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Who Switches from Medigap to Medicare HMOs?


  • Thomas Rice,

  • Rani E. Snyder,

  • Gerald Kominski,

  • Nadereh Pourat

This research was supported by a grant from the Commonwealth Fund. We would like to thank our project officer, Susan Raetzman, for her advice and support throughout the project. We would also like to express our appreciation to Terry Nakazono, who is from the UCLA School of Public Health, for his excellent programming and data system support. We also are grateful to two anonymous reviewers and the editors for their helpful suggestions.

Address correspondence to Thomas Rice, Ph.D., Professor and Vice-Chair, Department of Health Services, UCLA School of Public Health, Campus Box 951772, Los Angeles, CA 90095. Rani E. Snyder, M.P.A., is a Doctoral Student, Department of Health Services, UCLA School of Public Health, Los Angeles, CA. Gerald Kominski, Ph.D., is an Associate Professor, UCLA School of Public Health and Center for Health Policy Research, Los Angeles, CA. Nadereh Pourat, Ph.D., is an Adjunct Assistant Professor, UCLA Center for Health Policy Research, Los Angeles, CA. This article, submitted to Health Services Research on October 16, 2000, was revised and accepted for publication on January 19, 2001.


Objective. To determine the factors affecting whether Medigap owners switch to Medicare managed care plans.

Data Sources. The primary data were the 1993–1996 Medicare Current Beneficiary Survey (MCBS) Cost and Use Files. These were supplemented by data available from the Centers for Medicare & Medicaid Services (CMS) website.

Study Design. Individuals on the MCBS files with Medigap coverage in the period 1993–1996 were included in the study. The person-year was the unit of analysis. We used multivariate logistic regression analysis to determine whether or not a Medigap owner switched to a Medicare-managed care plan during a particular year. Independent variables included measures of affordability, need for services, health insurance benefits, sociodemographics, and supply of managed care plans.

Principal Findings. We did not detect strong evidence that beneficiaries in poorer health were more likely than others to switch from Medigap coverage to Medicare-managed care. In addition, higher Medigap premiums did not appear to induce beneficiaries to switch into managed care.

Conclusions. We examined selection bias in joining managed care plans among the subset of Medicare beneficiaries who have Medigap policies. No strong evidence of selection bias was found in this population. We conclude that there was no evidence that the Medigap market is becoming prohibitively expensive as a result of unfavorable selection.

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