Business and Medicine at the Crossroads: An Ethical Assessment of for-Profit Managed Care

Dissertation, University of Southern California (1997)

The emergence of managed health care, especially when delivered by for-profit corporations, has prompted moral concerns over harm to patients. Critics allege that these organizations cannot properly honor their traditional medical role of healing patients, while attempting to honor their business obligations since it will be tempting to withhold necessary care in order to increase profits. ;While this issue has generated an emotional public response, the literature addressing the ethical implications of managed care is still in its infancy. Particularly notable is the dearth of scholarly efforts which properly address organizational ethics and responsibilities. In the few attempts which have been made to formulate an ethical framework for these organizations, they have usually been grounded in either traditional medical ethics or laissez-faire business models. As a result, important interests have been ignored. ;Based upon the conceptions of justice developed by John Rawls, this dissertation engages in a normative ethical analysis of the role of for-profit organizations in the delivery of managed care. In addition, an ethical framework with which to form specific behavioral guidelines and to draw social policy implications will be developed. ;I begin by assessing managed care in light of the available alternatives for medical delivery: fee-for-service arrangements, explicit rationing proposals, and the use of medical savings accounts. From this assessment, it can be seen that managed care is the most viable alternative given current constraints. I then proceed to a perform a systematic comparison of for-profit versus non-profit managed care models. I find that the two models are quite similar to the degree to which they can serve patient and societal interests. As a result, my argument is that for-profit models are morally viable entities in health care reform. However, my contention is that these organizations are only acceptable if they operate within an ethical framework which properly accounts for both their business and medical roles and serves to guide their behaviors in a manner that properly protects patients and societal interests. I conclude by developing such a model and delineating its organizational ethics and social policy implications.
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