Shannon Brownlee explains the differences between managed care and (real) HMOs/group practices, and tries to rescue the shattered reputation of the latter:
The reason group practices and HMOs haven't flourished is that the market isn't set up to pay them. There isn't an insurer in this country, including Medicare, which consistently pays doctors and hospitals for the quality of care they provide. They pay for quantity. They pay for the volume of individual services provided, not for the value of those services to the patient. As Michael Hillman of the Marshfield Clinic (a group practice in Marshfield, Wisconsin) recently put it, our current payment system "is like buying a car based on how many parts it has and how long it takes to make it, without considering how well it runs.'' So even though HMOs and group practices have in effect built the equivalent of a better car, the market doesn't give a rip.
Patients don't care either, partly because they are insulated from the cost of medicine, so they have little stake in getting good value for their dollar. But they also have a bias against HMOs and group practices because the American Medical Association has spent the last century telling them that HMOs and group practices offer inferior care. The AMA's rallying cry has been the almighty "doctor-patient relationship." This might sound like a motto based on the needs of patients, but what it has meant in practice is the AMA has trumpeted the rights of individual doctors in private practice to treat patients as they see fit, without interference from the government or their peers, and more importantly, to charge whatever price the market will bear. According to the AMA anything that resembles organized medicine, including group practices and Medicare, is a Commie plot to saddle us with socialized medicine -- and constrain physician incomes.
Doesn't ring true? Think about this: HMOs came into being largely in order to better coordinate care. Much like the VA, they bring together doctors who're jointly tasked with individual patients, who share notes and generally work as a team. That's part of how they keep costs down. Now, all of you, just about, are in the Big Insurance version of the HMO: Managed care. How coordinated does your care feel?
