MeHarry Medical College,
Journal of Health Care For The Poor And Undeserved, Volume 5,
Number 3, 1994.
This journal memorializes several timely presentations at the
Sixth National Conference on Health Care for the Poor and
Undeserved in Nashville, Tennessee. The topic of the conference
was managed care. While not all of the presentations will be
summarized herein, they are very informative and worthy of
review. The journal categorizes the presentations by providing:
an overview of managed car;, the impact of managed care on
Medicaid; issues of quality in managed care; the economics of
managed care; and training implications for managed care. The
following excerpts provide some insight into the interesting
issues that were covered at the conference. [back]
Mark D. Smith, MD, MBA, Managed
Care And The Poor, Journal of Health Care for the Poor and
Under served, vol.5, No.3, page 147, 1994.
In a presentation entitled, Managed Care and the Poor,
Mark D. Smith, MD, MBA, provides a candid introduction to his
opinion about what he sees as the realities involving managed
care organizations. More specifically, he discusses the
importance of refining managed care, so that the interests of
government, big business, the middle class and the poor will be
served. He addresses four issues that are heavily involved in the
debate over managed care. They include: cost-sharing; prevention;
traditional providers for the poor; and premium adjustment.
Cost-sharing provides patients with a comprehensive benefits
package that covers many procedures as long as a recipient
complies with the rules of the plan. Failure to comply results in
the penalty of non-payment by the plan. This method of managed
care presumes that people have discretionary money to pay for
health care services. This assumption overlooks the poor, who do
not have discretionary income. Providing more preventive services
is a fundamental theme of managed care. However, in reality, many
members of managed care organizations are not receiving
preventive care. The third issue, traditional providers for the
poor, addresses the future of minority physicians, Community
Health Centers, and minority teaching hospitals. Minority
physicians are having a very difficult time joining managed care
organizations because of racist and exclusionary membership
requirements. These requirements threaten the ability of minority
physicians to compete. Finally, poor patients with chronic
illnesses are less likely to receive services, because managed
care organizations prefer to enroll healthy patients as a cost
saving measure. Managed care is not concerned with the needs of
the poor, but their needs must be addressed. [back
Ronald Horn, MD, Managed
Care: Implications For Under Represented Physicians, Journal
of Health Care for the Poor and Under Served, Vol.5, No.3, Page
In this paper, Dr. Horn identifies recent health care trends
and their impact on under-represented physicians,(1)
and recommend ways of handling the changes that will occur in
health care. Specifically, Dr. Horn believes that managed care
will impact the health care industry in the following ways: there
will be an increase in the number of primary care physicians;
primary care physician salaries will increase to attract more
medical students and resident; HMOs will recruit primary care
physicians heavily; planning for health care in the further will
be a more comprehensive process, combining health care and
insurance to ensure universal access, cost containment, and
quality; cost-shifting to patients in the plan will be
eliminated; physicians and administrators will be open to
liability; the administration of the plans will be uniform;
physicians in private practice will be forced to join group
practices or HMOs; solo or small group practitioners will have
difficulty competing with the larger entities; only board
certified physicians will be allowed to join managed care
organizations and joining will become very competitive;
physician-patient relationships will be jeopardized by the
gatekeeper mechanisms the managed care organizations require; and
good middle aged physicians may retire early or change careers.(2)
All of these changes severely threaten the Black community
because under-represented physicians -- women, Blacks, and other
minorities -- "make up a large percentage of primary care
specialties, although the numbers of Blacks and other minorities
entering primary care fields" is decreasing.(3)
In addition, minority medical school graduates traditionally
intend to practice in their communities. However, for many
economic reasons that relate to cost-effectiveness and because of
the demanding medical needs of the Black community, managed care
organizations will probably reduce the number of Black physicians
Consequently, Dr. Horn recommends that the recruitment and
retention of under-represented medical school students must
increase, to increase the number of under-represented physicians.
Under-represented physicians must involve themselves in the
management of the managed care organizations.(5)
In addition, under-represented physicians must meet all of the
eligibility requirements of managed care organizations -- i.e.
achieving board certification. Finally, private practitioners
should join larger practice groups in order to compete for
managed care contracts.(6) [back]
Thomas P. Weil, PhD, Managed
Competition For The Poor: More Promise Than Value?, Journal
of Health Care for the Poor and Under Served, Vol.5, No.3, Page
The article explains the concept of managed competition.
