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Health plans, employers, and public payers are experimenting with a number of new models of contracting with the
providers of specialty care. These "carve-out" contracts can involve care for particular conditions, particular types of
services, or all care for particular subpopulations. The defining common feature of these contracts is that they engage
different providers and management entities from those otherwise available for care of the same patients within a general
health plan. These new forms of contracting appear to reduce the cost of care for employers and some health plans; they
may or may not improve health outcomes. Moreover, carve-out services can change the terms of competition among
To sharpen the research questions pertaining to carve-outs, review the available evidence, and build an agenda for future
research, AHCPR's Center for Organization and Delivery Studies convened a workshop in January 1998. Six experts and
expert teams on carve-outs developed papers to serve as focal points for the workshop. Because these are topics where
publication and release of data can be inhibited by proprietary concerns, the organizers were fortunate to enlist experts with the
capability and willingness to take time away from their normal duties to bring important information and concerns to light.
Each presentation was critiqued by a topical expert and the authors were given an opportunity to respond.
Guest authors participating in the workshop were: Richard Frank, Ph.D. and David Blumenthal, M.D. (Harvard); Saul
Feldman, Ph.D. (United Behavioral Health); Bettina Kurowski, Ph.D. (formerly VP of SalickNET); Robert Master, M.D.
(Community Health Alliance, MA); and Joseph Carver, M.D. (Aetna). The discussants from AHCPR were Kelly Devers,
Ph.D., Bernard Friedman, Ph.D., Carolyn Clancy, M.D., and Fred Hellinger, Ph.D. Also participating were Thomas Marciniak, M.D.,
Health Care Financing Administration, and Bernard Lo, M.D., University of California at San Francisco.
Taken together, the papers provide a useful synthesis of what we know and do
not know about genesis, form, and impacts of the array of carve-out and specialty contracting models existing today. The
papers, listed below, were published in a Special Issue of the American Journal of Managed Care, June 25, 1998.
Friedman, Bernard; Devers, Kelly; Hellinger, Fred; Fraser, Irene. Carve-outs and Related Models of Contracting for
Specialty Care: Framework and Highlights of a Workshop. American Journal of Managed Care 4 (June 25, 1998) SP11-21.
Frank, Richard G.; McGuire, Thomas G. The Economic Functions of Carve-outs in Managed Care. American Journal of
Managed Care 4 (June 25, 1998) SP31-39.
Blumenthal, David; Buntin, Melinda Beeuwkes. Carve-outs: Definition, Experience, and Choice Among Candidate
Conditions. American Journal of Managed Care 4 (June 25, 1998) SP45-57.
Feldman, Saul. Behavioral Health Services: Carved Out and Managed. American Journal of Managed Care 4 (June 25,
Kurowski, Bettina. Cancer Carve-outs, Specialty Networks, and Disease Management: A Review of Their Evolution,
Effectiveness, and Prognosis. American Journal of Managed Care 4 (June 25, 1998) SP71-89.
Master, Robert J. Massachusetts Medicaid and the Community Medical Alliance: A New Approach to Contracting and
Care Delivery for Medicaid-Eligible Populations with AIDS and Severe Physical Disability. American Journal of
Managed Care 4 (June 25, 1998) SP90-98.
The Center for Organization and Delivery Studies of AHCPR would welcome discussion of research designs and funding
mechanisms to support future research on the effectiveness and outcomes of Carve-outs. If interested, please contact
Bernard Friedman at (301) 427-1404.
Current as of February 1999