Melnick GA, Zwanziger J. State health care expenditures under competition and regulation, 1980 through 1991.
Am J Public Health 1995;
85:1391-6. [PMID:
7573623 PMCID:
PMC1615609 DOI:
10.2105/ajph.85.10.1391]
[Citation(s) in RCA: 33] [Impact Index Per Article: 1.1] [Reference Citation Analysis] [Abstract] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 01/26/2023]
Abstract
OBJECTIVES
This paper examines health expenditure growth under two alternative policy approaches: competition-based managed care and state government rate regulation.
METHODS
Data are presented on cumulative growth in real per capita health expenditures between 1980 and 1991 so as to compare California, a state with a pro-competitive policy, with the US average and with four states with established regulation programs.
RESULTS
Real per capita expenditures for hospital services in the United States grew 54% between 1980 and 1991, while in California the growth was half the national rate, or 27%. Real per capita expenditures for physician services and drug expenditures in the United States grew by 82% and 65%, respectively, while in California these expenditures increased only 58% and 41%, respectively. California's growth rate was below that of all four regulatory states for all measures of health care cost inflation.
CONCLUSIONS
On the basis of these findings, a properly structured competitive approach could play a significant role in controlling health expenditures in the United States.
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