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2004

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Annual Study of California's Health Care Market Finds Shift in Economic Power

CHCF releases comprehensive analysis of health plan, hospital, and physician group performance

April 07, 2004

According to an annual market study of California’s health plans, hospital systems, and physician organizations, there has been a fundamental change in the way economic power is held and used in health care business relationships. According to author Allan Baumgarten, "Hospitals and medical groups once were partners, but they are now more likely to be competitors whose economic interests are more in conflict than alignment."

Baumgarten's report, California Health Care Market Report 2004, provides a broad overview of the organizations that finance, deliver, and organize health care for most Californians. Commissioned by the California HealthCare Foundation, the report is a comprehensive data resource on health care organizations' financial results, enrollment trends, market share, and measures of utilization and effectiveness of care.

Other key findings include:

  • Medical groups have been challenged by the declining demand for what has been their central role: managing the care of large numbers of patients enrolled in capitated HMO plans;
  • Variation in practice and performance has emerged as a key issue in payment systems, physician organizations, and the way issues like patient safety are approached;
  • Capacity of hospitals and physicians is now seen as limited instead of excessive, further strengthening providers’ negotiation power; and
  • The largest health plans and the largest purchasers continue to have enormous impact on the market.

The analysis, which includes more than 50 tables and graphs, is based on publicly reported data on health plans and hospitals, as well as interviews with some 40 leaders from California health plans, hospital systems, state associations, purchasers, and government agencies.

The market study specifically addresses:

  • Vital statistics on health plans, hospital systems, physician organizations, and purchasers;
  • California HMO enrollment and finances;
  • HMO utilization and effectiveness of care measures; and
  • Differences in the way physicians and hospitals in California organize, the role of Medi-Cal and Medicare, the involvement of private purchasers, and how health plans compete with each other.

View the report online through the link below.

Contact Information

media@chcf.org
California HealthCare Foundation