans other than HMOs-such as preferred provider organizations (PPOs) and point-of-service plans (POSs)-that may be impacted by health care legislation, this study primarily focuses on the impact of managed care legislation on HMOs.

ERISA. The impact of state managed care legislation could be limited because of preemptions under the Employee Retirement Income Security Act (ERISA) of 1974. ERISA provides a broad federal preemption of state laws that relate to employee benefit plans. State insurance laws, however, do not fall under this preemption. Thus, state laws may affect non-self-insured employer-sponsored plans through regulation of the insurers. Because of ERISA, non-risk-bearing networks contracting only with self-insured plans and the self-insured plans themselves are exempt from complying with state managed care legislation. With respect to liability, however, both non-self-insured and self-insured plans can be shielded by ERISA from state attempts to expand insurer liability. Plaintiffs are permitted to sue only for the value of the benefit denied. They are not permitted to sue for other damages under ERISA. Because of ERISA preemptions, the effects of state-level managed care reforms would be limited since many employer-sponsored plans will not be affected by these reforms. Only the federal government can enact legislation that governs all managed care plans.

Insurer Liability

Background. Traditionally, insurance plans have not been the target of liability suits since they have not been viewed as being participants in the decision-making process regarding the treatment of patents. With the evolution of managed care, this has changed. By definition, managed care plans manage patient care. The plans not only reimburse a portion of the medical expenses incurred by a patient, they may also greatly influence a patient’s treatment. As a result, recently, there has been a legislative movement to hold managed care plans legally accountable for their role in the decision-making process of patient care. The concept behind the legislation is the idea that if managed care plans face a greater potential for lawsuits, they will be more likely to make decisions that are in the best interest of their patients.

Legislation. Insurer liability legislation has been introduced in the U.S. Congress and in numerous states. In 1997, the California legislature considered five bills related to insurer liability. Three of the bills-SB 324, SB 557, and AB 794-extend liability to managed care organizations by expanding the definition of the practice of medicine to include decisions regarding the medical necessity or appropriateness of any diagnosis, treatment, operation, or prescription. Among other actions, AB 794 also requires that health plans make available to the public, upon request, the criteria used by plans to determine whether to deny or authorize health care services. A fourth bill, AB 536, solely requires plans to make available to the public, upon request, the criteria used in deciding whether to deny or authorize care. The fifth bill, AB 977, provides that a health care service plan would be liable for damages for harm to an enrollee that is caused by the plans failure to exercise ordinary care or caused by decisions made by employees, agents, ostensible agents, or certain representatives of the health care service plan.

Impact. In this study, we assess the impact of expanding liability to managed care organizations through legislation. We find that the impact of expanding malpractice to managed care plans has the potential to greatly reduce their ability to control costs through case management, especially for group model HMOs, but the actual impact may be negligible because of a number of mitigating factors.

First, most employer-sponsored plans may be able to avoid liability by claiming the ERISA preemption. Second, to the extent that group model HMOs are currently being successfully sued in California, then the potential for additional lawsuits may be slight for those HMOs. Therefore, the impact of managed care liability legislation may mainly be limited to a subset of IPA model HMOs, but the effect on these HMOs would be modest. We estimate that at the most, premiums of IPA model HMOs would increase from 0.1 to 0.4 percent.

To the extent that management efficiency is reduced as a result of expanded liability, enrollees would likely gain access to care that they otherwise would not have received. Some of this care may be appropriate and necessary, thus improving the quality of treatment for some enrollees.

Use of Drug Formularies

Background. In the early 1990s, many managed care organizations adopted the use of drug formularies as a method for reducing the costs of prescription drug coverage. A formulary is a list of drugs, rated on clinical and cost criteria, that have been approved and are covered by the plan for treatment of particular illnesses. As a result of concerns about the effects of formularies on managed care enrollees, various forms of legislation have been created.

Legislation. In 1997, more than 40 bills concerning drug formularies have been introduced in more than 25 states. In 1997, the California legislature considered three bills that address issues related to drug formularies: SB 625, AB 974, and AB 1333. SB 625 requires that plans provide an expeditious process by which prescribing providers may obtain authorization for a medically necessary nonformulary prescription drug, make known to the enrollee any reason for disapproval, and make available their formularies upon request. AB 974 requires that a plan provide coverage for a drug if coverage for that drug had been previously approved by the plan for the enrollee and if the drug continues to be prescribed by the physician. AB 1333 prohibits a plan from requiring physicians to prescribe a drug from the formulary if the appropriate drugs from the formulary have been tried and have been unsuccessful in treating the patient.