Managed competition is different than managed care in that it
shifts the focus from "amenities and perceived quality to
measured differences in price and in outcomes of patient
The author stresses the point that the results of the
involvement in the health care industry of Medicaid recipients,
report higher costs than fee-for service arrangements. This
complicates the ability to incorporate under-represented groups
into the managed competition process because their needs are
considered counter-productive by managed competition systems.(8)
The author proposes a progressive, yet idealistic solution -
linking global budgetary targets and social equity. [back]
Randall, Impact of Managed Care Organizations on Ethnic
Americans and Undeserved Population, Journal of Health Care
for the Poor and Under Served, Vol.5, No.3, Page 224, 1994.
Dr. Randall begins her article with a few anecdotes that
illustrate the inequities between having adequate health
insurance and receiving adequate health care.(9)
This inequity is largely caused by managed care organizations
(HMOs, PPOs, IPAs) rationing patient care. The fundamental
purpose of managed care organizations is cost saving through
strict utilization review and financial risk-shifting.(10)
These cost saving mechanisms may have an adverse impact on the
health status of ethnic and undeserved populations.(11)
Furthermore, physicians will be required to act as
"gatekeepers", limiting overutilization of recommended
It has been demonstrated that ethnic Americans underutilize,
rather than over-utilize, health care services. This
underutilization combined with poorer health status, mean that
providing quality health care to these groups will be costly
which undermines the purpose of managed care.(13)
However, this undermining is also attributable to the fact that
managed care does not incorporate multi-cultural perspectives
into its cost savings plan. Without these perspectives, it can
never effectively improve the health care status of ethnic or
This article goes on to discuss managed care organizations and
health care reform. Statistics have proven that lower-income
individuals or families pay higher out-of-pocket costs than
lower-income families.(15) One
reason for this discrepancy is that health care has not been
rationed for those how have the ability to pay.(16)
The next section focuses on utilization review, financial
risk-shifting and the affect they will have on the needs of
ethnic Americans. Managed care will perpetuate existing
disparities among these groups if not monitored correctly.(17)
In addition, the standards used to measure managed care outcomes
are not representative of ethnic Americans, and must be changed
to accommodate culturally relevant care.(18)
The Impact Of
Managed Care On Doctors Who Serve Poor And Minority Patients,
108 Harv. L.Rev. 1625 (1995).
This article discusses the current efforts of state
governments toward utilizing HMOs as the main source of health
care instead of fee-for-service. It further focuses on the
transformation from fee-for-service to managed care has caused
"managed care groups ro recruit physicians based on
selection criteria that undervalue the work of doctors who serve
large numbers of poor and minority patients - patients who
generally require costlier health care." (19)
It is anticipated that these minority doctors are made extremely
vulnerable under the HMO system and may be eliminated.(20)
Their elimination will mean that the quality of health care
delivered to disadvantaged and poor communities will be impaired
and health care costs will increase.(21)
The first part of this article evaluates the disproportionate
impact the lack of regulation will have on minority physicians
and physicians who serve poor and minority communities.(22)
This sections considers issues race and socio-economic status in
relation to minority doctors, and concludes that the
transformation of health care to managed care will result in
racial discrimination against minority doctors. This
discrimination is largely because these physicians serve people
who are considered to be undesirable to HMOs because they are
sicker and more costly then other patients.
The second part of this article evaluates "the
consequences of the disproportionate exclusion of both minority
providers and providers who serve poor and minority patients from
disproportionate impact will cause many of these providers to
leave the health care industry, which will cause the quality of
health care received by their patients to be reduced. This is a
senseless consequence, especially for Medicaid HMOs who primarily
service recipients of state (24)funding
who are poor and members of minority groups.
The final part of this articles addresses remedies for the
disproportionate impact on minority doctors. These remedies
reflect both the "prejudice against minority providers and
the systematic exclusion of providers who serve poor and minority
populations,"(25) and focus
on the establishment of new laws that will ensure quality,
monitor doctor- HMO relationships and "ensure adequate
representation of minority physicians and other physicians"
serving these communities.(26)
Surprisingly, Title VII is not among the available remedies. [back]
Randall, et. al., SECTION 1115 MEDICAID WAIVERS:
CRITIQUING THE STATE APPLICATIONS, 26 Seton Hall L.Rev. 1069.
