Is health plan employer data and information set performance associated with withdrawal from medicare managed care?

Withdrawals of health plans from Medicare have affected more than 1.6 million beneficiaries. Some plans claim that providing higher quality care raises costs, lowers profits, and spurs withdrawal because plans cannot sustain high quality care under current payment levels. OBJECTIVE. To assess whether higher performance by Medicare health plans on quality indicators was associated with withdrawal. DESIGN. Retrospective cohort study. SUBJECTS. Taking each county where a contract was active as a unit of analysis, Medicare managed care plans active in 2310 contract-county combinations in 1997 were studied and followed for 3 years. MEASURES. Independent variables were scores on six indicators from the Health Plan Employer Data and Information Set (HEDIS) for each contract, collapsed into two summary measures: clinical and ambulatory care access. Separate Cox proportional hazards regressions were used for each indicator, and each summary measure, to assess the association of HEDIS performance with our outcome measure, time-to-withdrawal from Medicare. Multiple potential confounders were adjusted for. RESULTS. Of 2310 managed care contract-county combinations, 877 (38%) withdrew. The proportion of contract-counties with high scores on the summary clinical quality measure that withdrew was one-fifth that for low scorers (4.2% vs. 20.5%). For summary ambulatory care access performance, the corresponding ratio was two-fifths (12.8% vs. 32.0%). Lower payments were associated with higher withdrawal risk, but also higher clinical and ambulatory care access quality performance. In separate multivariable analyses controlling for confounders, both high clinical performance (HR, 0.18; 95% CI, 0.08-0.42) and high ambulatory care access performance (HR, 0.53; 95% CI, 0.27-1.07) were independently associated with lower withdrawal risk. CONCLUSIONS. Health plans continuing to provide care to Medicare beneficiaries have higher average performance on HEDIS clinical and ambulatory care access measures than plans that withdrew.