Changes in Newborn Delivery During a Period of Rapid Expansion of Medicaid Managed Care in Los Angeles and Orange County Ruey-Kang Chang, MD, MPH UCLA Medical Center Los Angeles, California *Partly funded by the Agency for Healthcare Research and Quality (1 R03 HS13217)

BACKGROUND Since its beginning in 1966, Medi-Cal (California Medicaid program) had predominately used a fee-for- service (FFS) health care delivery system State legislation in 1991 and 1992 allowed under specific circumstances to direct the defaults into managed care and enabled a substantial expansion of Medi-Cal managed care Medicaid managed care (MMC) may affect the process and outcomes of care

OBJECTIVES To investigate if the newborn delivery market is becoming decentralized over time with MMC expansion To determine if decentralization is associated with an increase in the rate of inter-hospital newborn transfer To examine if decentralization is associated with changes in the process of care (rate of Cesarean section) and outcomes of care (in-hospital mortality)

METHODS We selected the two largest counties in the California– Los Angeles and Orange County Los Angeles CountyOrange County Population9,790,0002,813,700 Public health system County hospitalsNo county hospital MMC plansTwo-plan modelCOHS program

METHODS– data sources California Office of Statewide Hospital Planning and Development (OSHPD) California Vital Statistics, birth record American Hospital Association database Of OSHPD data on hospital discharge, all newborns delivered in LA and OC hospitals were identified by ICD-9 diagnostic code (V30-V39)

Types of Insurance Insurance: Medi-Cal, Private, and Others Private– grouped from HMO/PHP, PPO, Blue Cross/Blue Shied, indemnity insurance Others– self pay, charity care, Medicare, worker’s comp, title V, other government, other non- government

Types of Hospitals Type of HospitalNumber (N) For Profit Corp.42 For Profit Individual2 For Profit Partnership8 Government County5 Government Hospital District2 Government State3 Non-Gov Non-Profit Church12 Non-Gov Non-Profit Other49 Total123 For Profit (52) Public (11) Non-Profit (61)

Herfindahl-Hirschman Index (HHI) An index for measuring distribution of market share among healthcare facilities HHI= Σ (market share of hospital i ) 2 HHI values range from 0 (complete even distribution) to 1 (most uneven distribution), the greater HHI, the more uneven distribution in the market

RESULTS

There were 2,351,199 newborn deliveries in LA (1,832,287) and OC (518,922) between Total 123 hospitals providing the services, 91 in LA and 32 in OC The number of newborns per year decreased by 21% over the study period

Shifting of Newborn Deliveries

LAC-USC Medical Center King-Drew Medical Center Olive View Medical Center Harbor-UCLA Medical Center Decreasing Numbers of Deliveries in County Hospitals

Market Share by Hospital Type

22% 8%

Market Concentration

Market Concentration– Medi-Cal

Market Concentration-- Overall

Market Concentration

Rate of Cesarean Section

C-Section Rate– Overall

C-Section Rate– LA County

C-Section Rate– Orange County

Rate of Inter-Hospital Transfer

Transfer Rate– LA County

Transfer Rate– Orange County

In-Hospital Mortality Rate

Mortality Rate-- Overall

Mortality Rate– LA County

Mortality Rate– Orange County

CONCLUSONS Newborn deliveries were decentralized to small community, non-profit hospitals during the period of rapid Medi-Cal Managed Care in the 1990s Increasing C/S rate and decreasing mortality made Medi-Cal patients look more like the private insurance patients No increase in inter-hospital newborn transfer or in-hospital mortality was seen in Medi-Cal patients comparing to private insurance patients

MMC expansion might be one of the important factors led to market decentralization The Two-Plan Model and COHS model influenced the market in similar ways Decentralization of NB delivery might affect the process of care, however, outcomes of NB, such as inter-hospital transfer, in-hospital mortality, were not affected Policy Implications

HHI= 5*0.2 2 =0.2 20% More even distribution

80% 5% More uneven distribution HHI= * =0.65

Year OSHPD Data on Delivery % Difference Comparing to Birth Registry Data Total # of BirthsLA County Orange County % differenceLA County Orange County %2.1%4.8% %1.5%5.2% %2.3%4.1% %2.9%3.6% %3.6%5.7% %2.7%4.8% %2.2%5.0% %1.4%7.0% %0.5%7.3% %0.6%7.4%