Private Payers Serving Individuals with Disabilities and Chronic Conditions. B. Why This Study Was Conducted


According to the 1989 National Health Interview Survey, about 48 percent of those with disabling conditions were treated in private-sector indemnity and managed care plans. However, very little is known about how persons with potentially disabling conditions fare in private-sector plans. Information on their demographics, case mix, service use, and outcomes is scarce in the health services literature. The ASPE Private Payers Study was conducted to learn more about how chronically ill, potentially disabled people fare in managed care plans in comparison to indemnity plans offered by large employers.

Using data from the two employers’ health plans, this report first illustrates similarities and differences between those covered by indemnity and managed care plans. Second, we present findings on the impact of managed care on health care utilization and expenditures for those with potentially disabling chronic conditions. Third, we illustrate the impact of various methods of risk-adjustment, in order to make inferences about the financial incentives that managed care plans faced to attract or avoid persons with chronic illness.

It is our hope that the information produced by the Private Payers Study will contribute important empirical findings to a small but growing knowledge base, so that policy makers and employers will better understand the characteristics and service needs of those with potentially disabling chronic illness. Policy makers and employers will also better understand the financial incentives and likely impact of managed care for persons with disabilities. This information will provide clues about the potential consequences of expanding managed care options in a variety of both private-sector and public-sector settings.

View full report


"privpay.pdf" (pdf, 3.64Mb)

Note: Documents in PDF format require the Adobe Acrobat Reader®. If you experience problems with PDF documents, please download the latest version of the Reader®