Impact. By making the consumer better informed, legislation such as SB 625 may enable enrollees in managed care plans to have more negotiating power regarding their treatment, but we do not expect large financial consequences for managed care plans. Based on our assumption that formularies enable plans to save money by providing the most cost-effective medications, as a result of AB 974 and AB 1333, we would expect HMOs (particularly IPA model HMOs) to incur increased costs. Because these bills are limited in scope, the resulting increases in premiums for HMOs would be fairly modest-most likely significantly less than 0.6 percent. In general, both AB 974 and AB 1333 provide certain enrollees easier access to nonformulary drugs while not having a significant impact on the financial stability or the management style of HMOs.

Mental Health Parity

Background and Legislation. The idea of requiring parity in health insurance coverage for mental disorders has been a much debated issue in recent years. In 1996, President Clinton signed into law the Mental Health Parity Act of 1996 which amended ERISA and the Public Health Service Act to provide parity between annual and/or aggregate lifetime dollar limits on mental health benefits with the limits on medical and surgical benefits of group health plans. Various forms of mental health parity legislation have been passed in numerous states. In 1997, the California legislature considered AB 1100 which would mandate health care plans to cover biologically based severe mental illnesses for enrollees of all ages and cover serious emotional disturbances of children under the same policy terms and conditions applied to other medical conditions.

Impact. As a result of AB 1100, those with severe biologically based mental illnesses and children with serious emotional disturbances would likely obtain improved access to mental health services, since their conditions would be subject to the same policy coverage as other physical illnesses. These enrollees would be likely to use more mental health services which, in turn, would lead to increased costs for the health plans.

We estimate the increase in premiums resulting from these increased costs would be approximately 2.1 percent for all plan types in California. Specifically, we estimate that there would be a 1.0 percent premium increase for HMOs, 2.7 percent increase for PPOs/POSs, and 3.6 percent increase for fee-for-service plans.

This bill would also increase the market share for managed care plans since those plans would have lower increases in premiums than traditional fee-for-service plans. Furthermore, since HMOs, particularly group models, are good at managing care, enrollees may not experience as significant an increase in access to mental health services as those in fee-for-service plans. The effects of parity would fall more strongly on fee-for-service plans which use the limits on services to control costs instead of case management techniques which are the mainstay of managed care. For that reason, the mental health parity legislation would tend to increase enrollment in HMOs.

Direct Access to Obstetrical and Gynecological Services

Background and Legislation. As with care from other specialists, many HMOs require that a woman have a referral from her primary care physician to see an obstetrician and gynecologist. However, many have argued that women should have direct access to obstetricians and gynecologists who, in many situations, are viewed as primary care physicians. Legislation providing some form of such access has been passed in many states. In 1994, California enacted legislation enabling women to choose an obstetrician and gynecologist as their primary care physician. In 1997, the Assembly and the Senate in California passed legislation (AB 1354) that would have required health plans to provide women with direct access to obstetrical and gynecological services, but that bill was vetoed by the Governor.

Impact. Given that women in California could already choose obstetricians and gynecologists as their primary care physicians, we estimate that AB 1354 would result in slightly higher premiums and out-of-pocket costs for HMO enrollees, approximately a 0.35 percent increase.

At the same time, enrollees would benefit from easier access to obstetrical and gynecological services and, in some circumstances, would benefit from improved quality of care. We expect similar impacts on both IPA model and group model HMOs. However, this type of legislation could have a longer-term impact on managed care that would be much larger in magnitude, if it sets in motion other legislation that would hinder the ability of managed care plans to limit access to specialists other than obstetricians and gynecologists.

Lengths of Stay for Mastectomy Patients

Background and Legislation. Since the 1996 passage of federal legislation mandating lengths of stay for maternity visits, mandating lengths of stay for mastectomies has become a common area for managed care legislation. In response to increased outpatient surgeries and decreased inpatient lengths of stays for mastectomies, legislation mandating minimum hospital stays has been introduced at both state and federal levels. In 1997, the California legislature considered bills that would mandate that the hospital length of stay for mastectomies be determined by the physician in consultation with the patient and those that mandate a 48-hour minimum stay.

