The End of Managed Care

** PLEASE READ THIS ONE ** This is an important quote about the direction in which our health care system is headed.

JAMA May 23/30, 2001

By James C. Robinson, Ph.D., Associate Professor of Health Care Economics, University of California, Berkeley

"The consumer era in health care is emerging due to the rejection of governmental, corporate, and professional dominance rather than due to a judicious evaluation of the alternative."

"Four problems will plague a consumer-driven health care system. First, despite the widespread dissemination of information, consumers will face significant obstacles in understanding the quality and even the true price of health insurance and health care services. Variations in utilization, cost, and outcomes challenge the analytical capabilities of governmental, corporate, insurer, and physician organizations and are daunting even for the most sophisticated and Internet-enabled consumer. Second, consumers vary enormously in their financial, cognitive, and cultural preparedness to navigate the complex health care system. The new paradigm fits most comfortably the educated, assertive and prosperous and least comfortably the impoverished, meek, and poorly educated. Third, the consumer era will complicate the pooling of insurance risk between consistently healthy citizens and those who are chronically ill. Risk-adjusted subsidies by government and employers can foster risk-spreading, but the requisite actuarial methods are only embryonic. Finally, the emerging era will make transparent and render difficult the redistribution of income from rich to poor that otherwise results from the collective purchasing and administration of health insurance. The proliferation of insurance products and physician networks likely will accentuate the contemporary allocation of care based on ability to pay, partially mitigated through tax exemptions and refundable tax credits."

Comment: Perhaps the most appropriate comment is that of the author, James Robinson, in a May 23 Reuters release, "If all the good people got together and designed a health care system, they wouldn't design the health care system that we're heading towards."