Regulating Managed Care: Theory, Practice, and Future Options

As opposed to the broad perspective on regulation provided in Section One, this second section focuses on specific regulatory measures. Consumer choice, rights of grievance and appeal, access to services, standards of quality, and health plan liability are the topics addressed.

Uwe Reinhardt begins this section by observing that the consumer choice model of managed competition has thus far failed to emerge. He notes that a public that previously rejected government intervention in health care has now changed its mind as consumers find their choices circumscribed by “private health care regulators.” In theory, he points out, purchasers were supposed to be presented with a variety of competitive health plans and sufficient information to make informed choices. But neither the choice nor the information has been made available to most consumers. Reinhardt urges public funding to support research and development of health performance measures. He suggests that government support is needed to organize the provision of information on quality measures and consumer satisfaction into a kind of farmers market similar to that envisioned by the architects of managed competition.

Advocates for consumer protection often recommend establishing an ombudsman program to help consumers deal with a complex and fast-changing health care system. William Benson is an expert on the long-term care ombudsman program and recommends it as a model for the health care industry. Benson identifies the most important features of the long-term care program, and explains why these features should be incorporated into a

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