This article begins by introducing the definition of managed
care as "a health delivery system designed to cut cost by
eliminating 'unnecessary care"(27)
and emphasizes the need for managed care organizations to be
carefully designed to prevent "an adverse impact on quality
of care and patient rights."(28)
While state Medicaid reform measures such as Section 1115 waivers
appear to improve on the recipients access to health care, they
actually may not remove nonfinancial obstacles and may result in
the perpetuation of institutional racism that already exists in
the health care system.(29)
This article continues by providing a history of the Medicaid
system beginning with the enactment of Title XI in 1964. This
section also draws a nexus between federal and state funding for
Medicaid and the increasingly high expense associated with it.(30)
The article continues on by providing an overview of state
section 1115 waivers in seven states, including: Florida; Hawaii;
Illinois; Missouri; New York; Oregon; and Tennessee. The purpose
of the assessment of the waivers in these states is to determine
if their effectiveness in improving upon the legitimate Medicaid
objectives or whether they disadvantage the recipients.(31)
Within this analysis of the changes brought about by the waivers,
this article evaluates: the eligibility requirements; the
benefits; the cost sharing requirements; the treatment of
providers; changes in managed care; the treatment of special
populations; the amount duration and scope of the covered
services; categorical eligibility; upper income eligibility
limitations; waiver of income deeming rules; HMO enrollment
composition; Hospice treatment limits; Freedom of Choice; UPSTATE
treatment services; utilization and quality care review; and many
other relevant elements of the waiver requirements.(32)
This article proceeds by defining access to care and giving a
comprehensive explanation of: adequate provider fees(33);
the availability of services across the state(34);
comparability requirements; sufficient services.(35)
Next, the financial barriers and nonfinancial barriers to health
care are reviewed. The nonfinancial barriers include: language;
socio-cultural patient perspectives; insufficient health care
resources; and racism.(36) Next
the article provides a critique of the waivers to determine
whether they provide:" (1) mechanisms for recipients to
maintain their existing patient-provider relationships; (2)
standards by which health care plans will be evaluated to
determine whether recipients have adequate access; (3) for the
availability of 'Culturally Competent health care; (4) for
adequate case management and continuity of care; (5) for adequate
provider participation including providers of color; (6) for
comprehensive health care services; and (7) allow for cost
sharing which might be a financial barrier to health care."(37)
The articles concludes with a summation of the faults
associated with the state waivers in the areas of access to
health care, quality assurance; and cost containment, in spite of
the positive appearance of them on paper. [back]
Trubek & Elizabeth A. Hoffman, SYMPOSIUM: VITAL ISSUES IN
NATIONAL HEALTH CARE REFORM: ARTICLE: SEARCHING FOR A BALANCE IN
UNIVERSAL HEALTH CARE REFORM: PROTECTION FOR THE DISENFRANCHISED
CONSUMER, 43 DePaul L.Rev. 1081.
This article provides an analysis of the negative effect that
managed cares cost-saving measures have on the poors access to
health care. It focuses on the strength f the disenfranchised
consumer. "The category of disenfranchised consumers
includes those consumers who suffer from a marginalization which
prevents them from becoming full members of society."(38)
"Consumers who are considered disenfranchised in the health
care system include persons with Acquired Immune Deficiency
Syndrome ("AIDS") or Human Immunodeficiency Virus
("HIV"), the mentally and physically disabled, women of
color, the poor, and children."(39)
These consumers wish to secure health care that caters to their
particular needs. They believe that universal coverage, quality
health care for all consumers, is too broad and does not
adequately represent their needs. However, the authors believe
that universal coverage is essential because "in order to
have universal coverage, there must be a coordinated system to
allocate the resources and ensure that everyone is part of the
system."(40) While the
United States does not currently have a universal health care
system, the authors believe that such a comprehensive system
would reduce the negative stigma of undesirability on the
disenfranchised.(41) This is just
one example of the positive effect a universal system could have
on the disenfranchised. They currently complain about the legal
and regulatory support, having a political base, and receiving
the support of competent providers.(42)
The article continues by conducting an analysis of the health
care needs of each disenfranchised group and makes the point that
without comprehensive accommodation of each groups needs, the
universal system will not be effective.(43)
