NCPA - National Center for Policy Analysis

For-Profit Health Providers Don't Curb Access

January 8, 2004

For-profit health plans enrolling Medicare beneficiaries provide at least as much access to expensive medical procedures as do not-for-profit plans, according to a study in the New England Journal of Medicine. The study is surprising because researchers had surmised for-profits might deny pricey procedures.

The study's findings suggest that those who do won't get less care if they opt for a for-profit provider. They also indicate that for-profit providers might be less effective in controlling costs than some policy makers imagine.

Researchers pored over medical records of nearly four million Medicare recipients who in 1997 selected private plans for their coverage in lieu of the traditional benefit. For the 12 procedures they examined, including bypass surgery, hip replacement and prostatectomy, they found.

  • For-profit plans performed all 12 procedures more often than the not-for-profits.
  • The results still held up even after adjusting the data to account for the prevalence of surgery in different counties.

The Medicare-overhaul bill passed last month aims to push more seniors to choose private insurance plans -- either for-profit or not-for-profit -- instead of the traditional fee-for-service benefit.

Source: Charles Forelle, "For-Profit Medicare Plans Don't Curb Access to Care," Wall Street Journal, January 8, 2004; Eric C. Schneider, Alan M. Zaslavsky and Arnold M. Epstein, "Use of High-Cost Operative Procedures by Medicare Beneficiaries Enrolled in For-Profit and Not-for-Profit Health Plans," New England Journal of Medicine, January 8, 2004.


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