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David U. Himmelstein, MD; Steffie Woolhandler, MD, MPH; Ida Hellander, MD; Sidney M. Wolfe, MD

JAMA. 1999;282:159-163.

Context  The proportion of health maintenance organization (HMO) members enrolled in investor-owned plans has increased sharply, yet little is known about the quality of these plans compared with not-for-profit HMOs.

Objective  To compare quality-of-care measures for investor-owned and not-for-profit HMOs.

Design, Setting, and Participants  Analysis of the Health Plan Employer Data and Information Set (HEDIS) Version 3.0 from the National Committee for Quality Assurance's Quality Compass 1997, which included 1996 quality-of-care data for 329 HMO plans (248 investor-owned and 81 not-for-profit), representing 56% of the total HMO enrollment in the United States.

Main Outcome Measures  Rates for 14 HEDIS quality-of-care indicators.

Results  Compared with not-for-profit HMOs, investor-owned plans had lower rates for all 14 quality-of-care indicators. Among patients discharged from the hospital after myocardial infarction, 59.2% of members in investor-owned HMOs vs 70.6% in not-for-profit plans received a -blocker (P<.001); 35.1% of patients with diabetes mellitus in investor-owned plans vs 47.9% in not-for-profit plans had annual eye examinations (P<.001). Investor-owned plans had lower rates than not-for-profit plans of immunization (63.9% vs 72.3%; P<.001), mammography (69.4% vs 75.1%; P<.001), Papanicolaou tests (69.2% vs 77.1%; P<.001), and psychiatric hospitalization (70.5% vs 77.1%; P<.001). Quality scores were highest for staff- and group-model HMOs. In multivariate analyses, investor ownership was consistently associated with lower quality after controlling for model type, geographic region, and the method each HMO used to collect data.

Conclusions  Investor-owned HMOs deliver lower quality of care than not-for-profit plans.

Author Affiliations: Department of Medicine, Center for National Health Program Studies, Cambridge Hospital/Harvard Medical School, Cambridge, Mass (Drs Himmelstein and Woolhandler); Physicians for a National Health Program, Chicago, Ill (Dr Hellander); and Public Citizen Health Research Group, Washington, DC (Dr Wolfe).

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