This section of the article concludes by stating that each of the
disenfranchised consumer groups collectively present an agenda
for health care reform that focuses on "prevention, priority
to community based and culturally sensitive providers, a
non-hierarchical arrangement which gives all health care
providers status and recognition, maintaining patient health as
opposed to curing their diseases, patient control and education,
and an understanding of the patient in the socio-economic and
The article concludes by stating that specifying the needs of
disenfranchised consumers will strengthen health care reform
R. Randall, DOES CLINTONS HEALTH CARE REFORM PROPOSAL ENSURE
EQUALITY OF HEALTH CARE FOR ETHNIC AMERICANS AND THE POOR?,
60 Brooklyn L.Rev. 167.
proposed the Health Security Act (HSA) on November 20, 1993 in
response to "concerns about the uninsured and under-insured,
about uncompensated care and about cost containment."(46)
This article addresses the effectiveness of the HSA in
resolving the economic inequities in the distribution of health
care. It also addresses the other social inequities that affect
ethnic minorities in the health care system and states that
health care reform, ultimately, must be evaluated on how
effectively it removes (or at least, significantly reduces)
barriers to (e)qual(ity) health care.(47)
This article uses the HSA as a basis for analyzing the potential
for health care reform to improve access to health care for
ethnic Americans.(48) The authors
analysis includes a description of the HSA as a bill that sets
forth the framework for a national health care system.
It continues by reviewing the structure of the HSA, and the
coverage and benefits it proposes.(49)
Part II of this article addresses the ideologically flawed nature
of the HSA. Dr. Randall asserts that by framing the HSA in a
manner that appeals to middle class Americans, the needs of the
poor and ethnic Americans are not being met and are undermined
because it fails to deal with issues like race, culture and
class.(50) These stated
ideological goals of the HSA amount to nothing more than
political rhetoric and do not address improved health status of
Americans.(51) Part III of the
article addresses how the HSA perpetuates an inadequate and
fragmented health care system that makes no provision for the
preservation or modification of the public health structure for
delivery of services.(52)
Finally, this article concludes that HSA will not improve the
health care status of ethnic Americans and the poor because
"it maintains a structurally and ideologically flawed
system; it perpetuates a fragmented system with inadequate
infrastructure; it maintains a culturally incompetent system
based on illness care; it rations health care through a tiered
system based on private interests; and it inadequately protects
against health care discrimination."(53)
D. Watson, Health Care In The Inner City: Asking The Right
Question, 71 N.C.L. Rev. 1647 (1993).
introduces the issues discussed in the Symposium and begins with
the problem of access to quality health care with a story about
June Kirchik, a poor woman with breast cancer who cannot get
treatment from public hospitals and eventually dies. Next, the
article discusses the problem of race and health care, focusing
on the difficulty inner city African American's have because of
racial, poverty and geographic barriers to health care. The high
poverty rate among African Americans directly correlates with
health care discrimination based on race.(54)
Statistics show that "only about half of all Blacks
have private health insurance; one in five have Medicaid or
Medicare; and one in five have no health coverage."(55)
"Blacks are 50 percent more likely than whites to have no
health insurance and 5 times as likely to be covered by
inner city Blacks have greater health care needs because they are
exposed to more environmental pollution than suburban dwellers.
They are exposed to the following environmental health hazards:
bad air; polluted water; crime; and drugs. As a result, they
suffer from the following conditions at a higher rate than people
living in the suburbs: hypertension; heart disease; chronic
bronchitis, emphysema; sight and hearing impairments; cancer; and
congenital anomalies.(57) This is
just a sample of the comprehensive examples of the condition of
inner-city Blacks as related to health care.
suggests several things that would improve health care for Black
inner-city residents that compliments the proposal of the Kerner
Commission, including: providing jobs; increasing incomes and
improving socio-economic status.(58)
"Good health correlates primarily with higher
socio-economic status; poor health correlates directly with
socio-economic goals are further discussed by the other
contributors to this Symposium. However, Watson does state that
in order for any reform effort for minorities to be effective,
the following four issues must be addresses: (1) health care
financing; (2) attracting sufficient health care providers into
the inner city; (3) combating discrimination in the delivery of
health care, and (4) developing new health care delivery systems
responsive to the needs of inner city residents.(60)
certain characteristics must be included in the reform package
for improvements to occur, including: universal coverage for all
residents ; comprehensive coverage of preventive and primary
health care; no serious financial barriers to participation; and
provider reimbursement rates for any public system comparable to
those of privately provided insurance.(61)
The article goes on to identify and discuss methods of attracting
providers as well as to discuss the feasibility of civil rights
enforcement of health care discrimination against inner-city
Blacks. Finally, the article candidly concludes that increasing
access to health care, by itself, will not improve the health
status of inner-city Blacks. Other socio-economic strategies need
to be implemented to ensure that the health of poor inner-city
minorities is improved. [back]
McGinley, ASPIRATIONS AND REALITY IN THE LAW AND POLITICS OF
HEALTH CARE REFORM: EXAMINING ASYMPOSIUM ON (E)QUAL(ITY) CARE FOR
THE POOR, 60 Brooklyn L. Rev. 7, (1994).
