Medicaid Managed Care - U.S. Senate Special Committee on Aging

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The extent of problems in reporting managed-care spending data is suggested by calculations of
spending per enrollee (Table 20-6). Among the states with at least 25 percent enrollment in all kinds
of managed care in 1994, several spent close to the national average of $877 per enrollee. But others
were well above that amount. Arizona's $2,515 per enrollee can be explained because Arizona funds its
system primarily through capitation payments, including spending for the more expensive elderly and
disabled beneficiaries (GAO 1995a). But other differences are harder to explain. 2 "
Table 20-6. <strong>Medicaid</strong> Spending on <strong>Managed</strong> <strong>Care</strong>, for States
Enrollment, 1994 (dollars)
with over 25 Percent
State, by Proportion of <strong>Managed</strong>-<strong>Care</strong>
Enrollment in Primary <strong>Care</strong> Case Spending on HMOs Spending
Management Arrangements (thousands) Per Enrollee
United States $6,803,637 $ 877
Over 75 Percent
Kentucky 36 0
Montana 270 6
New Mexico 0 0
North Dakota 66 2
Virginia 15 0
25 Percent to 75 Percent
Colorado 34,399 254
District of Columbia 37,661 884
Florida 544,374 1,106
Maryland 206,805 661
Massachusetts 347,622 729
Michigan 401,933 973
Pennsylvania 577,354 1,417
Utah 25,308 269
Less than 25 Percent
Arizona 884,459 2,515
Minnesota 175,386 1,505
Oregon 164,670 583
Tennessee 896,972 829
Washington 204,556 548
Wisconsin 186,959 1,504
SOURCE: Physician Payment Review Commission analysis of data from HCFA (1995) and Uska et al.
(1996).
NOTE: In calculating spending per enrollee, enrollees in dental and behavioral health plans were excluded.
' Two states, not shown in Table 20-6, are particular anomalies. Hawaii's estimated spending of $8,676 per enrollee
probably results from inaccurate counting of managed-care enrollment. Indiana reported $223 million spent on HMOs but no
managed-care enrollees. Indiana did report substantial managed-care enrollment in 1995, so the errer could be a discrepancy
in the timing of reporting of different types of data.
437 Physician Payment Review Commission