< But medicare recipients are surely only a small portion of HMO's business-- or perhaps I do not understand the US situation. Isn't Medicare for the elderly in the US, and Medicaid for the poor? There is a huge market for medical care aside from the elderly. Probably most of the elderly would not opt for HMO's since they would face limits etc. and HMO's are not likely to want them either since they are expensive! So the fact that few Medicare recipients are in HMO's is not surprising and does not allow one to derive any conclusions about their future. Why not look at the total numbers from the whole population in HMO's over a period of years and see if it is increasing or decreasing and go on from there on the basis of analysing factors that might lead to decreases or increases?
CHeers, Ken Hanly
>
I don't think Medicare is a small part of HMO business. To quote from the primer:
Medicare is the single largest source of income for most providers
of medical services. It account for almost all of the revenue
received by home health care agencies, hospices, and kidney dialysis
facilities. It represents between 25 and 75 percent of the revenue
of clinics, laboratories, and ambulance services. And it accounts
for almost 40 percent of total hospital revenues, including payments
for patients, capital costs, and the education of medical students
and other personnel.
Medicare is big business.
But I don't have precise data (I'm just starting reading up). Also, many corporations are (or were) shoving their employees into HMOs, as their group health insurance. So, I have to consider employees too. But remember that the majority of employees are not insured.
For the time being, I'm sticking with my impression that HMOs are a small part of the medical industry.
HMOs are much bigger in Calif, the Pacific NW, Nevada and Arizona. So if you live in Calif or Washington State, you might conclude that HMOs are big. But in most states, HMOs are non-existent.
On another point, HMOs are desirous of Medicare recipients according to the primer. The reason is confusing to read at first, until you get it. The reason is, there is a natural adverse selection that makes Medicare recipients who volunteer for HMO more profitable for the HMO. Basically, people who choose HMOs are healthier and thus look to reduce out-of-pocket expenses. In other words, free prescriptions and low co-payments induce the healthier to chose HMOs over fee-for-service. The primer gives some reasons why the frailer chose to stick with fee-for-services.
It was discovered that HMOs were getting paid too much leading the Government to set per capitation limits, which in turn led to many HMOs quitting, claiming that the new rules kept them from making enough profit. Which is where we stand today. The quitting seems to have been arbitrary, meant to blackmail the government into concessions. (There's an HCFA paper on this that I haven't fully digested yet. Kaiser's operations in upstate NY and in Oregon were both unprofitable at the time, and both comparable in size and future prospects. Yet, Kaiser pulled out of upstate NY, and stayed in Oregon. The motive isn't clear, but the suspicion is blackmail).
All that being said, it is possible that I misunderstand what I read. I'm not a trained wonk. So, if you would volunteer to read the material with me so that I don't screw up too badly, I would really appreciate it.
-- John K. Taber