Association of Provider Performance with Changes in Insurance Networks

Medicaid managed care plans change provider networks frequently, yet there is no evidence about the performance of exiting providers relative to those that remain.

To investigate the association between provider cost and quality and network exit.

Observational study with provider network directory data linked to administrative claims from managed care plans in Tennessee’s Medicaid program during the period 2010–2016.

1,966,022 recipients assigned to 9593 unique providers.

Exposures were risk-adjusted total costs of care and nine measures from the Healthcare Effectiveness Data and Information Set (HEDIS) were used to construct a composite annual indicators of provider performance on quality. Outcome was provider exit from a Medicaid managed care plan. Differences in quality and cost between providers that exited and remained in managed care networks were estimated using a propensity score model to match exiting to nonexiting providers.

Over our study period, we found that 21% of participating providers exited at least one of the Medicaid managed care plans in Tennessee. As compared with providers that remained in networks, those that exited performed 3.8 percentage points [95% CI, 2.3, 5.3] worse on quality as measured by a composite of the nine HEDIS quality metrics. However, 22% of exiting providers performed above average in quality and cost and only 29% of exiting providers had lower than average quality scores and higher than average costs. Overall, exiting providers had lower aggregate costs in terms of the annual unadjusted cost of care per-member-month − $21.57 [95% CI, − $41.02, − $2.13], though difference in annual risk-adjusted cost per-member-month was nonsignificant.

Providers exiting Medicaid managed care plans appear to have lower quality scores in the year prior to their exit than the providers who remain in network. Our study did not show that managed care plans disproportionately drop high-cost providers.