Cost-Cutting Essential to Managed Care
Carter G. Phillips, the attorney representing Carle Clinic, says financial incentives are necessary to keep costs in check, but they should not prevent doctors from carrying out their professional duty to patients. "It seemed pretty clear under the 7th Circuit decision any managed care program would have a hard time surviving. If we lose, it will affect how managed care does business in a very fundamental way," he says.
Judging from their questions during oral arguments, the Supreme Court justices appeared to side with the HMO. Ginzkey, for one, attributes the justices' leanings to their lack of judicial ?- and personal -- experience with managed care. Justice Sandra Day O'Connor asked pointedly: "Why should the courts get involved in this messy business" of deciding whether some financial incentives go too far? Justice David H. Souter noted that HMOs and their employees have a strong financial interest to hold down costs. "Unless they do so, the HMO will go out of business," he said.
Herdrich, who is no longer in an HMO, has a hard time believing that her case has come this far. "When I heard the U.S. Supreme Court would hear the case, my reaction was 'Oh, no.' It's overwhelming to realize a decision on my case could affect so many people."
Although she can't receive monetary damages from the HMO, pursuing the case is worth it, she says. "I've talked with a number of people who've had worse experiences with their HMOs, who've lost spouses or children. I'm thankful that I survived."
Loren Stein, a journalist based in Palo Alto, Calif., specializes in health and legal issues. Her work has appeared in California Lawyer, Hippocrates, L.A. Weekly, and The Christian Science Monitor, among other publications.