Impact of Membership in an Enrolled, Prepaid Population on Utilization of Health Services in a Group Practice

Abstract

Members of prepaid group-practice medical-care plans are believed to use more ambulatory, but fewer inpatient, services than populations served by fee-for-service practitioners. It is not known whether these differences are attributable to the prepayment aspects of the plan or to other circumstances. We studied the impact on use of services of only one factor-prepayment at the Marshfield Clinic, Wisconsin--with all other factors, including group practice, held constant. The findings were derived from the experience one year before, and two years after, the initiation of the prepaid program. Results showed that prepayment alone resulted in significant increases in both inpatient and ambulatory care (about 100 per cent in ambulatory-care visits, 75 per cent in hospital discharges, and 60 per cent in hospital days). These increases were far greater than comparable increases in the fee-for-service population served by the Clinic.