STUDY: SICKLY FARE WORSE IN HMOS : ELDERLY, POOR AFFECTED; AVERAGE PATIENT DOES OK.

Byline: Robert Pear The New York Times

Elderly people and poor people who are chronically ill tend to fare worse in health maintenance organizations, which pay a flat rate for each patient, than in conventional insurance plans, which pay doctors for each service, researchers reported Tuesday.

The researchers, led by John E. Ware Jr. of the New England Medical Center in Boston, said that for average patients there was no particular difference between the outcomes of treatment by HMOs and fee-for-service plans.

But in Tuesday's Journal of the American Medical Association, they wrote, ``Patients who were elderly and poor were more than twice as likely to decline in health in an HMO'' as in a fee-for-service plan.

The researchers said their findings, based on observation of 2,235 patients in Boston, Chicago and Los Angeles, should send ``a cautionary note to policy-makers.''

Ware and his colleagues studied adults with chronic illnesses, including high blood pressure, diabetes and congestive heart failure. Patients ranged in age from 18 to 97, with an average just under 58. Slightly more than half were women. The researchers classified patients according to whether there was a change for the better or the worse in their ``health status'': what they were able to do in everyday life and how they felt physically or mentally.

The researchers followed patients for at least four years. Collection of data began in 1986 and ended in the early 1990s. Some HMOs say they have stepped up efforts to improve the quality of care in recent years.

The authors noted that chronically ill patients who are elderly or poor ``account for a disproportionate share of health care expenditures and are therefore prime targets of cost containment.''

Fifty-four percent of the elderly HMO patients and 28 percent of the elderly fee-for-service patients experienced some decline in physical health, the researchers reported.

Low-income patients also fared worse in HMOs than in fee-for-service health plans, the researchers said. For poor patients who initially had some type of illness, 22 percent of those in HMOs and 57 percent of those in fee-for-service plans showed improvements in physical health.

Karen Ignagni, president of the American Association of Health Plans, said the findings were at odds with recent research showing that chronically ill people who were elderly or poor had received excellent care in HMOs. The quality of care in such prepaid health plans is at least as good as that in fee-for-service plans, she said.

But Professor Sara Rosenbaum, director of the Center for Health Policy Research at George Washington University, said: ``The new findings are consistent with a long line of research showing that poor people with health problems tend to do worse in prepaid health plans.