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UBC Theses and Dissertations

Health maintenance organizations for British Columbia : are they feasible? Hessey, Lynda Dianne


This policy/planning thesis takes the format of a hypothetical study done for the Senior Assistant Deputy Minister in the B.C. Ministry of Health. The Ministry had shown interest in restructuring as a means of setting some boundaries on an open-ended medical care system in order to reduce expenditures for health care services. Because the clients' specific interest was in the American health maintenance organization (HMO) model, the study was concerned with the feasibility of introducing this model into the health care structures of B.C. The problem situation of increasing expenditures for health care services in B.C. was described and relevant systems involved in the situation were identified as: the Ministry of Health, the medical profession and hospitals. The unique perspectives of each system were described so their implications for the feasibility of an HMO model could be assessed. The HMO model, in the American context, was analyzed according to its generic elements and variant characteristics. In addition, the policy process of developing and implementing the HMO strategy was described. The HMO was found to be a highly complex organization that integrates financial mechanisms and service delivery. Evidence reviewed about its performance indicated that HMOs are a less expensive means of providing care than fee for service practice, that hospitalization rates range from 20 to 40% lower and are the primary source of HMO cost saving and that enrollees probably receive comparable quality care. The publicly funded health insurance system presents a primary obstacle to adopting this model to a Canadian setting because of weakened financial incentives for competition. The principles upheld by the program also hamper enrolling a fixed population which is a basic HMO element. To implement an HMO model in B.C., considerable restructuring of financial systems would be necessary to redirect funds to an HMO so that it could be at financial risk for providing hospital and medical services to an enrolled population. In reviewing some policy options, it was apparent that an HMO model would be most easily adapted to B.C. within the context of publicly funded competition in medical care practice. However, there did not appear to be sufficient support from relevant constituencies for such a comprehensive approach. But a consensus was evident in support of an HMO pilot project in order to assess more fully feasibility problems, to build support for the concept and to evaluate its effectiveness.

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