THE MANAGED CARE THREAT

The following editorial is from Arkansas Business, a statewide business magazine. Many of the issues raised in the editorial apply to the managed care situation in Missouri.

The Governor's Health Care Reform Task Force has issued a 429-page report entitled "Health Care Reform in Arkansas." This clunker bears watching. One reason for a wary eye is that medicine in Arkansas may move in the direction the report recommends by simple default: No entity in the state has offered an alternative vision.

In a similar vacuum in the 1980s, Hillary Rodham Clinton allegedly reformed education in Arkansas. What's missing is any debate over essentials, any questioning of fundamental premises. Such one-sides policy-making may make for convenient politics, though not necessarily sound long-term policy.

If this vacuum persists in health care reform, Arkansas may wind up becoming what this report recommends; guinea pigs for the Clinton health care plan writ small.

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To better grasp what is occurring in medicine today it's helpful to resist the impulse to trot out new laws, regulations and mandates and instead examine the impact of those already in existence, particularly as they relate to Medicare and Medicaid.

After 30 years of well-intentioned federal health care programs, the blunt truth is that the government can't, or won't, pay for them. As a result of cost pressures over the years, the government has lowered Medicare reimbursement fees to doctors. Today, Medicare pays only 59 cents for services for which private insurers pay $1. The result is massive cost-shifting whereby privately insured patients pay higher prices to make up the difference.

There are other distortions in health care, but this government intervention is the tap root of today's so-called crisis.

Despite this, both President Clinton and congressional Republicans are harrumphing about further cuts in Medicare. Clinton would use the savings to help pay for universal coverage, while Republicans want to cut the deficit.

In testimony before the Physician Payment Review Committee, Dr. James S. Todd of the American Medical Association said another round of proposed cuts could leave Medicare paying just 34 percent of private payments by 2004. The result in either case, Todd says, "would be the devastation of Medicare as we and our patients know it."

To insulate themselves from cost-shifting, many corporations and individuals are turning to HMOs, PPOs, IPAs and the cleverly marketed alphabet soup of alternatives floating under the catch-all title of managed care. Some 8 percent of Arkansans are in managed care plans, and the rolls are growing. It is estimated that 50 percent of Americans will be enrolled in plans based on capitated, or per-head, rates by 2010.

Obviously, managed care differs from traditional fee-for-service medicine. In essence, it's prepayment for the rationed consumption of medical care.

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The moral high ground has been staked out by those pushing for universal coverage. Yet these same humanitarians are rather dismissive of the ethical snares of managed care.

For starters, managed care's gauntlet of peer review, utilization review and bureaucratic oversight invites medicine by committee. This is not time-tested Hippocratic medicine.

The roughly 2,400-year-old Hippocratic oath reads, "I will prescribe regiment for the good of my patients according to my ability and my judgment and never do harm to anyone." Simply put, this means physician autonomy. We finesse such absolutist creeds at our own peril. Too often in managed care it is the doctor's independent judgment being managed.

Yet in some managed care arrangements, the physician has an incentive to sell out his judgment. Doctors often are compensated according to how much money they save their managed care network. Worst of all, much of these machinations occur without the patient's knowledge. It's sobering that physician-assisted suicide is now legal in Oregon.

To its credit, the report by Arkansas' task force touches on a few ethical troubles raised by managed care:

-- Will the physician-patient relationship be altered. If so, in what way?

-- In a reformed system, with gatekeepers inherent in managed care networks, can individuals be assured freedom of choice and how?

-- Should there be an option for second opinions when there is disagreement with the primary care provider about the diagnosis and treatment recommendations?

-- Does managed care contain costs and, if so, what are the features of managed car models that result in efficiencies?

Despite these passing worries, the effect of the task force's recommendations, if implemented, would be to institutionalize managed care via the alliance system, undermine fee-for-service medicine and set up a quasi-governmental apparatus to regulate medicine as a public utility. Such a structure poses an additional question: What sort of individual will endure the hassles of practicing medicine under such a system?

Arkansans should think hard about the ethics of managed care before embarking on yet another flurry of lawmaking, mandating and regulating.