Impact. We estimate that if a 48-hour minimum stay for mastectomies were enacted, the mean length of hospital stay for mastectomies would increase by 11 percent, from 2.0 days to 2.2 days. This estimation is based on the assumption that 25 percent of the short-stay patients-those who would have previously stayed less than 48 hours-elect to stay the full 48 hours if this legislation is enacted. In terms of an increase in health plan premiums, we estimate that the 48-hour minimum stay would result in only a one-hundredth of a percent (0.01%) increase in premiums, for both IPA model and group model HMOs. We would expect a similar increase in California and nationwide.

Conclusion

Based on our analyses, we were able to draw several conclusions which we hope will provide a starting point for further analyses of these proposals as well as other proposals that would regulate this industry.

First, proposals for managed care reforms improve some aspect of medical care or access to services for enrollees in managed care plans. Every proposal that we considered would, to some extent, force HMOs to offer more and/or better services to enrollees.

Second, proposals for managed care reforms tend to increase health plan costs and raise premiums. More services implies higher benefit costs for health plans. The plans, in turn, pass the costs along in the form of higher premiums. We estimate only small premium increases as a result of specific pieces of managed care legislation. However, if a large proportion of current managed care legislation were enacted, then the impact might be very large premium increases accompanied by a large shift in enrollment to fee-for-service plans. The impact of legislation, however, would likely vary according to type of HMO.

Finally, the impact of state managed care legislation could be severely limited by ERISA which enables self-insured plans to avoid compliance with state legislation. Furthermore, under ERISA, both self-insured and non-self-insured plans can avoid the attempts of states to expand insurer liability. In order to ensure that reforms affect all health plans, legislation would have to be passed at the federal level.

* * *The Impact of Managed Care Legislation: An Analysis of Five Legislative Proposals from California

Managed Care Plan Liability: An Analysis Of Texas And Missouri Legislation

Is There A Managed Care “Backlash?”

Embargoed for release: 9:30 a.m. ET, Wednesday, November 5, 1997

For further information contact: Matt James or Tina Hoff

Most Americans Give Their Own Health Plan A Good Grade, But Have Concerns About Key Aspects Of Managed Care

Washington, DC — At a time of expanding enrollment and stricter federal and state regulation, how does the public feel about managed care? Most insured Americans — regardless of whether they have managed care or traditional coverage — give their own health plan a letter grade of “B” or higher. However, majorities of the public also say they are concerned about key aspects of managed health care. According to a new national survey by the Kaiser Family Foundation and Harvard University:

• A majority of Americans (59%) say managed care plans have made it harder for people who are sick to see medical specialists (25% say easier);
• Half (51%) say managed care has decreased the quality of care for people who are sick (32% say increased);
• Three out of five (61%) say managed care has reduced the amount of time doctors spend with patients (16% say increased);
• A majority of people in managed care — 55 percent — say they are at least “somewhat worried” that if they were sick their “health plan would be more concerned about saving money than about what is the best medical treatment;” 34 percent of those with traditional health insurance coverage feel this way.

One area where managed care does come out on top is preventive care: nearly half (46%) of people say managed care has made it easier to get services such as immunizations, health screenings, and physical exams (31% say harder).

The survey also found that people seem to generalize from anecdotal reports in the news about problems with managed care. When asked about specific examples taken from news stories about the problems some people have reported to have had with managed care, the public’s perception is that these are fairly common occurrences. For example, two thirds of Americans believe that a Health Maintenance Organization (HMO) holding back on a child’s cancer treatment is something that happens “often” (26%) or “sometimes” (40%). Two out of five (39%) think newborn babies being sent home after just one day because of a managed care plan’s policy, in spite of mothers’ concerns, happens “often;” an additional third (34%) think this occurs at least “sometimes.”

“Managed care is winning in the health care marketplace, but it is in danger of losing the battle for public opinion,” said Drew E. Altman, Ph.D., President, Kaiser Family Foundation.

More people — 34 percent — think managed care health plans do a “good job” in serving health care consumers than think do a “bad job” (21%). However, overall, other health care groups are viewed far more favorably than managed care health plans: solid majorities of Americans think nurses (83%), doctors (69%), hospitals (61%), and pharmaceutical companies (62%) generally do a “good job.” For many people, though, the jury is simply still out: 32 percent have no opinion about the kind of job managed care health plans are doing.

