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Med Care. 1992 May;30(5):412-27.

The effects of preferred provider options in fee-for-service plans on use of outpatient mental health services by three employee groups.

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  • 1RAND Corporation, Santa Monica, CA 90406-2138.


Descriptions of how preferred provider organizations (PPOs), offered as options to employees enrolled in fee-for-service plans, affected use of outpatient mental health services are provided. Data are from the RAND Preferred Provider Organization Study, which has a sample of employees who enrolled in fee-for-service plans 1 year before and 2 years after a PPO option was offered by three employers in two U.S. sites. To study effects of the optional PPOs on access to mental health care, usage patterns among those who initially stated that they did or did not intend to use PPO providers were examined. By the end of the second post-PPO year, employees had a similar annual probability of having an outpatient mental health visit whether or not they initially intended to use PPO providers. However, during the first post-PPO year, there was a decrease in the probability of use for those initially intending to use PPO providers, relative to those who did not intend to do so, among employees who had no regular medical provider. To study effects of the PPO option on usage levels of mental health care services, users of mental health services who primarily visited PPO were compared with those who primarily visited non-PPO providers. Users who visited PPO providers had significantly lower levels of use, controlling for other factors, than those who primarily visited non-PPO providers. Therefore, despite lower cost sharing for services received from PPO providers, the PPO option appeared to lower outpatient mental health care costs while having no more than a transient effect on access. This study did not evaluate mental health outcomes.

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