Healthcare Alternative Dispute Resolution

By Mathews, Rod | The CPA Journal, December 2003 | Go to article overview

Healthcare Alternative Dispute Resolution


Mathews, Rod, The CPA Journal


Disputes with health insurers or managed health care organizations can be bitter and complicated. The most time- and cost-efficient ways of resolving those disputes are the various forms of alternative dispute resolution (ADR), all of which are more appealing to the insured person than the courtroom option.

ADR Advantages

In general, arbitration is a more formal process than mediation. Independent, impartial, and chosen by the parties in dispute, an arbitrator is trained in the art of dispute resolution. he presides over the dispute and renders a final, binding decision. Mediation, on the other hand, is a more informal process. A mediator, chosen by the disputing parties, facilitates discussion of the dispute between them; he assists the parties in coming to their own resolution. The training and skills of a mediator are more facultative than those of an arbitrator, whose task is to preside over an orderly final disposition.

ADR's advantages are particularly attractive for healthcare disputes. When someone's well-being is at risk, time is of the essence. Delays can adversely affect outcome, and barriers to care such as cost, delay, formality, or complexity are to be avoided. Courts are seldom the most effective means of resolving disputes under these unique circumstances.

But even when a healthcare dispute is not urgent, it is unrealistic to look to the courts for effective solutions. Barriers to access, procedural delays, costs, and limitations on available remedies all serve to provide less than optimal results. Each person's health status is unique and defies standard solutions.

On the other hand, ADR-such as arbitration or mediation-is adaptable, flexible, and limited only by the creativity and expertise of the participants. Litigation's usual formalities and conventions can be avoided to suit the exigencies of the particular situation. Little capital investment or special training is required. The parties are guided, but not bound, by such court-room complexities as the rules of evidence. Specific knowledge-such as healthcare-of the arbitrator or mediator is more readily available than in the courtroom. Custom, complex solutions can be built expeditiously and at relatively low cost, with input from multiple interests and with the patient's risk level in mind. Fairness and equity are the objectives. Lawyers are not required. The courtroom's adversarial and polarizing atmosphere is abated, and the feedback that is so important for healthcare quality improvement is facilitated. As a result, ADR often facilitates access to health care.

Healthcare Issues

A closer examination of the general and health care-specific reasons to use ADR reflects why even healthcare insurers or managers favor ADR-despite the advantages these companies enjoy in the courtroom.

ADR's benefits-speed and efficiency; low cost; privacy; ease of access; informality; confidentiality; and non-precedentsetting-are compelling reasons for the parties to any dispute to be interested. Though not the same as confidentiality, privacy can be attractive when compared to the very public nature of court proceedings. Indeed, the disruptions and distractions to people and resources involved in any such contest should be more manageable under ADR.

But there are additional, unique reasons why health-care stakeholders should bring their disputes to ADR. Healthcare benefits managers, often disappoint the expectations of physicians and their patients. So, conflict is inevitable and constant. Even though the playing field has been leveled by the regulatory and political reaction to managed care, and despite the many undisputed claims that are processed daily, public skepticism, anger, and distmst about healthcare coverage and access decisions persist, fair or not. …

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