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When HMOs put profits over patients: managed care executives often base decisions about medical services on how they affect the company's finances. You must thoroughly understand the managed care industry to right the wrongs that put patients' lives on the line.

Article Excerpt
In today's health care system, patients suffer not only from their diseases, but also from the management of their diseases. When medicine was a cottage industry, "negligence" meant physician negligence, and physician negligence had an immediate and evident relationship to patient harm. Now patients can experience unprecedented harms through long, and often subtle, causal threads that connect them to corporate decisions.

As early as 1980, Arnold Relman, then editor of the New England Journal of Medicine, warned about the rise of a "new medical-industrial complex." (1) Paul Starr noted in his book The Social Transformation of American Medicine that the growth of corporate medicine goes beyond the increase of for-profit companies and extends to fundamental changes in their organization and behavior that affect the nonprofit sector. (2) Health care is not the same as file business of automobiles, electronics, or entertainment, yet we assume it is the same kind of market, sanctioning its pursuit of profits, efficiencies, winners, and losers. Even though the notion of a health care "market" is an abstract one, it has real consequences--as Robert Kuttner writes in his book Everything for Sale--when it is "played by individuals who are far more interested in quick returns than in maximizing the health of an enterprise for the long run." (3)

The effects of quick returns can be deadly. Health care should be produced and consumed in a special kind of exchange. Organized health care, with its power over life and death, should share responsibility for medicine's extramarket values, such as respect, compassion, and the social provision of public health.

When corporate decisions put profits over patients, the consequences of increased suffering and death are played out in the lives of real people, families, and communities. For better or worse, every decision in health care, from delivery to payment, results in some physical or emotional impact on an individual or group in our society.

Health care as business

In 1995, the regional vice president of Humana Health Insurance Co. faced a typical management problem: how to turn around an unprofitable sector of his company. Unlike other businesses, in which profits rise in proportion to an increase in products or services, a health insurance company defines success by how much its product--payment for medical claims--can be reduced.

Like any good executive, the VP looked at his company's different sectors, evaluated performance, and then shifted resources from an area of low profitability to one of higher potential. That these company sectors represented different types of patients--not widgets on a manufacturing belt--seemed to make little difference. The VP's solution called for his employees--company nurses--to terminate services to chronically ill children first. This savvy business decision resulted in serious adverse consequences to more than 100 sick children, including a Florida girl named Caitlyn Chipps.

Her father, Mark Chipps, a police officer with the Palm Beach County Sheriff's Office, subscribed to his employer's group health insurance policy with Accordia/ Anthem. On December 14, 1990, Caitlyn was born with cerebral palsy. Children with cerebral palsy require systematic and regular occupational, physical, and speech therapy, all provided under the family's group health insurance plan.

In 1993, Chipps's...

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