15. Cost Effects of Managed Care

The influence of managed care on the cost of care is difficult to assess. Only few studies compare the entire cost of MCOs with those of the traditional fee-for-service insurances. Often only certain aspects are investigated, since the complexity would otherwise be impossible to address. Thus, the expenses of hospital services, the use of service providers and the influence on the prices of health services are examined. Due to higher economic efficiency and lower purchasing prices it is also difficult to separate the cost reductions in managed care from the selection effects. At least a portion of the cost advantages of MCOs seems to be due to the more favourable risks in the structure of insured persons in HMOs (Kühn 1997). Shimada et al. (2009) found similar results in their study. They identified that the insured in MCOs demonstrate a better state of health than those in fee-for-service insurances. However, this effect is put into perspective in regions with more competition. In general it must be stated that there is still a lack of established studies (see Sullivan 2000) and, to be fair, it must be assumed that such studies will not be available in the near future.