This article is
part of a symposium sponsored by Brooklyn Law entitled, Ensuring
(E)qual(ity)Health Care for Poor Americans. It begins with a
story of a pregnant woman who had no insurance, no money, no
prenatal care, and whom the local private hospital did not want
to admit. From this story, the article introduces the reality
that health care for the poor is neither equal nor quality.
Medicaid is not extended to all poor people.(62)
In addition, public hospital emergency rooms are only required to
perform a standard screening, not full treatment of a patient.(63)
These hospitals are also moving out of the inner-city areas
rapidly. This leaves many of the sick poor untreated and
This article goes
on to "begin a dialogue toward change" by setting out a
brief history leading up to health care reform becoming a
priority. (65) Due to the fact
that the middle class was receiving insufficient health
care, a coalition between the poor and the middle class was
proposed. However, there was some concern regarding the political
feasibility of this type of Part II of this article
evaluates President Clinton's Security Act and other viable
health care reform initiatives that were being considered at the
time.(66) "Part III focuses
on the coalition and whether it would actually disadvantage the
Part IV describes the state's role and its effect upon ensuring
the poor's access to (e)qual(ity) health care; Part V discusses
the types of health care systems that poor people need; and Part
IV suggests how lawyers can change the health status of the
poor."(68) In conclusion,
this article emphasizes the difference in the scope and focus of
health care needs between the poor and the middle class.(69)
For instance, it states that "the poor and under served need
broad-based reform that also includes well-drafted discrimination
provisions prohibiting states, health alliances, health plans and
individual providers from intentionally discriminating against
them because of their race, gender, sexual preference, national
origin, age, health, occupation, language or economic
status."(70) The conclusion
also suggests that community based infrastructures which provide
services to the poor, need to be built, as an example of the
types of changes that need to be implemented in order to
effectuate better health care for the poor.(71)
Ultimately, without these types of changes, true reform will not
be achieved.(72) [back]
Watson, Medicaid Physician Participation: Patients, poverty,
and physician self-Interest, 21 Am. J.L. and Med. 191 (1995).
Part I of this
article is introduced with the negative effect that Medicaid
managed care has had on the poor due to the lack of willing
participation by doctors to participate in the program. The
author suggests that financial incentives will entice physicians
to take poor patients. Tenncare is the sample program
used by the author to show the viability of this approach.(73)
Tennessee has resisted Tenncare because they feel that the
financial burden of the poor is being shifted onto them and they
are losing middle class patients. Physicians feel that their
autonomy is threatened by the coercive Tenncare program because
its just another form of government interference in the
workplace.(74) Society views the
physician complaints as a perpetuation of the dual track medical
system in which the poor receive public care and those who can
afford it receive care from private physicians.(75)
Medicaid proposed an effective way of opening up access to
private care for the poor.(76)
However, it failed in its endeavor because it did not attract
physicians . Physicians either refuse to take Medicaid patients
or limit the number of Medicaid patients they are willing to take
because of low Medicaid reimbursement.(77)
Part II of this
article provides a history of Medicaid physician reimbursement
and participation. The financial and physical outcomes of the
lack of physician participation are also evaluated,(78)and
reveal that if Medicaid were to reimburse at a higher rate, more
physicians would be attracted to the program. Part
III evaluates Congress statutory amendment to Section
1396a(30)(A) of the Medicaid Act and concludes that higher
reimbursement rates actually would not remedy the lack of
physician participation. This section concludes by stating that
it is the responsibility of the states to induce physician
participation by way of effective financial incentives.(79)
Part IV provides a detailed outline of the Tenncare waiver
application. "Tenncare focuses on group purchasing
power to encourage physicians to treat Tenncare enrollees."(80)
While this progressive approach could potentially end the current
unequal system of medical care, the Tennessee Medical Association
does not support it.(81) This
section of the article provides a detailed background and an
overview of the Tenncare program.(82)
Part V describes the legal dispute between the state of Tennessee
and the physicians over the Tenncare program. Finally, Part VI
concludes with some general recommendations as to the most
effective and least coercive way to encourage physicians to treat
C. Dodd, THE EXCLUSION OF NON-PHYSICIAN HEALTH-CARE PROVIDERS
FROM INTEGRATED DELIVERY SYSTEMS: GROUP BOYCOTT OR LEGITIMATE
BUSINESS PRACTICE?, 64 U. CIN. L. REV. 983 (1996).