Who Benefits from Managed Care Savings?

Many people perceive the cost savings from managed care as benefiting both employers (56%) and individuals (49%), but it is the health insurance companies themselves that most (72%) say reap the rewards in the form of greater profits. Few Americans believe the trend to managed care has had a significant impact on the overall cost of health care in this country, with most — 55 percent — saying they don’t see that it has made much of a difference; 28 percent say it has helped bring down costs.

Should Managed Care Be Regulated?

In recent weeks, the push for regulation of managed care has intensified with some industry leaders now calling for “legally enforceable national standards.” The President’s Advisory Committee on Consumer Protection and Quality in the Health Care Industry is also expected to soon release a “consumer bill of rights.” A slight majority of Americans — 52 percent — say the government should protect consumers of managed care; 40 percent say such intervention is not worth the increased costs that would result. When asked who they would “most like to see managed care plans regulated by,” the public is divided over whether the government — federal (19%) or state (18%) — or an independent organization (34%) should regulate the industry. Sixteen percent (16%) maintain that managed care plans should not be regulated at all.

Managed … What?

Few Americans are familiar with some of the key terms used in debates over health care policy. A sizeable percentage of people — 28 percent — have never heard of “managed care” (45% know what it means; 26% have heard of it but are not sure what it means). “Fee-for-service” is even less recognized: while 41 percent say they know what it means, 43 percent say they have never heard the term (15% have heard of it but are not sure what it means). HMOs are more familiar: 62 percent say they know what it means (24% have heard of but are not sure what it means, and 14% have never heard the term).

Comparing the Views of Managed Care Enrollees with People in Traditional Health Plans

People in managed care are more worried than those with traditional coverage when it comes to the perceived motivations of their health plans. Insured respondents under 65 in this survey were grouped into three categories based on their health care coverage: “heavy” managed care, reflecting the most restrictive arrangements; “light” managed care, reflecting less restrictive arrangements; and “traditional” fee-for-service plans. Three out of five people (61%) in “heavy” managed care say they would be at least “somewhat worried” that their health plan would be more concerned about saving money than providing the best treatment option if they were sick. Fifty-one percent (51%) of those in “light” managed care agree. By comparison, 34 percent of those with traditional coverage report a similar anxiety; 62 percent say they would not be overly worried that cost might affect medical care.

“People in managed care are much more anxious than those in traditional plans about whether or not their insurance plan will pay for what they need when they are sick,” said Robert J. Blendon, Sc.D., Professor of Health Policy at Harvard University. “Members appear satisfied with their plans today, but are concerned about what might happen to them in the future.”

While most insured Americans say they trust their health plan to do the right thing at least “most of the time,” those in traditional health plans have a greater degree of confidence than those in managed care that this is “just about always” the case (55% in traditional plans vs. 30% in “heavy” and 31% in “light” managed care).

Managed care enrollees are more likely to have cost concerns than those in traditional fee-for-service plans. While 69 percent of people in traditional health insurance say they think it would be “very likely” that their plan would cover most of the cost of serious illness, by comparison 44 percent of those in “heavy” and 54% in “light” managed care are equally sure their plan would pay. Similarly, three quarters (78%) of those with a traditional plan say it is “very likely” that a visit to the emergency room would be covered, while fewer of those in managed care (56% in “heavy” and 63% in “light”) are as confident their plan would pay.

While managed care enrollees appear more anxious about their health plan than those with traditional health care coverage, people with all types of insurance coverage grade their plans generally favorably. Twenty percent (20%) of those with “heavy” managed care give their plan a letter grade of “A,” 44 percent give a “B;” about the same percentages given by those with “light” managed care (“A” 24%, and “B” 44%). Slightly more people with traditional health insurance give an “A” (33%), and 43 percent give a “B.”

How Type of Health Care Coverage was Determined.

Because many people are unsure — or don’t know — what kind of health insurance they have, insured respondents under 65 in this survey (778 respondents) were asked a series of questions about their health plan to establish what kind of coverage they have. They were asked if they were required to do any of the following by their plan: choose doctors from a list and pay more for doctors not on the list; select a primary care doctor or medical group; and/or obtain a referral before seeing a medical specialist or a doctor outside of the plan. Respondents were listed as being in “heavy” managed care if they reported their plans had all of the characteristics described above (34% of the sample). Respondents were listed as being in “light” managed care if they reported their plans had some but not all of the characteristics listed above (45% of the sample). And, respondents were listed as having “traditional” insurance if they reported their plans as having none of the characteristics (21% of the sample).

