Department of Finance
Date of this Version
1994
Document Type
Article
Citation
Journal of Actuarial Practice 2 (1994), pp. 171-196
Abstract
As the trend to provide health care through managed care facilities increases, the need to examine ,vhy insured individuals voluntarily terminate managed care coverage grows. Voluntary termination of coverage, or dis enrollment, has both social and fiscal implications. Particularly among the elderly, patterns of disenrollment likely are related to self assessment of care needs and levels of health. In this paper we examine the patterns of dis enrollment among elderly enrollees as a function of health status and disability. We focus on disenrollment patterns from an experimental prepaid extended care facility, called a social HMO (S/HMO) and compare this pattern with dis enrollment within a sample of HMO enrollees and with a fee for service sample. The analysis is based on a frailty index defined using a fuzzy set model. The results indicate that bias in the enrollment process is exacerbated by disenrollment patterns that depend on the level of frailty and disability. Those with a greater degree of disability and chronic illness tend to disenroll into the fee for service coverage. Healthier persons, on the other hand, have a lower likelihood of disenrollment. This suggests that managed care is not providing for the needs of the patients most in need of care.
Included in
Accounting Commons, Business Administration, Management, and Operations Commons, Corporate Finance Commons, Finance and Financial Management Commons, Insurance Commons, Management Sciences and Quantitative Methods Commons
Comments
Copyright 1994 Absalom Press