The Health Care Consumer's Unlikely Ally: Managed Care
MANAGED CARE February 2003. ©MediMedia USA
Managed care's strong points, obscured in the backlash over choice and coverage decisions, will be critical to consumers in the years ahead.
Having lived with Crohn's disease for 20 years, medical emergencies are part of my life. But when- ever I have to visit the emergency room of my local hospital, a top-ranked facility in Southern California, the staff can't find my medical records or medication history. I have to provide them. And although Crohn's is not an exotic ailment, they are often unsure about how to alleviate or monitor my pain. I have to coach them. After the visit, I spend hours sorting through a chaotic tumble of bills — deciding which to pay directly and which to pass on to my insurer, a loosely managed preferred provider organization.
If you don't understand why people are so frustrated with the state of American healthcare, take walk on the wild side — visit your local emergency room with an ailment. If you don't understand why American health care is inefficient and expensive, the same experience will do. The level of automation we've come to expect from our bank's ATM and the automated gas pump at the corner station is still years away from most hospitals and medical practices.
I've spent over a decade of my career inside some of the nation's largest health plans, so I fully understand that it's a gross oversimplification to compare health care transactions to ATM withdrawals and online purchases from J. Crew. But most U.S. consumer companies embraced the digital revolution more than a decade ago, and customers benefited tremendously. Modernizing health care is a more daunting task, but it's also 1,000 times more important (and far more difficult) than being able to purchase a sweater online.
Health plans are the central point of coordination between all major parties in health care — doctors, hospitals, employers and consumers. That's why it's incumbent upon health plans to drive online communication and coordination. An obvious place to start is by creating secure, online access to information about benefits, claims payments, and medical histories — and by allowing consumers, physicians, and others to conduct self-service online, 24 hours a day. Many health plans have already launched Internet initiatives to improve customer service and lower overhead costs. But many have not. And that's not acceptable.
At least I know how to direct my own care and pay my bills, given a chronic illness and a long career in health care. And at least my PPO plan provides some basic structure. But what about Joe Citizen who signs up for one of these new "consumer-driven" benefit plans offered by his employer?
Employers faced with double-digit rate increases are once again searching for ways to tame the health care tiger without returning to the onerous restrictions of the past. The solution du jour is to shift more responsibility for the cost of care onto employees. One model, the defined-contribution plan, allows consumers to use a fixed amount of money from their employer to mix and match plan features to suit their personal priorities. Consumers use their own money to upgrade benefits or pay for additional health expenses.
Consumers have played an unwitting role in this shifting of costs by demanding more choice and less "management" of their care. But they may not like what they get when they begin picking up even more of the tab and navigating their own way through our Byzantine, overwhelming health care system. In response, they will turn to an unlikely ally for guidance and support: managed care.
Managed care is a long way from being health care's knight in shining armor, but it has certainly learned how to pick its battles. For example, most health plans dropped routine specialist referrals and test authorizations after discovering they were merely rubber-stamping the majority of requests and irritating a lot of people in the process. The industry has also responded to consumers by building more flexible benefits. Today, many health plans allow members to see any doctor they choose, by offering benefits with lower out-of-pocket costs for contract physicians and higher costs for those outside the network.
Managed care has evolved over the years, but that's rarely acknowledged by the pundits who eagerly proclaim its demise.
True, managed care has fallen from favor, but it is far from dead. Further, consumer interests and managed care are not diametrically opposed. Managed care's founding principles — to offer an organized, affordable system of care, including disease prevention and management of chronic illness — should have renewed appeal for today's consumers, who are increasingly "on their own" in health care.
Prior to managed care, there was zero assistance for consumers. Doctors know medicine best, but most people don't know the difference between a philatelist, a podiatrist, and a philanthropist. If you hurt your knee, what type of doctor should you see? Your family physician? An orthopedic surgeon? A sports medicine specialist? And if the doctor says you need surgery, a little voice in the back of your head wonders whether you really need it. Under "consumer-driven" plans, too, you'll have to do your own research to learn if your injured knee requires surgery.
Managed care's most enduring value has been the creation of an organized system that includes packaged benefit plans, networks of doctors and hospitals that are pre-screened, and medical-treatment guidelines. This structure allows the consumer to be in control without having to go it alone. But managed care can do so much more. Consider my do-it-yourself trip to the ER.
There is no reason why any of us should have to fill out papers over and over about everything from mundane demographic data — name, address, phone number — to life-preserving information about medications and previous health conditions. No reason, given the automation and information-sharing that's possible with today's technology.
The difference between managed care's debut and its second coming is this: The consumer movement will create a receptive audience for the tools and cost savings provided by managed care instead of a captive and hostile audience. And employers won't be able to hide so easily behind health plans, blaming them for rising costs and employee dissatisfaction over benefits. In turn, managed care can realize its full potential by becoming more consumer-friendly and technologically savvy.