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HSR&D 2004 National Meeting Abstracts

1019. Favorable HMO Selection Among Medicare Enrolled Veterans
Kristin A Koelling, MPH, HSR&D, Hines VA Hospital, MW Sohn, HSR&D, Hines VA Hospital, D Hynes, HSR&D, Hines VA Hospital, L Kok, HSR&D, Hines VA Hospital, N Arnold, HSR&D, Hines VA Hospital

Objectives: To investigate whether there has been favorable HMO selection among Medicare enrolled veterans aged 65 years old or older. Favorable HMO selection refers to the phenomenon that healthier individuals selectively join managed care programs more than those with poorer health.

Methods: We used the VA-Medicare linked data to identify veterans who newly enrolled in Medicare+Choice in 2000. Our sample consisted of veterans who were 65 years old or older in 1/1/1999 and were Medicare enrolled but did not participated in Medicare+Choice in any month in 1999. The Hierarchical Condition Categories (HCC) risk scores were the main measure of health status. Four risk groups were defined using the quartile values on the risk scores. Multiple logistic regression was used to model the odds of a veteran joining Medicare+Choice, controlling for individual, access, and market characteristics.

Results: There were 1.65 million Medicare enrolled veterans who did not participate in Medicare+Choice in 1999. About 16,000 (0.1%) enrolled in this program in 2000. Bivariate analysis show that only 0.78% in the highest risk group joined the program, compared with 1.27% in the lowest risk group (p<0.0001). Multiple logistic regression shows that veterans in the highest risk group were about 35% less likely to join the program than those in the lowest risk group (Odds Ratio=0.65, p<0.001).

Conclusions: Healthier veterans joined Medicare+Choice more, indicating favorable HMO selection among veterans. The proposed VA+Choice Medicare plan for Medicare eligible veterans needs to carefully consider how favorable HMO selection may affect this program.