Daniel Polsky, Ph.D.

Daniel Polsky, Ph.D., is a Research Associate Professor in the Division of General Internal Medicine at the University of Pennsylvania and a Senior Fellow at the Leonard Davis Institute of Health Economics. His topics of research include health insurance and health care access, economic evaluation of medical interventions, and the health care workforce.

In a HCFO-funded study, Polsky and colleagues analyzed risk selection in the employer-sponsored health insurance market. Using data from Round I of the Community Tracking Study Household Survey (CTSHS), they found that the lower premiums of managed care plans could not be explained by favorable risk selection of enrollees. Rather, lower reimbursement rates were largely responsible for lower premiums. The risk selection that was pervasive among Medicare-HMOs, did not play a large role in the premium differences among health plan types in the employer-sponsored health insurance market.

When Round II of the CTSHS was released, HCFO funded Dr. Polsky to conduct a follow-up project to explore these issues further using panel data methods. With panel data, the switching behavior between plan types could be assessed to determine whether enrollees of favorable risks were more likely to switch into a managed care plan. With this design, Polsky and his colleagues at the University of Pennsylvania observed the degree of risk selection at the margin. They found that people who switched from a non-HMO to an HMO plan used 11 percent fewer medical services in the period prior to switching than people who remained in a non-HMO plan, and that this relatively low use persisted once they enrolled in an HMO. Furthermore, people who switched from an HMO to a non-HMO plan used 18 percent more medical services in the period prior to switching than those who remained in an HMO plan.

Commenting on the findings regarding risk selection, Polsky contends that, “While favorable risk selection for HMOs does exist on the margin, this phenomenon is not responsible for the average expenditure differences between HMOs and more traditional health plans.” Dr. Polsky adds, “These results have implications for health plan regulations, how employers should apply risk adjustment when determining employee contributions, and the value of health plan choice for consumers.”

HCFO also sponsored earlier work by Dr. Polsky that studied how the geographic distribution of physicians was influenced by the growth of managed care in the 1990s. And in other work, Polsky acts as the principal investigator on an R01 grant from the National Institute on Alcohol Abuse and Alcoholism (NIAAA), which addresses statistical methods for cost research in alcohol studies. His cost-effectiveness research has focused on correcting for selection bias in observational studies, innovations in the estimation of costs and the methods of economic analysis in clinical trials.

Dr. Polsky holds a Ph.D. in economics from the University of Pennsylvania. He earned his Masters in Public Policy and his Bachelors degree from the University of Michigan.

Selected References

1. Nicholson S, Bundorf MK, Stein RM, Polsky D. “The Magnitude and Nature of Risk Selection in Employer-Sponsored Health Plans” Health Services Research. In press.

2. Polsky D, Nicholson N. “Why Are Managed Care Plans Less Expensive: Risk Selection, Utilization, or Reimbursement?” Journal of Risk and Insurance. 2004 March; 71(1):21-40.

3. Polsky D, Mandelblatt JS, Weeks JC, Venditti L, Hwang YT, Glick HA, Hadley J, Schulman KA. “Economic evaluation of breast cancer treatment: considering the value of patient choice.” Journal of Clinical Oncology. 2003 Mar 15;21(6):1139-46.

4. Polsky D, Kletke PR, Wozniak GD, Escarce JJ. “Initial practice locations of international medical graduates.” Health Services Research. 2002 Aug; 37(4):907-28.

5. Polsky D, Kletke PR, Wozniak GD, Escarce JJ. “HMO penetration and the geographic mobility of practicing physicians.” Journal of Health Economics. 2000 Sep; 19(5):793-809.