This article begins by providing the reader with a historical
background of the origins and structure of HMOs. It continues by
"focusing on the practice of selective contracting by HMOs
and examines whether this practice constitutes an illegal group
boycott under the Sherman Act."(84)
It then evaluates the courts' rationale behind its rulings on the
antitrust implications of selective contracting.(85)
This article argues that "the current analytic framework,
which focuses solely on the market power of one entity, is a
narrow approach that is confined by the straitjacket of
the author contends that this framework inadequately addresses
market power in terms of the reality of the marketplace.(87)
The article "then proposes a new doctrinal approach:
analyzing the market power of an HMO not as an isolated entity,
but in light of market trends toward increased managed care
penetration and with an appreciation of the parallel behavior
exhibited by competing entities."(88)
The author poses a solution to this inadequacy which reflects a
compromise between the competitive free market and regulation
through the enactment of the any willing provider legislation.(89)
The "any willing provider" legislation is also
evaluated and the weaknesses are pointed out. "The solution,
which calls for evaluating market power in a different light,
will confront the current problem -- the failure of the antitrust
law to address the exclusion of an entire class of providers from
the emerging landscape for health-care delivery."(90)
M. Rosenberg and David T. Zaring, RECENT DEVELOPMENT: MANAGING
MEDICAID WAIVERS: SECTION 1115 AND STATE HEALTH CARE REFORM,
32 Harv. J. on Legis. 545 (1995).
This article begins with a basic introduction of the evolution
of the Section 1115 Medicaid waivers. It explains that the
waivers were implemented by the Department of Health and Human
Services to allow states to experiment with "demonstration
projects" without having to deal with all of strict
requirements of the federal Medicaid program.(91)
This article explains the general procedure for applying for and
some of the limitations on the waivers. Generally, the government
supports these waivers as a cost saving measure, locking
recipients into Medicaid HMOs.(92)
While more people are able to receive Medicaid under this
program, they are not necessarily quality and comprehensive
health care.(93) [back]
UNIVERSAL ACCESS TO
HEALTH CARE, 108 Harv. L. Rev. 1323 (1995).
This article briefly reflects on the failure of Congress
during the Fall of 1994 to pass a health care reform bill and the
public's concerns over the implementation of universal coverage.
This article identified these concerns, and also addresses a more
fundamental concern -- "why, morally, should access to
health care be guaranteed to all citizens." (94)
This article "discusses the prospects for and the
problems with justifying universal access to health care"(95)
and "attempts to provide a moral framework that supports
guaranteed access to health care."(96)
The first section of the article focuses on the "general
problems associated with the distribution of health care and the
growing insecurity in health insurance in the United
States."(97) "Part II
establishes the moral basis of universal access and sets forth a
communitarian justification that is sensitive to the unique
nature and structure of health care services."(98)
Thus it promotes universal health care through ideas of
"shared identify, the common good, and civic
Finally, a framework for implementing national reform is
suggested.(100) This framework
requires every citizen to adopt an invested (as opposed to
detached), posture on health care reform in or to overcome the
problems the current health care arena poses.(101)
James F. Blumstein, The
Fraud and Abuse Statute in an evolving Health care Marketplace:
Life in the Health Care Speakeasy, 22 Am. J. L. and Med. 205
This note discusses how fraud and abuse in the health care
market can be prevented through managed care systems. The
structure of a capitated payment system, which supports the
avoidance of overutilization of health care services, is the
source of this reduction in fraud and abuse.(102)
This article examines the history and provisions of the Fraud and
Abuse Statute.(103) This article
goes on to evaluate the impact of the Greber and Hanlester
Network cases on the Fraud and Abuse statute and generally
concludes that the formation of managed care organizations
threatens to violate this statute, especially if hospitals
provide financial assistance to physicians or physician groups.(104)
Therefore, the Department of Health and Human Services needs to
develop a "safe harbor" so that managed care
organizations do not violate the law.(105)
Kilcullen, Groping for the Reins: ERISA, HMO Malpractice, and
Enterprise Liability, 22 Am. J. L. And Med. 7 (1996).
