Abstract

The increased competition for a share of the market of insured patients, which arose in the wake of failed comprehensive health care reform, has provoked questions about what, if any, standards will govern new “competitive” health care organizations. Managed care arrangements, which typically shift to providers and patients some or all of the financial risk for patient care, are of special concern because they can create incentives to withhold beneficial care from patients. Of course, fee-for-service medical practice creates incentives to provide unnecessary services, and managed care can avoid that type of harm. Still, as Edmund Pellegrino has noted, “managed care, by its nature, places the good of the patient into conflict with … the good of all the other patients served by the plan; the good of the plan and the organization, themselves…; and the self-interest of the physician.