Shaping Public Opinion: Personal Experience, Family, Friends, and the Media

People say that their feelings about managed care — favorable as well as unfavorable — are more likely to be based on personal experiences and what they have heard from family members and friends than on media coverage. Two thirds of those who say they think managed care plans generally do a “bad job” serving consumers report that the main reason they feel this way is their own experience (39%) or what they have heard from family or friends (32%). Similar percentages of people who think managed care is doing a “good job” say the same thing (35% say own experience, 32% say family or friends). About a quarter say media coverage of managed care has most influenced their views. Those with unfavorable impressions of managed care are again as likely to cite the media (22%) as those with more favorable opinions (24%).

Media coverage of HMOs or managed care is largely seen by the public as “fair” (54%) and as including a mix of favorable and unfavorable stories (57%). Most people — 56 percent — say they have personally seen at least “some” media coverage about managed care in the past year.

Methodology

The Kaiser/Harvard National Survey of Americans’ Views on Managed Care is a product of the Kaiser-Harvard Program on the Public and Health/Social Policy. It was designed and analyzed by researchers at the Kaiser Family Foundation and Harvard University. The survey was conducted by telephone by Princeton Survey Research Associates with 1,204 adults nationwide between August 22 and September 23, 1997. The margin of error is plus or minus 3 percent for the national sample.

The Kaiser Family Foundation, based in Menlo Park, California, is a non-profit, independent national health care philanthropy and is not associated with Kaiser Permanente or Kaiser Industries. The Foundation’s work is focused on four main areas: health policy, reproductive health, and HIV policy in the United States, and health and development in South Africa.

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National Election Night Survey of VotersPress Release Survey Chart Pack

3. The Affiliation Process and the Role of Reproductive Health Services in the case studies

The four case studies conducted for this project provide insight into the affiliation process between Catholic and non-Catholic health care providers and the role of reproductive health services in the process. The four successfully negotiated affiliations studied included an acquisition, a merger, a consolidation, and a 50/50 joint venture. (See Figure 1 for a summary of the contextual, organizational, and affiliation attributes of the four case studies, and Appendix C for the case study reports.) In case A, a non-sectarian not-for-profit hospital that was part of a large not-for-profit system acquired a financially stressed Catholic hospital of smaller size, which now operates as a non-sectarian hospital. In case B, a large academic medical center merged with a small, financially stressed Catholic hospital a few miles away as part of a strategy to form a non-sectarian integrated delivery system. In case C, a consolidation between two competing religious hospitals of similar size – one Catholic, one Protestant – formed a non-sectarian not-for-profit medical center. In case D, a 50/50 joint venture occurred between a large regional Catholic hospital system and a medium-sized, financially stressed public/district hospital, which did not assume a Catholic identity following the affiliation. None of the cases involved a non-sectarian organization adopting Catholic identity or agreeing to abide by the Directives.

A. Factors Motivating the Case Study Affiliations

The case studies illustrate that the prominence of market forces, including threats to financial viability, was a key factor driving organizations with disparate values and missions (including different religious traditions) to seek to accomodate their different commitments in affiliation agreements. A number of important factors motivating affiliations between Catholic and non-Catholic providers were identified. Key informants in all sites reported that a variety of market factors motivated the decision to affiliate, and they articulated these motivations in terms of improved access to capital, reduced duplication of services, economies of scale, and greater market power. In two cases, the survival of the Catholic partner was at stake due to financial problems.

In general, cases B, C, and D reported that the actual or anticipated increase in managed care penetration in local markets was an important factor motivating the decision to affiliate. All three of these cases also cited the impending financial challenges posed by the shift toward capitated payments for health care services under managed care arrangements as an important factor. The partners to the affiliation in case A, however, did not report that the growth of managed care was a primary motivator. In that case, the most important motivator for the Catholic provider was the need to ensure the survival of the Catholic hospital; the non-Catholic hospital, on the other hand, was primarily motivated to affiliate by the need to increase its market share.

