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Medical Care Research and Review
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Growing Diversification in HMOs, 1988-1994

Jon Gabel

KPMG Peat Marwick

Heidi Whitmore

Center for Studying Health System Change

Chris Bergsten

American Association of Health Plans

Lily Pan Grimm

Standard Technology, Inc.

Based on data from annual surveys conducted by the American Association of Health Plans, this article shows growing product diversification among the nation's HMOs. Between 1988 and 1994 the percentage of HMOs offering point-of-service (POS) plans increased from roughly 20 percent to 74 percent, and the percentage offering PPO plans rose from about 25 percent to 58 percent. Today, most HMOs view themselvesas managed care organizations (MCOs) offering an array of health plans and products, not as traditional, close-ended HMOs. Future analysis of the health care industry should regard the MCO rather than the HMO as the unit of analysis. One potential developing problem is the growth of self-insured HMO plans. If current trends continue, self-insured HMO plans could erode the insurance function in the HMO market, as occurred in the indemnity market in the 1980s.

Medical Care Research and Review, Vol. 54, No. 1, 101-117 (1997)
DOI: 10.1177/107755879705400106
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T. J. Hoff and L. C. Witt
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Med Care Res Rev, June 1, 2000; 57(2): 139 - 160.
[Abstract] [PDF]