Regulating Managed Care: Theory, Practice, and Future Options

By Stuart H. Altman; Uwe E. Reinhardt et al. | Go to book overview

Chapter Three
Mark Pauly and Marc L. Berger

Why Should Managed
Care Be Regulated?

The economic metamorphosis of private health insurance in a little more than a decade has been accompanied by an equally amazing political transformation. Managed care went from bipartisan embrace to near-universal scorn, attacked in both state and federal capitals by populist politicians, targeted by physician associations of the left and the right, and subject to critical exposés nightly on national TV.

We share the general predisposition of most Americans toward reliance on private markets rather than government to allocate resources for the production of goods and services. Health care, of course, is fundamentally different from other goods and services, but we postulate that markets ought to drive allocation of medical care services if they function well or can be made to function well (assuming government makes transfers to help those unable to afford as much care as society deems appropriate).

Because state and federal governments thus far have not provided as large a transfer as needed to achieve universal health insurance coverage, the sociopolitical problem of the uninsured regrettably has not been much affected one way or another by the managed care revolution.

The users of privately financed managed care so far have been overwhelmingly the middle-class (upper and lower) nonelderly, and so it is to their welfare that we should look in evaluating the effects of managed care and possible regulatory interventions. We

-53-

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Regulating Managed Care: Theory, Practice, and Future Options
Table of contents

Table of contents

  • Title Page *
  • Contents vii
  • Foreword ix
  • Acknowledgments xiii
  • The Editors xv
  • The Contributors xvii
  • Introduction - The Philosophy of Regulation xxi
  • Notes xxxii
  • Regulating Managed Care xxxiv
  • Section I - The Role of Regulation in a Market-Oriented Health Care System 1
  • Chapter One - An Overview 5
  • Notes 27
  • Chapter Two - The Current Status of State and Federal Regulation 29
  • References 51
  • Chapter Three - Why Should Managed Care Be Regulated? 53
  • Chapter Four - Macro-Versus Microregulation 75
  • Reference 85
  • Section II - Regulatory Issues 87
  • Chapter Five - Consumer Choice Under “private Health Care Regulation” 91
  • Notes 114
  • Chapter Six - A Model for Health Care Consumers 117
  • Notes 133
  • Reference 133
  • Chapter Seven - Ensuring Equal Access to Care 135
  • Notes 143
  • Chapter Eight - Regulating Quality and Clinical Practice 145
  • Chapter Nine - The Scope of Managed Care Liability 160
  • Notes 185
  • Reference 186
  • Chapter Ten - Erisa and the Regulation of Group Health Plans 189
  • Notes 200
  • References 203
  • Section III - Perspectives on Regulation 205
  • Chapter Eleven - Understanding the Managed Care Backlash 209
  • Notes 224
  • Chapter Twelve - Core Principles for Regulating Health Care Quality 229
  • Notes 237
  • Chapter Thirteen - Balancing Market Forces and Regulation 239
  • Notes 262
  • Chapter Fourteen - Regulation from a Consumer's Perspective 263
  • Notes 274
  • Chapter Fifteen - Regulation from an Insurance Industry Perspective 276
  • Notes 281
  • Chapter Sixteen - Regulation Misses the Big Issue—the Uninsured 282
  • Notes 297
  • Section IV - Managed Care Regulation in Practice 299
  • Chapter Seventeen - A Practical Approach 301
  • Chapter Eighteen - California's Struggle with Regulation 312
  • Notes 329
  • Chapter Nineteen - How the Estimates Vary 331
  • Notes 343
  • Index 345
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