As a physician, I dislike involuntary managed care as much as most patients, but the thought of lawyers running the medical delivery system for their own benefit is even more distasteful. The recent Supreme Court decision limiting class action lawsuits against HMOs reached the right diagnosis and treatment.
In the United States there are 160 million people covered under managed care. Since Orange County and California have the nation’s highest managed care penetration (90%), the recent Supreme Court decision on suing HMOs especially has tremendous monetary and quality-of-care significance here for employers, for-profit managed care insurance companies and patients.
The lawsuits thrown out by the court attacked the very way HMOs do business. The suits claimed that HMOs violated RICO laws, the federal law originally aimed at organized crime racketeering. The suits also claimed that HMOs were breaking the federal ERISA law governing retirement plans by not disclosing information about how HMOs offer incentives for physicians.
Many HMOs do use these incentives to induce their physicians to ration care, limit spending and cut costs. The Supreme Court ruled that Congress intended for HMOs to limit spending!
Many patients are already unhappy with their HMO care. I suspect this is largely because patients know that their medical needs and plans will be filtered through a cost-cutting bureaucracy and could be cancelled. Allowing lawyers to set the rules would cause medical care to be delayed even further, as lengthy appeals of HMO decisions work their way through the court system. As with justice, medical treatment delayed is treatment denied.
Allowing lawyers to loot the medical system and inflate costs would only make premiums more expensive. Managed care organizations already take out 20% to 40% for overhead. If the Court had declared open season on HMOs the overhead plus liability costs might reach 75%. In some cases the HMO might vanish overnight.
Lets not forget that the trial lawyers in the late 1970s sued the medical profession to death. Resultant high medical malpractice premiums, plus costly extra defensive lab tests and diagnostic studies, laid the groundwork for the government, insurance companies and Wall Street entrepreneurs to take over the practice of medicine.
We need to consider other costs of excessive legalism. How many medical breakthroughs never happened because research was thwarted by the threat of legal action? And healthcare financing innovations that would help patients, such as medical savings accounts, are greatly slowed by drag from the legal system.
In the long run, it is far better for the patients to decide where they want to spend their healthcare dollars, what kind of insurance they want, when to spend it, and how much they want to pay directly or on insurance premiums. More dollars going into legal pockets and fewer to patient treatment would not have been good for the health of the nation. The Supreme Court made the right diagnosis.
Michael Arnold Glueck, M.D.
Newport Beach
Quackenbush
I am relieved and pleased that Chuck Quackenbush has at last seen fit to vacate the office he was elected to. The people of California deserve an insurance commissioner who is dedicated to their needs. Quackenbush lost sight of that, and his actions after the Northridge earthquake were both self-serving and outrageous.
May this episode serve as an ample warning to all of California’s elected officials that the public trust must not be breached in their quest for money and power.
Art Pedroza Jr.
Unit President
Santa Ana Republican Assembly
Santa Ana
