Managed Care – A Dirtied Word

By on December 19, 2011

In the public debate over our current health care crisis, managed care has become synonymous with villainy. There are some who believe that we had a perfectly good working health care delivery system in this country until some ‘geniuses’ came along and tried to substitute managed care in the 1970’s and 80’s. These discontents see Managed Care as shorthand  for “managed to separate me from the care I should be getting.” They believe the solution is to roll back all the changes that have occurred to 1976 and everything will be fine again.

Whoa! Not so fast. The reality was that it wasn’t the care that needed management, it was the cost. And the cost was driven primarily by new advances in medicine and pharmaceuticals. The names somehow got garbled.

In fact most Americans should want their medical care to be managed. Unmanaged medical care would go something like this: “I think you probably have leukemia, here is a paper bag of all the medicines on the market and a list of test you can get from the local lab and imaging center. Just reach in there and take whatever you’d like, if you’d like, when you’d like. Good luck.”

No one in their right mind wants care like that. Even when well. the intelligent patient wants to know what they can do to prevent cancer and diabetes and heart disease. They want their care managed by intelligent professionals at all times.

So why did the cost need management? Because it was going up faster than company profits, tax revenues and most importantly personal income. The per capita spending on health care in the US has risen 500% from 1970 – 2000 and has continued to rise since then. The lower 90% of US incomes were actually flat during the same time frame. The increased cost was falling onto the shoulders of employers and insurance companies and the government third party payers who started pushing back.

Managed cost measures initially surprised and angered the public. Some of the early mechanisms like prior approvals and ‘gate-keeping’ were done ham-fistedly, with more of an eye to the bottom line cost than humane considerations of the patient’s condition. Several of these practices were abandoned. Some of the early entrants into the managed care marketplace are no longer around.

But managed cost containment practices are now part of the fiscal plan every hospital, doctor, insurance company, third-party provider (your employer) and national, state, and local government’s strategies for 2012. Unless you are Donald Trump and feel you can pay for any medical procedure you will ever need out of the money in your bank account, Managed Cost efforts will be affecting you in the years to come.

Stay tuned to the discussions in Washington. This is not just political gamesmanship.


Tom Godfrey


About Tom Godfrey

18 comments on “Managed Care – A Dirtied Word

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