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Report Slams For-Profit HMOs

While Congress debates the details of a patients' bill of rights, a new study published in Wednesday's Journal of the American Medical Association says that not-for-profit HMOs are more likely than their investor-owned counterparts to make sure their members get early prenatal care, timely immunizations and other preventive tests and treatment.

The report concluded that for-profit health maintenance organizations' moneymaking mission compromises care for its members.

"Our study found the quality is consistently lower at for-profit HMOs than at non-profit," researcher Dr. Steffie Woolhandler told CBS News Correspondent Bill Whitney.

Although most of the patients' fees for coverage were the same, the study said the services received were markedly different.

The results announced by Harvard Medical School researchers and Public Citizen Health Research Group - a consumer advocacy group that favors government-controlled health insurance - may further stir public angst about HMOs as Congress this week debates legislation to enhance patients' rights.

More than two-thirds of the nation's HMOs are for-profit, about three times the level in 1985.

In the study, researchers analyzed 346 HMOs for how well they performed 14 quality indicators such as prenatal care, infant immunization and breast cancer screening. In each criterion, the not-for-profits scored higher than the for-profits, said the report which reviewed 1996 patient care data.

To highlight the difference in results, the study estimated that nearly 6,000 additional breast cancer deaths would occur in the United States if all women between ages of 50 and 69 were enrolled in investor-owned rather that not-for-profit plans. Not for-profit HMOs screened an average of 75.1 percent of women for breast cancer compared to 69.4 percent for investor-owned plans.

In another comparison, about 48 percent of diabetics in not-for-profit HMOs were given an annual eye exam compared to 35 percent of diabetics in for-profit plans. Eye exams are a crucial diagnostic test to measure how well diabetics are managing their disease.

The findings were disputed by HMOs -- both for-profit and not-for-profit -- as well as the HMO accrediting organization whose data was used to conduct the study.

"Making these broad generalizations makes us uncomfortable," said Margaret O'Kane, president of the National Committee for Quality Assurance, a Washington D.C.- based HMO accrediting group. She said health plan performance varies significantly even within the same region and among plans owned by the same company.

Not-for-profit HMOs, which have recently tried to draw a distinction between themselves and investor-owned plans, could get a lift from the report. But at least one executive with a not-for-profit HMO faulted the study's methods. "I don't buy it," said Dr. James Moffat, senior vice president for medical affairs at Miami-based Av-Me Health Plans.

Moffat and other critics argued comparing not-for-profit and for-profit HMOs is unfair because in most cases, the types of plans operate differently.

The biggest difference is that not-for-profit plans such as Kaiser Permanente usually have their own staff of doctors who exclusively treat the HMO's members. That gives the HMO greater control of the doctor, and ultimately, patient care.

For-profit HMOs, such as Aetna U.S. Healthcare, contract largely with the same doctors used by other HMOs. That system gives patients a greater choice of doctors, but reduces the impact an HMO can have on a physician's practice.

The study's authors say their statistical calculations took into account the HMO's structure and still found that not-for-profits performed better than for-profits in all of the quality indicators measured.

"Given how consistent the findings are, it's hard to come up with any other explanation," said Dr. Sidney Wolfe, one of the investigators who also heads the Public Citizen Health Research Group.

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