In addition to case A, hospital survival was an important motivator in cases B and D. Both the Catholic facility in case B and the district hospital in case D were struggling financially due to a declining census and operating inefficiencies. The hospitals had begun to close clinical departments and lay off staff in an attempt to reduce their deficits. Concern about possible closures and the consequent loss of inpatient and emergency services to the surrounding communities prompted the hospitals to seek affiliation.

As in case A, case B informants reported that the goal of increasing market share was an important factor motivating the decision to affiliate. In case A, the non-Catholic hospital had established a number of ambulatory care sites (primary care centers) in surrounding communities that provided referrals to the hospital. One center was actually opened in the Catholic hospital’s service area. Acquiring the Catholic facility was therefore part of a larger strategy to strengthen the non-Catholic hospital’s position as a major provider. As for case B, the merger of the two hospitals was part of a larger integration that involved a medical school and a physician group practice, with the goal of forming the only integrated system in the area.

B.The Role of Reproductive Health Services Issues in the Affiliation Process

The case studies illustrate that ethical and religious concerns about reproductive health services are important issues in affiliations between Catholic and non-Catholic providers, that the abortion issue has the potential to derail affiliations, and that there are various strategies for dealing with reproductive issues in the affiliation negotiation process. The historical context of affiliation agreements, the financial status of the Catholic party, the pre-affiliation status of reproductive services in the affiliating organizations, and the community context were all factors that affected the role of reproductive health services in the affiliation process. We found no simple relationship between the type of affiliation and the nature of decisions about reproductive health services. There is evidence in all cases that both theological considerations and market forces affected how affiliations were negotiated and how reproductive issues played out.

Theological considerations necessarily inform affiliation arrangements involving Catholic health care facilities. Although the document specifically guiding the provision of health care in Catholic institutions is the Directives, this document presupposes an earlier statement by the United States Catholic Bishops (NCCB 1981). In these documents, the Bishops identify the dignity of the human person, the biblical mandate to care for the poor, contribution to the common good, the responsible stewardship of resources, and conscience as the normative principles that inform the church’s healing ministry. These principles not only support the church’s position on reproductive services, but also its position on humane care for the dying and the proscription of euthanasia. More broadly, these principles support the church’s commitment to social justice, which entails the view that health care is a fundamental right of all persons and that Catholic health care should distinguish itself by service to, and advocacy for, the poor and vulnerable. Social justice and concern for the common good entail that limited health care resources be used wisely and that employees in Catholic facilities be treated with respect and justice. It is therefore important to note that theological considerations not related to reproductive health services also may be explicitly introduced in affiliation arrangements.

In two of the case studies (A and C), earlier attempts at affiliation had failed because of differences over abortion, and this historical context provided the basis for strategies to deal with proscribed services in the second, ultimately completed, affiliation attempts. In case A, the first affiliation attempt (a proposed merger) in the early 1990s was abandoned because the system under which the non-Catholic hospital operated provided abortions at one of its other hospitals. The Catholic hospital believed that the Directives prohibited a merger under these circumstances. By the mid-1990s, however, the financial instability of the Catholic hospital was such that it could no longer survive as an independent provider. The decision by the Catholic hospital’s governing board to sell its facility to the non-Catholic hospital (rather than to merge) was driven by the need to avoid conflict over the provision of abortion that emerged during the first attempt. The board decided that the continuation of hospital services to the community took precedence over maintaining a Catholic presence. As part of the acquisition agreement, the Catholic facility would no longer retain its identity as Catholic and, accordingly, would cease to operate under the Directives. However, the non-Catholic hospital agreed in writing that no “life-terminating procedures” – including abortion, euthanasia, or assisted suicide – would be provided on the former Catholic campus.

In case C, an earlier affiliation attempt had been made in the 1970s; over a three-year period, the two hospital governing boards pursued plans for a merger, but it was only at the end of this period that the plans were communicated to the public (which then protested the merger, largely on the basis of anti-abortion sentiments) and to the religious order overseeing the Catholic hospital. Given that the Protestant hospital provided abortions, the Catholic Diocese could not authorize merger, and the affiliations plans were abandoned at considerable cost to both parties. Because of the role that abortion had played in defeating the earlier affiliation attempt, the decision was made in the 1990s to defer the abortion question to the governing board of the post-consolidation, non-sectarian medical center. Members of the two existing governing boards felt strongly that, for the benefit of the community, religious ideology should not be allowed to derail the consolidation. Contraceptive and sterilization services were not an issue for the governing boards in the affiliation process because these services had been provided at both institutions prior to affiliation. After consolidation, the new governing board voted to discontinue abortions (except to save the life of the woman) at the former Protestant hospital. This decision was supported by vocal segments of the community.

