HMO plans, Self-selection, and Utilization of Health Care Services
- HMO plans, Self-selection, and Utilization of Health Care Services
- Shin, Jaeun; Moon, Sangho
- Issue Date
- Series/Report no.
- KDI Working Paper Series;04-23
- This study examines the effect of health maintenance organizations (HMOs) on the use of health care
services among the privately insured non-elderly population. Using data from the 2000 Medical
Expenditures Panel Survey, we find that HMO members are not particularly healthier than non-HMO
members. Still, endogenous health plan choice decisions cause attenuation bias in the utilization
performance of HMOs. After controlling selection bias, HMO enrollment increases the uses of officebased
services and hospital outpatient services. These findings imply that though HMOs in private
insurance market intend to contain utilization, they, in fact, provide consumer incentive to use more of
health care services.
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