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Use of the Hospital in a Randomized Trial of Prepaid Care

Gordon Schiff, MD
JAMA. 1988;260(3):338. doi:10.1001/jama.1988.03410030054014.
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To the Editor.—  The most important finding from the article entitled "Use of the Hospital in a Randomized Trial of Prepaid Care"1 needs to be underscored, not buried or explained away. Health maintenance organizations (HMOs) reduced needed ("nondiscretionary") medical admissions by the same amount as they reduced "discretionary" admissions—a 56% reduction (from 34 vs 15 per 1000 person-years) in needed admissions compared with a 53% reduction (30 vs 14 per 1000 person-years) in admissions deemed less necessary.Thus, the study fails to find evidence that the HMO mechanism achieves its reductions in medical hospitalizations by effectively discriminating between needed and unnecessary admissions. Rather than selectively excising wasteful admissions, the instrument is apparently more of a sledgehammer than a careful surgical knife.For the surgical patients, there was a decrease in the rate of discretionary admissions, while the rate of more acute, nondiscretionary surgery did not decrease. The authors conclude that


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