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| Microregulation is a mistake | ||
By Eric E. Shore, DO, MBA
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Dr. Brown's article cautioning
against well intentioned (sometimes) but poorly conceived legislation to reign in the
alleged abuses of managed care companies is well taken, but slightly off of the mark. Like most physicians who have had to deal with managed care, especially in Primary Care, we see the abuses on a nearly daily basis. Patients are required to be discharged from the hospital a day or two before we actually feel they should be, a medication that has had a patient's hypertension well controlled for two years is no longer covered by their plan, thus creating the nightmare of searching for an effective substitute and then re-titrating dosages, etc. But these and other abuses, some major, some minor, will tend to be corrected more rapidly and efficiently by market forces than by legislation. There is no more effective curb on abuse than when employers, because of employee complaints, change carriers, and thus decrease profits to the insurer. Likewise, while Dr. Brown postulates significant increases in premiums with anti-abuse legislation (some of which are likely, indeed), it must be remembered that there is a great deal of administrative "fat" in these companies, and that trimming this fat can maintain profit margins while paying a greater percentage of the premium for actual care. The reason why this would occur is simple and straight forward - market pressure. In an industry in which employers (and thus their employees) have a variety of competitors from which to choose, and the products are substantially undifferentiated, price is usually the determining factor. In this case, managed care companies will be driven to maintain higher levels of care and service (product quality), while keeping costs at or below their competitors' so that they achieve increasing market penetration. We have already begun to notice a swing away from pure managed care back to a more hybrid approach, because of market forces, and this will continue until "consumers" are sufficiently satisfied with the "product" to re-purchase it. Finally, as for litigation, it is something that every industry accepts as a cost of doing business. We, in the United States, live in the most litigious society in the world. Everyone sues everyone else, perhaps because we have the highest ration of lawyers to population of any country in the industrialized world. In effect, litigation holding managed care companies responsible for their actions (real or perceived) is a product liability issue, much as Medical Malpractice has become. In short, I agree with the need to avoid microregulation of an evolving industry, but not because these companies employ thousands of medical professionals (most of whom have no significant input into the process, and those that do have a vested interest in showing companies how NOT to pay), but because such legislation is unnecessary and inherently wasteful and, as Dr. Brown correctly states, will inhibit innovation. |
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