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On June 7, 1984, the New England Journal of Medicine publishes a Rand Corporation report finding that Group Health Cooperative delivers equal care for much less money. The report publishes the initial results of a federally funded, eight-year comparative study of Group Health and other delivery systems, including fee-for-service delivery systems. Titled "A Controlled Trial of the Effect of a Prepaid Group Practice on the Use of Services," the report finds that the much-lower costs come from a much lower rate of hospitalization. Later findings will confirm that the lower rate of hospitalizations does not reflect lower levels of health status. The report receives front-page news around the country and, ironically, will result in competing pre-paid plans entering into Group Health's market.
Sources:
Walt Crowley, To Serve the Greatest Number: A History of Group Health Cooperative of Seattle (Seattle: GHC/University of Washington Press, 1995), 187-189.
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