Enrollment choice in a mutli-HMO setting:the roles of health risk, financial vulnerability, and access to care

Abstract

Results of an analysis of enrollment decisions in HMO-type plans are reported. Previous studies concern dual-choice situations; this paper deals with a quadruple-choice situation involving one open- and two closed-panel HMO-type plans as well as Blue Cross/Blue Shield (BC/BS). The risk-vulnerability hypothesis is disaggregated into its components and the results show that there is no adverse health risk self-selection in an employed population. The hypothesis of economic vulnerability is maintained when tested in terms of per capita income rather than the previously used measure of family income. It is shown that those who enroll in any HMO-type plan are younger and have younger and larger families and lower per capita income than those who do not. No meaningful differences in terms of health status, health concerns, or prior utilization are found. Of the few differences found between those who enroll in closed- and open-panel HMO-type plans, having a private physician as the usual source of care is the most significant: those with an established physician relationship who join any HMO-type plan tend to follow their physician into the open-panel plan. The results should not be generalized to situations involving premium differences since the premium cost to subscribers in any of the plans considered here was fully paid by the employer. The validity of the results in terms of nonfinancial factors, on the other hand, is enhanced by the removal of cost considerations.