New England Medical Center Analysis Shows No Difference in Health Outcomes Between Fee-for-Service Medicare and Medicare HMOs

In 2003 investigators at New England Medical Center Hospitals, Boston, collected four-year follow-up data from a cohort of Medicare beneficiaries under study since 1998 to examine differences in health outcomes related to physical and mental health and death for beneficiaries enrolled in traditional fee-for-service Medicare versus those enrolled in Medicare HMOs.

While many studies have examined performance differences between traditional fee-for-service Medicare and Medicare HMOs, results have been inconclusive.

Key Findings

Researchers reported findings in a December 2004 report to the federal Agency for Healthcare Research and Quality entitled Comparing Four-Year Health Outcomes Among Elderly Adults in Traditional (FFS) Medicare and Medicare HMOs.

  • There were no statistically significant differences in outcomes relating to physical and mental health or death after four years between elderly individuals enrolled in traditional fee-for-service Medicare and those enrolled in Medicare HMOs, after accounting for population differences.

  • Analysis of those who changed Medicare systems during the study period ("switchers") supported previous research findings that sicker patients are more likely to choose fee-for-service plans while healthier individuals tend to choose HMOs.

  • The addition of Medicaid coverage had a slight, but not statistically significant, favorable impact on physical health outcomes.