In case B, the prospects for survival of the Catholic hospital and the pre-affiliation status of reproductive services in the partnering hospitals were the key factors that shaped the role of reproductive services in the affiliation process. The merger in case B was the first affiliation attempt between the parties. In this case, the CEO of the Catholic hospital, the local Bishop, and the order of Sisters sponsoring the Catholic hospital recognized that marketplace changes and a declining census threatened the survival of the 83-bed hospital, which provided no obstetrical or related services. In addition, they recognized that increased competition between their hospital and the nearby academic medical center represented poor stewardship of community resources. The governing board of the Catholic hospital agreed that the alleviation of financial pressures and the means of responsible stewardship lay in a merger agreement with the academic medical center to form a new, non-sectarian, not-for-profit integrated delivery system. As part of the merger agreement, it was decided that the former Catholic campus would continue to operate under the Directives; in effect, this meant that no services in conflict with Catholic values would be offered on that campus. The Directives, however, would not apply on the medical center campus, where obstetrical, gynecological, contraceptive, sterilization, and infertility workups and treatments would continue to be provided. Because the medical center would continue its practice of providing only medically indicated second-trimester abortions, rather than elective abortions, the Bishop supported the merger agreement.

In case D, the community context shaped the role that reproductive health services played in the affiliation process. At the early stages of negotiation between the district hospital and the Catholic system, reproductive issues were a lightening rod for opposition by local reproductive rights groups, hospital physicians, and community members who feared that partnership with a Catholic health system would mean a loss of reproductive services in the district hospital. Through a series of public meetings, representatives of the Catholic system and of the district hospital governing board made it clear that under the conditions of the 50/50 joint venture, the district hospital would not assume a Catholic identity and would not operate under the Directives. With the exception of abortion services, which were readily available at neighboring hospitals and clinics and which had rarely been provided at the district hospital, all other reproductive services would continue to be offered at the district hospital following the affiliation.

A key element in the affiliation process in case D was the articulation of common values in a document that became part of the affiliation contract. Developed by Catholic system ethicists, the diocesian Bishop, and the Catholic system legal counsel, the document outlined the values of the Catholic health care ministry that should be shared by the parties (i.e. social justice, the promotion of human dignity, and responsible stewardship of resources). The document also states that direct abortion and assisted suicide will not be permitted in affiliating hospitals. Because terminations of pregnancy to save the life of the woman are not considered “direct” abortions, they would be permitted at the district hospital under the terms of the joint venture.

All cases therefore developed explicit strategies for dealing with religious values and controversial reproductive health services early in the negotiation process. These strategies included decisions about the type of affiliation, the future Catholic identity (if any) of the partners, and the future role of the Directives in guiding service delivery. Although theological considerations influenced decisions regarding reproductive services, concerns about social justice and responsible stewardship of resources also played prominent roles in affiliation agreements.

C.Factors in Successfully Negotiated Affiliations

Several key factors to successfully negotiating an affiliation agreement between Catholic and non-Catholic providers were identified. The first, as noted above, is the early formulation of a strategy for dealing with religious values and controversial reproductive health services, particularly abortion, within the context of affiliation agreements.

In addition, strategies to inform and involve the community throughout the affiliation process were employed in all four cases. Hospital publications explaining the need to affiliate and the process of affiliation were distributed internally and externally to keep the community informed. Hotlines were established to respond to questions and concerns. In cases A and D, open forums were held to allow community members to express their concerns about the proposed affiliation. In case D, this approach was particularly valuable for ensuring that the abortion issue was addressed early and openly. Additional efforts to ensure community involvement included holding public ceremonies to “mark the death” of the former Catholic hospital (when Catholic identity was relinquished) and soliciting input from community members in naming newly formed organizations. These strategies were considered critical in cases A, B and C, in which the affiliations resulted in the loss of identity of the two Catholic hospitals and the creation of a single, new organizational identity.

