January 2003

Grant Results

SUMMARY

From 1998 to 2000, researchers at the Johns Hopkins University, Bloomberg School of Public Health studied Elder Health, a for-profit managed-care provider in Baltimore, Md., that serves individuals eligible for both Medicare and Medicaid (i.e., dually eligible).

Key Findings
In journal articles in Health Care Financing Review and the Journal of the American Geriatrics Society, and in unpublished reports to RWJF, the investigators concluded that:

  • Elder Health offers a model of care that may be unique. Among its distinctive elements are that:
    • It is a for-profit organization that provides comprehensive care for a population of patients that typically uses a large quantity of health care resources.
    • It combines Medicare and Medicaid capitation payments at the health care provider level, thereby allowing discretion in how funds are spent.
    • Each Elder Health patient is assigned a nurse practitioner functioning as a case manager who integrates medical care and social services as needed, and a nurse practitioner who is available on-call 24 hours a day, 7 days a week.
  • Elder Health patients appeared to experience equal or better health outcomes than do those in a matched sample of older adults in the fee-for-service sector.
  • Elder Health patients expressed greater satisfaction with their access to care and receive more primary care and preventive services at comparable cost.

Funding
The Robert Wood Johnson Foundation (RWJF) supported this project through a grant of $352,436.

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THE PROJECT

Those who are eligible for both Medicare and Medicaid (termed dually eligible) account for about 28 percent of Medicare expenditures and 35 percent of Medicaid expenditures. Government payers at both the federal and state levels have a strong interest in knowing whether managed care can offer these older, dually eligible individuals health care that is both satisfactory for the patient and cost-effective.

This grant from RWJF to the Johns Hopkins University Bloomberg School of Public Health supported a study of Elder Health, Inc., a for-profit managed-care provider in Baltimore, Md., that serves primarily older, dually eligible individuals.

Elder Health was founded in 1995 to offer comprehensive geriatric health care emphasizing preventive services and case management by nurse practitioners. Elder Health takes responsibility for all health care services covered by Medicare and most of those covered by Medicaid. In exchange, it receives a fixed, or capitated, monthly payment for each patient enrolled in the plan.

The overall goals of the project were to:

  1. Describe how Elder Health organizes and delivers health care.
  2. Evaluate patients' satisfaction and health status as a result of that care.
  3. Compare the cost of providing that care with the costs of traditional fee-for-service Medicare and Medicaid.

A nine-member Advisory Committee established guidelines for the design of the study. (See the Appendix.)

At the time of the study, Elder Health had two health clinics that incorporated adult day care centers. Those facilities served about 400 people in approximately half of the ZIP codes of Baltimore. To develop a profile of how Elder Health organizes and delivers care, investigators in the study's first phase:

  1. Conducted interviews with administrative staff of Elder Health.
  2. Reviewed the medical records of 100 enrollees with complex case histories.
  3. Reviewed a variety of administrative data.

In the second phase, investigators conducted structured in-home interviews with 200 Elder Health patients and a year later conducted follow-up telephone interviews with 163 of them. The investigators then used a combination of self-reports and standard, validated instruments to assess patients':

  1. health, mental, and functional status
  2. use of hospitals and other medical services
  3. access to and satisfaction with their health care.

The responses of the Elder Health patients were compared with the responses of 201 older, dually eligible adults living in the same area and receiving fee-for-service medical care. A year later, 172 members of the fee-for-service sample group were re-interviewed by telephone. In addition, the investigators examined responses to similar questions by dually eligible patients who participated in the Medicare Current Beneficiary Survey, an ongoing national survey of Medicare users. Health care costs were derived from state Medicaid claims data.

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FINDINGS

In journal articles in Health Care Financing Review and the Journal of the American Geriatrics Society, and in unpublished reports to RWJF, the investigators concluded that:

  • Elder Health offers a model of care that may be unique. Among its distinctive elements are that:
    • It is a for-profit organization that provides comprehensive care for a population of patients that typically uses a large quantity of health care resources. It operates without government waivers by enrolling people on a voluntary basis.
    • It combines Medicare and Medicaid capitation payments at the health care provider level, thereby allowing discretion in how funds are spent. That has permitted Elder Health to, for example, use savings achieved in other areas to pay expenditures for preventive services and patient transportation beyond those covered by the Medicaid capitation rate. A fleet of Elder Health vans takes patients to many of those patients' medical visits.
    • Each Elder Health patient is assigned a nurse practitioner functioning as a case manager who integrates medical care and social services as needed. A nurse practitioner is available on-call 24 hours a day, 7 days a week. However, patients have a choice of more than 300 physicians — although five physicians see approximately 80 percent of the patients — and can make appointments with their primary care physician at any time.
  • Elder Health patients appear to experience equal or better health outcomes than a matched sample of older, dually eligible adults in fee-for-service care. Elder Health patients also express greater satisfaction with their access to care and receive more primary care and preventive services at comparable costs. Specifically:
    • Elder Health patients and the local fee-for-service patients reported similar levels of decline in their overall health status over one year, but the fee-for-service group reported poorer daily functioning.
    • Although similar proportions of Elder Health and fee-for-service patients were hospitalized during the year — 24.3 percent and 22.3 percent, respectively — the Elder Health patients spent less than half as many days in the hospital: 1,242 hospital-days per 1,000 patients for the Elder Health group compared with 2,740 per 1,000 patients in the fee-for-service group.
    • "The most salient finding is that dually eligible older beneficiaries can be highly satisfied with medical services in a managed care setting with the nurse practitioner model of primary care" (Health Care Financing Review). After one year, the Elder Health and fee-for-service patients reported similar levels of overall satisfaction with their health care, but a greater proportion of the Elder Health patients were highly satisfied with their access to care. The fee-for-service group, however, had a greater proportion of patients highly satisfied with information given by the provider. Both the Elder Health and fee-for-service groups had a higher proportion of patients highly satisfied with overall quality of care than did the national survey sample.
    • Elder Health patients had a higher combined rate of primary care visits than fee-for-service patients. Although Elder Health patients had fewer physician visits per year — mean 7.1 visits compared with 11.5 visits for fee-for-service patients — they also had 7.1 nurse practitioner visits, giving them 14.2 primary care visits overall per year compared to compared to 11.5 for the fee-for-service patients.
    • A larger proportion of Elder Health patients reported receiving preventive services, including mammograms, Pap smears, rectal exams, and flu shots than the fee-for service patients reported. The difference with the national survey sample was even more pronounced. For example, 75.5 percent of female Elder Health patients had a Pap smear in the past year compared with 47.5 percent of female fee-for-service patients and 21.1 percent of women in the national sample.
    • Medicaid costs were similar for Elder Health and local fee-for-service patients: $508 and $507 per member per month, respectively.

Limitations

The investigators cautioned that the study had several limitations, including:

  • The fact that the Elder Health patients made a decision to enroll in this managed care plan may have contributed to their satisfaction, since satisfaction may be highly related to freedom of choice. However, only three (1.5 percent) of the Elder Health enrollees who left the program during the year of the study cited "provider issues" as the reason — a figure that is lower than that observed nationally for those who leave managed care plans.
  • The patients studied were relatively small in number and predominantly African-American, and the setting was an inner city — factors that could limit the study's applicability to other patient populations.
  • The national survey data were collected two years before the local Elder Health and fee-for-service patient surveys were conducted. It is possible that changes in managed care at the national level may have occurred during that time interval, skewing the comparison of Elder Health satisfaction levels with those of patients in the national sample.

Communications

Articles about the study and its findings were published in Health Care Financing Review and the Journal of the American Geriatrics Society. (See the Bibliography for details.)

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AFTER THE GRANT

The principal investigator plans to study Medicaid data on costs associated with long-term care provided by Elder Health. She was seeking funding to support this work.

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GRANT DETAILS & CONTACT INFORMATION

Project

Evaluation of a Capitated Health Care System for Low-Income Elderly Baltimore Residents

Grantee

The Johns Hopkins University, Bloomberg School of Public Health (Baltimore,  MD)

  • Amount: $ 352,436
    Dates: January 1998 to September 2000
    ID#:  032370

Contact

Lynda C. Burton, Sc.D.
(410) 955-6568
lburton@jhsph.edu

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APPENDICES


Appendix 1

(Current as of the time of the grant; provided by the grantee organization; not verified by RWJF.)

Advisory Committee

Lynda Burton
Principal Investigator
Johns Hopkins University School of Public Health
Health Services Research and Development Center
Baltimore, Md.

David Carliner
Senior Vice President of Development
Elder Health, Inc.
Baltimore, Md.

William Clark
Office of Strategic Planning
Health Care Financing Administration
Baltimore, Md.

Pamela Dickson
Program Officer
Robert Wood Johnson Foundation
Princeton, N.J.

John Folkemer
Director of Health Services Analysis and Evaluation
Maryland State Department of Health and Mental Hygiene
Baltimore, Md.

Pearl German
Coinvestigator
Johns Hopkins University School of Public Health
Health Services Research and Development Center
Baltimore, Md.

Judith Kasper
Coinvestigator
Johns Hopkins University School of Public Health
Health Services Research and Development Center
Baltimore, Md.

Michael Nolin
Managed Care Coordinator
University of Maryland - Baltimore County
Center for Health Program Development and Management
Baltimore, Md.

Lewis G. Sandy
Executive Vice President
Robert Wood Johnson Foundation
Princeton, N.J.

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BIBLIOGRAPHY

(Current as of date of this report; as provided by grantee organization; not verified by RWJF; items not available from RWJF.)

Articles

Burton LC, Weiner JP, Folkemer J, Kasper J, German PS and Stevens GD. "Satisfaction with Health Care of Dually Eligible Older Beneficiaries." Health Care Financing Review, 22(4): 175–186, 2001. Abstract available online.

Burton LC, Weiner JP, Stevens GD and Kasper J. "Health Outcomes and Medicaid Costs for Frail Older Individuals: A Case Study of MCO versus Fee-for-Service Care." Journal of the American Geriatrics Society, 50(2): 382–388, 2002. Abstract available online.

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Report prepared by: Robert Crum
Reviewed by: Richard Camer
Reviewed by: Michael H. Brown
Program Officer: Pamela Dickson

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