Shannon Brownlee explains why HMOs are superior:
Words matter in health care politics, and the confusion around the terms "managed care" and "HMOs" (health maintenance organizations) perfectly illustrates why. I don't think managed care has a prayer of being more efficient than our current fragmented system. I do think HMOs are superior, and any serious student of American health care policy, and Arnold Kling is clearly one of them, needs to know the difference.There are only a few real HMOs in the U.S., the best known being Kaiser Permanente, which is based in northern California, and Group Health of Puget Sound, in Seattle. A cousin of the HMO, the salaried group practice, is only a bit more common, with notable examples being the Mayo Clinic in Rochester, Minn., and the Marshfield Clinic in Wisconsin. These two types of organizations share several key qualities. First, their physicians are salaried, though they differ in how they get paid. HMOs are "prepaid" -- they are provider and payer rolled into one. Group practices bill insurers as if they were fee-for-service providers, but they divvy the receipts among their salaried physicians, thus insulating physicians to some degree from the financial incentive to overtreat patients.
Read the rest (and comment) here. --The Editors
