Cost-Conscious Care

In praise of HMOs

David Jacobsen from the June 1996 issue

(Page 2 of 2)

Unnecessary diagnostic tests are probably the most familiar example of American medicine's spendthrift ways. Our computers are now set up so that every time a physician orders a laboratory test or X-ray procedure, a window on the screen displays the cost. Before managed care we neither knew nor asked. Preliminary analysis shows that this minor innovation has significantly reduced the ordering of routine laboratory and X-ray tests, especially among medical residents (physicians in training).

Much criticism of HMO care focuses not on common procedures such as these but on rare, emotionally charged illnesses. The cover story in the January 22 issue of Time, for example, chronicles the experience of a woman with advanced breast cancer whose HMO refused to pay for bone marrow transplantation. In such desperate cases, everyone understandably feels that something ought to be done. But the truth is that bone marrow transplantation for advanced breast cancer is a dangerous and expensive treatment of no proven benefit. This kind of case must be handled on an individual basis with consummate compassion and understanding, but it should not divert our attention from the myriad ways in which good medical care can be delivered for less money.

The significance of the potential conflict between physician income and patient welfare has also been exaggerated. First of all, it is offensive to me and the overwhelming majority of my colleagues to suggest that we would pad our bank accounts by obstructing or denying necessary medical care to our patients. I hew to an ethical standard of care, and so does my HMO. I am first and foremost the advocate of my patients, but always within the constraints of appropriate care and limited resources. More care is not always better care, and wishing that medicine could be exempt from the laws of economics does not make it so.

While there are various arrangements by which physicians are compensated under managed care, the incentives are to provide neither too little care nor too much care but optimal care. Under managed care, the worst course I could follow is to provide less than optimal care. Delay in diagnosis or treatment would only invite more expensive diagnosis and treatment down the line (and probably a lawsuit as well). Denying needed care is not only bad ethics; it is bad business.

As for the highly publicized "gag clauses," which have been outlawed in Massachusetts and a number of other states, my HMO does not have one. HMOs are entitled to insist on the confidentiality of proprietary information, but my HMO and most others encourage physicians to discuss financial incentives, covered benefits, and care options with patients. Many physicians are understandably dispirited by what they view as the demise of traditional health care and by projections of a 150,000-physician glut by the year 2000. But grievances and frustrations should be discussed with management and peers. Discussing them with patients can only erode an already embattled doctor-patient relationship.

Despite the charges of conflict and carnage, the evidence suggests that most physicians and patients are adjusting remarkably well to the managed care revolution and that the quality of care remains high. Studies have consistently shown that HMO patients are at least as satisfied with their care as patients receiving traditional fee-for-service care. A recent survey by CareData Reports, a New York health care information firm, revealed that, among members of 33 HMOs nationwide, nearly 80 percent were satisfied with their care. (The lowest ratings were not for quality of care but for administration and communication.) A 1994 study of 25,000 employees conducted by Xerox showed that HMO patients were significantly more satisfied with their overall care than were fee-for-service patients. In a 1994 Federal Employee Health Benefits Program survey of 90,000 federal employees, 86 percent of HMO members said they were satisfied with their plans, compared with 82 percent in fee-for-service plans. Interestingly, a 1994 survey by Towers Perrin revealed that patient satisfaction with HMO care rose with years of membership.

The results of research using objective measures have been similar. A 1996 study by KPMG Peat Marwick found that, in cities where most health care was provided by HMOs, costs were 11 percent lower, hospital stays 6 percent shorter, and death rates 5 percent lower than in cities where most care was provided under fee-for-service arrangements. A study recently published in the Journal of the American Medical Association looked at costs and outcomes of treatment for several chronic illnesses. Compared with fee-for-service specialists, HMO primary care physicians used 40 percent fewer hospital days and 12 percent less drugs. At four- and seven-year follow-ups, patient outcomes were the same.

A 1995 North Carolina study looked at the cost and outcome of treatment for lower-back pain. Costs for a single episode ranged from $169 in an HMO to $545 at a fee-for-service chiropractor, while outcomes were identical. As David Nash, an HMO expert at Jefferson Medical College in Philadelphia, told the Chicago Sun-Times last year, "Overwhelmingly, the published evidence supports the notion that quality of care in the managed care arena equals, if not surpasses, the care in the private, fee-for-service sector."

The shift to managed care unquestionably imposes greater responsibility on patients. More information is becoming available to enable them to compare costs and benefits and make intelligent choices. We ought to disabuse ourselves of the notion that we can have a perfect health care system in which no one is ever misdiagnosed, mismanaged, or missed altogether. But high-quality medical care at an affordable price is not only possible under managed care; it is a reality.

Comments

nfl jerseys|11.16.10 @ 9:20PM|#

nbc

log in or register to reply

Hirurgija Beograd|9.14.11 @ 2:17PM|#

"High-quality medical care at an affordable price is not only possible under managed care; it is a reality." We sure hope so.

log in or register to reply