We pose the question: Is consumer sovereignty in the healthcare market fact or fiction? Consumer sovereignty in healthcare implies that society benefits at large when healthcare organizations compete to develop high quality healthcare products while reducing the cost of doing business (reflected in low prices), and when consumers choose wisely among healthcare products by purchasing those high quality products at low prices. We develop a theoretical model that encourages systematic empirical research to investigate whether consumer sovereignty in healthcare is fact (...) or fiction. In doing so, we develop a series of theoretical propositions that may demonstrate that consumer sovereignty is more fiction than fact. Specifically, healthcare consumers lack the ability, motivation, and opportunity to choose healthcare products that are high in quality and low in price. Similarly, healthcare firms lack the ability, motivation, and opportunity to compete in ways to develop and market higher quality products at lower prices. (shrink)

The case for U.S. health system reform aimed at achieving wider insurance coverage in the population and disciplining the growth of costs is fundamentally a moral case, grounded in two principles: (1) a principle of social justice, the Just Sharing of the costs of illness, and (2) a related principle of fairness, the Prevention of Free‐Riding. These principles generate an argument for universal access to basic care when applied to two existing facts: the phenomenon of “market failure” in health insurance (...) and, in the U.S., the existing legal guarantee of access to emergency care. The principles are widely shared in U.S. moral culture by conservatives and liberals alike. Similarly, across the political spectrum, the fact of market failure is not contested (though it is sometimes ignored), and the guarantee of access to emergency care is rarely challenged. The conclusion generated by the principles is not only that insurance for a basic minimum of care should be mandatory but that the scope of that care should be lean, efficient, and constrained in its cost. -/- . (shrink)

Following the seemingly endless debate over managed care liability, I cannot suppress thoughts of Yeats’s poem, “The Second Coming.” It is not the wellknown phrase, “Things fall apart; the centre cannot hold,” that comes to mind; although that could describe the feeling of a health-care system unraveling. The poem’s depiction of lost innocence — “The best lack all conviction, while the worst/Are full of passionate intensity” — does not allude to the legislature, the industry, the public, or the medical or (...) legal profession. What resonates is the poem’s evocation of humanity’s cyclical history of expectation and disappointment, with ideas as grand as justice and occupations as pedestrian as managed care. Writing in 1919, Yeats described the end of an era with images of war’s destructive forces. The poem expresses a universal desire for some miraculous rebirth or resolution of all problems: “Surely some revelation is at hand.” But instead, the brutish Sphinx-like creature emerges, possibly the Antichrist. New gods displace old gods in the cycle of civilization, and man must muddle on. (shrink)

Following the seemingly endless debate over managed care liability, I cannot suppress thoughts of Yeats’s poem, “The Second Coming.” It is not the wellknown phrase, “Things fall apart; the centre cannot hold,” that comes to mind; although that could describe the feeling of a health-care system unraveling. The poem’s depiction of lost innocence — “The best lack all conviction, while the worst/Are full of passionate intensity” — does not allude to the legislature, the industry, the public, or the medical or (...) legal profession. What resonates is the poem’s evocation of humanity’s cyclical history of expectation and disappointment, with ideas as grand as justice and occupations as pedestrian as managed care. Writing in 1919, Yeats described the end of an era with images of war’s destructive forces. The poem expresses a universal desire for some miraculous rebirth or resolution of all problems: “Surely some revelation is at hand.” But instead, the brutish Sphinx-like creature emerges, possibly the Antichrist. New gods displace old gods in the cycle of civilization, and man must muddle on. (shrink)

Health care costs have been rising steadily in most industrialized countries. These increases are driven primarily by technological advances and, to a lesser degree, by aging of the population. Many factors make it unlikely that market forces alone will limit increases in the costs of health care. These unremitting increases make health care rationing appear both necessary and inevitable.One of the least controversial mechanisms for rationing could be to allow patients to make their own choices as to which kinds of (...) care they would be willing to forgo. This is appealing because it preserves individual freedom of choice regarding health care in a way that other rationing mechanisms often do not. Rationing by patient choice, however, can only happen if patients recognize that resources are limited and need to be conserved, and are willing to forgo marginal benefits. (shrink)

It is often claimed that managed care organizations involve physicians in conflicts of interest by creating financial incentives for physicians to refrain from ordering treatments or making referrals. Such incentives, the argument goes, force the physician to balance the patient's health interests against the MCO's interests and the physician's own financial interest. I assume, for the sake of argument, that such arrangements at least provide reason to believe that physicians in MCOs are involved in conflicts of interest. Two approaches have (...) evolved for dealing with these conflicts. On one approach, MCOs disclose the financial arrangements under which their physicians work so that patients can consent to the managed care plan and thereby to the plan's limitations. The chief proponent of this approach is Mark Hall, whose recent book Making Medical Spending Decisions applies prior consent to a variety of decisions regarding medical financing and allocation. The other approach is simply to forbid conflicts of interest through regulations. (shrink)

It is often claimed that managed care organizations involve physicians in conflicts of interest by creating financial incentives for physicians to refrain from ordering treatments or making referrals. Such incentives, the argument goes, force the physician to balance the patient's health interests against the MCO's interests and the physician's own financial interest. I assume, for the sake of argument, that such arrangements at least provide reason to believe that physicians in MCOs are involved in conflicts of interest. Two approaches have (...) evolved for dealing with these conflicts. On one approach, MCOs disclose the financial arrangements under which their physicians work so that patients can consent to the managed care plan and thereby to the plan's limitations. The chief proponent of this approach is Mark Hall, whose recent book Making Medical Spending Decisions applies prior consent to a variety of decisions regarding medical financing and allocation. The other approach is simply to forbid conflicts of interest through regulations. (shrink)

The American Journal of Bioethics, Volume 12, Issue 3, Page 37-39, March 2012.

Changes in healthcare financing increasingly rely upon patient cost-sharing to control escalating healthcare expenditures. These changes raise new challenges for physicians that are different from those that arose either under managed care or traditional indemnity insurance. Historically, there have been two distinct bases for arguing that physicians should not consider costs in their clinical decisions—an “aspirational ethic” that exhorts physicians to treat all patients the same regardless of their ability to pay, and an “agency ethic” that calls on physicians to (...) be trustworthy advisors to their patients. In the setting of greater patient cost-sharing, physicians' aspiration and agency roles increasingly conflict. Satisfactorily navigating the new terrain of consumer-driven healthcare requires physicians to consider these two roles and how they can best be reconciled so as to maximize quality of care while respecting the heterogeneity of patients' financial resources and willingness to pay. (shrink)