This article asserts a timely discussion of the legal
relationship between the physician and the HMO which dictates the
parameters of his/her medical practice.(106)
This relationship represents a single enterprise and affects
patient care.(107) The second
part of this article "describes the genesis of enterprise
liability amid economic modernization and highlights its
compelling principle of risk distribution."(108)
The third part "reviews the parallel modernization of the
health sector with the introduction of the third-party liability
under traditional negligence when the third-party's acts affect
"Part V examines ERISA's vitiation of liability for payers
when they operate under self-funded employer health care
plans."(110) "Parts VI
and VII conclude with a proposal to incorporate enterprise
liability into ERISA to fairly reflect a true private sector
approach to health care reform."(111)
A failure to incorporate such a proposal would remove incentives
to provide quality health care and leave patients without any
means of seeking remedies when the HMO or the physician is
1. Ronald Horn, MD, Managed Care:
Implications For Under Represented Physicians, Journal of
Health Care for the Poor and Under Served, Vol.5, No.3, Page 154,
2. Id. at 155.
3. Id. at 155.
4. Id. at 156.
7. Thomas P. Weil, PhD, Managed
Competition For The Poor: More Promise Than Value?, Journal
of Health Care for the Poor and Under Served, Vol.5, No.3, Page
8. Id. at 162-163.
9. Impact of Managed Care Organizations
on Ethnic Americans and Undeserved Population, Journal of
Health Care for the Poor and Under Served, Vol.5, No.3, Page
10. Id. at 225.
12. Id. at 226.
16. Id. at 227.
17. Id. at 234-235.
18. Id. at 235.
19. 0 108 Harv. L.Rev. 1625.
20. 0 Id. at 1626.
21. 0 Id.
22. 0 Id.
23. 0 Id. at 1626.
24. 0 Id.
25. 0 Id. at 1636.
26. 0 Id.
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28. 0 Id.
29. 0 Id. at 1070.
30. 0 Id. at 1071.
31. 0 Id. at
32. 0 Id. at
33. 0 Id. at 1089.
34. 0 Id. at 1090.
35. 0 Id. at 1091.
36. 0 Id. at
37. 0 Id. at 1096.
38. 0 Louise G. Trubek &
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39. 0 Id. at 1082.
40. 0 Id. at 1083.
41. 0 Id.
42. 0 Id.
43. 0 Id. at
44. 0 Id. at 1094.
45. 0 Id. at 1106.
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48. 0 Id.
49. 0 Id. at
50. 0 Id. at 176.
51. 0 Id. at
52. 0 Id. at 192.
53. 0 Id. at 170,
54. 0 Sidney D. Watson, Health
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55. 0 Id. at 1648.
56. 0 Id.
57. 0 Id. at
58. 0 Id. at 1649.
59. 0 Id.
60. 0 Id. at 1654
61. 0 Id. at 1656.
62. 0 Ann G. McGinley,
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63. 0 Id. at 13.
64. 0 Id.
65. 0 Id. at 16.
66. 0 Id. at 18.
67. 0 Id. at
68. 0 Id.
69. 0 Id. at 66.
70. 0 Id.
71. 0 Id. at 68.
72. 0 Id. at 69.
73. 0 Sidney D. Watson, Medicaid
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74. 0 Id. at 192.
75. 0 Id.
76. 0 Id.
77. 0 Id. at 193.
78. 0 Id.
79. 0 Id. at 202.
80. 0 Id.
81. 0 Id.
82. 0 Id. at
83. 0 Id. at
84. 0 Christine C. Dodd, The
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85. Id. at 987.
91. Judith M. Rosenberg and David T.
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93. Id. at 554.
94. UNIVERSAL ACCESS TO HEALTH CARE,
108 Harv. L. Rev. 1323, 1324 (1995).
101. Id. at 1339,1340.
102. James F. Blumstein, The Fraud and
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103. Id. at 206-219.
104. Id. at 230.
105. Id. at 231.
106. K. Kilcullen, Groping for the
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107. Id. at 10.
112. Id. at 50.