Other strategies employed to ensure a successful affiliation focused on managing the affiliation process itself. Outside consultants were hired to help board members, religious leaders, and senior executives come to an agreement about how religious issues would be addressed. Consultants were also hired to facilitate the development of strategies and implementation plans or to assist in the process of obtaining approvals for an affiliation from the Department of Justice.

The strategy employed in case C to facilitate the Department of Justice review process was carefully thought out and executed. A steering committee was organized to oversee the process, and an outside consultant with expertise in managing merger approvals was hired. The partners to the consolidation recognized from other organizations’ failed attempts to affiliate that poor planning could result in a denial from the Department of Justice. The partners to the affiliation in this case were particularly sensitive to these issues, given that they stood to gain 80% of the hospital market share.

In addition to using consultants, careful management of how the affiliations were operationalized was critical to a smooth integration process. Typically, an integration team representing the partners’ senior executives, clinicians, and administrative personnel was assembled to oversee the transition. Workgroups to address the different operational areas were also formed to align services between campuses and to review policies and procedures. Top administrators for the affiliated institutions were selected early, and their responsibilities and performance expectations were defined. Particular attention to human resources issues was identified as critical, in part because of the need to bridge cultural differences stemming from different religious traditions or service ideologies in the affiliating organizations.

The models for structuring governance arrangements that were employed in cases B, C, and D facilitated the integration of the partners to the affiliations. In case B, for example, a new integrated delivery system was formed. Each of the four partners to the integration maintained a separate governing board and had equal representation on a fifth board overseeing the system. Despite the small size of the board of the Catholic facility, its retained powers in the affiliation agreement ensured strong representation within the integrated delivery system. In case C, a single board for the new medical center was established, with equal representation from the two partners as well as community representation. A new corporation was formed to run the district hospital in case D; its board equally represents the Catholic system and the district hospital. The hospital also retained its own elected board, primarily to oversee the use of funds contributed by the Catholic system as part of the affiliation agreement.

Finally, key informants reported that gaining physician support for the proposed affiliations was a critical factor for successfully completing the affiliations. In case B, for example, physician involvement was solicited throughout the process by promoting a leadership role for physicians in managing consolidated clinical service lines. In case D, the strategy to promote physician involvement was to organize members of the district hospital’s medical staff into a committee to evaluate the quality of medical care provided by the Catholic and for-profit health systems competing to affiliate with the hospital.

D.Post-Affiliation Challenges

Affiliations are long-term processes that do not end when a formal agreement is negotiated. Although our site visits were conducted early in the post-affiliation phase of organizational development, it is important to note that ongoing challenges to completing integration activities were identified in all four cases.One of the most important challenges that emerged in all of the cases was completing the process of merging disparate organizational cultures. The human resources issues that are involved in merging cultures were compounded by religious vs. non-sectarian orientations of the partners, by workforce reductions, and by changes in the models of clinical care delivery (e.g. from departments to multidisciplinary service lines). In case B, in particular, cultural integration emerged as one of the most important issues. Key informants reported that management had failed to consider the impact of the merger on staff productivity and morale. Failure to plan for the cultural change process has led to the publication of an underground newsletter and a disgruntled management team.Although there were similar challenges of managing the cultural change process, the cases differed in their identification of challenges to the future of their partnerships. Cases B and D were still struggling with internal integration challenges. In case B, informants reported that an important challenge is finding strategies to help build physician management skills. This emerged as an important skill deficit among physicians during clinical department consolidation activities. In case D, key informants reported that workforce reductions and managing disagreements between unionized labor and management were the key challenges.Both cases A and C were focused on the challenges that lie ahead, now that basic integration strategies have been completed. In case A, informants reported that the most pressing needs are developing strategies for growth in new markets and for streamlining existing services. Case C informants also identified outcomes-focused challenges and the need to become more responsive to women’s health care needs in the communities served by the new medical center. Return to top

Is There a Common Ground? Affiliations Between Catholic and Non-Catholic Health Care Providers and the Availability of Reproductive Health Services

Table of Contents, Acknowledgements, Executive Summary1. Introduction2. Trends in Affiliations Involving Catholic Providers3. The Affiliation Process and the Role of Reproductive Health Services in the Case Studies4. The Outcomes of Affiliations in the Case Studies5. Conclusions and Policy ImplicationsFigures Tables ReferencesAppendix A Appendix B Appendix C

Summary

An Annotated Bibliography of Sentinel Articles

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