Ethics and Managed Care

Where did it go wrong? (If it did?)

Louis Harris Poll, 1980

97% of HMO enrollees satisfied, would renew

30% of non-members find HMO concept very attractive

WARNING

The following slide contains adult language.

“Fucking HMO bastard pieces of shit!”

--As Good As It Gets (1997)

You know you’ve joined a cheap HMO when….….They give you Viagra tablets in different colors with little “m’s” on them.

--David Letterman

What is managed care?

Same organization combines two functions Insurance Delivery of services

Specified, covered populationProspective financing of services

from a limited budget•Buchanan, 1998

The first HMO’s

1940’sEither labor union-driven or community

cooperative (all non-profit)Payment per member per month

(capitation)Financial incentive to keep people

healthyGroup practice/clinic model

Turning Point: 1970-1980

Health care share of GDP went up from 4% to 10-12% since 1945

Big Three realized they were paying more on a per-car basis for health care than for steel

For first time, HMO’s attractive as a way to cut costs, not as a way to change the direction and quality of care

1980-2000

New Federal legislation encourages creation of HMO’s

Some evidence early that this led to a slow-down in rise of health costs (temporarily)

Suddenly for-profit managed care is the fastest growing segment of industry

Kaiser plan, 1970

Has served same population for 30 yearsVery stable group of physicians and staffMost work there out of choiceWork as team to assure that quality of

care is kept highThe “competition” is very wasteful, so

even a modest trimming of costs makes Kaiser the best deal

Acme HMO, 2000

May have been created yesterdayPhysicians are tied in “virtual”

network, no history of teamworkRapid turnover of patients, no way to

capture savings from preventive care

Competition lean and mean; can’t compete unless costs cut to the bone

Does the term “managed care” specify an entity with a constant, predictable set of ethical problems?

Basic ethical problem

Physician or nurse as “gatekeeper”Gatekeeper may recommend care as

“medically necessary” or not Plan pays for “medically necessary”

careIf less care recommended, staff may

make more money (or may be retained, not fired)

RationingBedside Rationing

RationingThere is a limited amount of resources

availableNeed/demand exceeds the available

resourcesWe must have SOME system to decide who

gets how much Ability to pay Lottery Degree of need Etc.

Where Rationing Occurs

AdministrativeLevel

Bedside Level

Administrative Rationing

Policymakers set very general guidelines based on data of effectiveness and cost

Physicians at bedside merely apply those guidelines with virtually no discretion

Examples: No one over age 70 gets renal dialysis No one gets expensive anti-ulcer medication

for more than 2 months

“[I]t is society, not the individual practitioner, that must make the decision to limit the availability ofeffective but expensive types ofmedical care.”

--Norman Levinsky (p. 102)

Bedside Rationing

Physician/nurse caring for individual patient

Makes a decision not to provide some treatment

Decides on basis of relative need of this patient vs. other patients in “plan”

Trust and Rationing

Levinsky’s argument:If administrative rationing, physician is

still uncompromising in personal dedication to patient welfare

If bedside rationing, physician a double agent-- willing to compromise patient welfare in name of cost saving or service to “society” (= other patients)

Fee-for-service practice

Patient (or insurance company) paid a set amount for each service

Strong financial incentive for physician to recommend or perform unnecessary services Return office visits Unnecessary surgery Unnecessary labs, x-rays

No one has yet designed a way of financing health care that pays the providers when, and only when, they do something beneficial for the patient

--so every plan has some perverse incentives

Is Less Care the Problem?

Assume ethical flaw in managed care is that physician is rewarded for doing less for the patient

Assumes that more care is always better care

If so, should see consistent trend in research for managed care to have worse outcomes (not so)

One Example: ABMTABMT for advanced breast cancer:

thought to provide 10-15% chance of survival when all else has failed

Costs ~ $150,000Many women sued HMOs successfully

when ABMT denied because “experimental”

Latest research-- ABMT adds nothing to survival in advanced breast cancer

The real question

Is gatekeeping ethical?

Can gatekeeping be avoided?

What is Gatekeeping?

Physician cares for a population of patients

Limited budgetIf patient #1 gets something, there

is something that the other patients will not get

Comparative judgments of relative priorities of need among patients

Example 1. ICU nurse

Nurse has 2 patientsMr. Smith: Just about ready to transfer

out but has a lot of questionsMrs. Jones: Acutely unstable,

impending multiple organ system failure; unsure of cause

Who will you spend more time with?

Example 2. Primary care office

NP has waiting room full of patientsMrs. Green: Has a 10-min appointment,

starts to complain of several new problems which she has had for years

Mr. White: Has a 10-min appointment; “Oh by the way” chest pain

Will you reschedule or run overtime?

Inevitability of Gatekeeping

Time and not just money is a limited resource

So long as you have more than one patient in your practice, you must always make tradeoffs among needs of different patients

Seems reasonable to make tradeoffs based on best assessment of relative need

Inevitability of Gatekeeping (Morreim)

Policy-makers write clinical guidelines to save money and maintain quality

All guidelines have “wiggle room”Physician must decide whether to

adhere to guideline or try to declare this patient an exception-- both “bedside” decisions impact on resources available to other patients

Eddy’s Argument

Two positionsFirst position: I am generally healthy,

my chances of getting any one particular disease are relatively low

Second position: I already have developed an advanced disease

30yo Healthy Woman

Would rather have lower premiums and put money in kid’s college fund, etc.

Strong interest in funding preventive care e.g. mammograms

Little interest in funding “desperation” care like ABMT

45yo Woman with Metastatic Breast Cancer

Prevention is now of no use“I’ve paid my premiums for all those

years; now it’s my turn to get something back”

Strong interest in having funding for “last ditch” measures even if low likelihood of success

Eddy: The Conflict

Should we interpret the ethical question as “the patient vs. society”?

Or is it ourselves at one point in our lives vs. ourselves at another point in our lives?

If the latter, which of the two positions is ethically privileged in terms of taking a moral priority for health policy? Eddy argues: First position

When is Gatekeeping Unethical?

Very generally-- when financial incentives are so intrusive into physician’s thoughts that she is highly likely to place financial concerns ahead of concerns for the well-being of the patient

Bowman Case (TN)

Prisoner died of pneumonia; had known sickle cell disease

For profit prison management firm had capitated contract with physician

By denying care physician could double his annual income

No “carve out” for prisoners with known serious illnesses

Gatekeeping cases: spectrum

Predominant duty is todo what’s best for sick person

Predominant duty isto conserve scarceresources for others

“Gray zone”-- tough choice(e.g., treatment very expensive but also very beneficial)

Example:IV antibiotics for pneumonia

Example: MRI scan fortension headaches

For-Profit Managed Care

Is this form of financing inherently unethical?

Is a for-profit plan inherently less trustworthy?

Non-Profit Plan

Admin Care

For-Profit Plan

Admin

Care

Dividends

For-Profit vs. Nonprofit

Unless for-profit plans considerably more efficient, they will have less $ to spend on care No evidence of such efficiency

BUT at least a few non-profit plans spend less on care than a few for-profit plans, tho on average NP spends greater percentage than FP