June 1998

Take a hard look at Profiteering Health Maintenance Organisations before
Asia sinking too deep in quicksand

(Keywords:- HMO, profiteering, capitation, professional autonomy)

          It is a global trend, let alone Asia, that health care cost is mounting exponentially. Much is the result of our aging population, advances in medical technology which is expensive, and increasing patients¡¦ demand. Most Asian countries are finding it difficult to cope, and all are groping for possible solutions. The idea of Health Maintenance Organisations (HMOs), which introduces captitation, understandingly must attract some interest. Yet, profiteering HMOs could well be ¡§wolf in sheep skin¡¨.

          HMOs have flourished in the United States for some 20 years. Rumours are that many, especially in the West Coast, are facing the possibility of folding up. In a recent health policy report of the New England Journal of Medicine, there is a suggestion that people and employers are now moving into contracting directly with health care providers, eliminating the role of managed care insurers.

          Facing these two factors, it is plain to see that profiteering HMOs are actively moving East to look for greener and new pastures in Asia. 

          What is HMO? Simply put, for a fiscal annual contribution, the ¡§client¡¨ will have ¡§unlimited¡¨ medical care from doctors in hospitals and clinics contracted by that HMO.

          There is an apparent wealth of benefit. To the affordable would-be patients, it provides an alternative private medical service with capped cost. To the Government, in face of the insatiable demand on public health services, any system to take away part of the load must be welcomed.

          Yet, the flaws of profiteering HMO should be clearly spelt out to the Government and public alike before our society sink too deep into the quicksand. What harm can it bring? It should be noted that profiteering HMOs are not charitable nor non-profit taking organisations. Their existence must be linked to financial gain. To achieve the maximum profit, there can only be one solution: to minimise the expenses on hospitalization use, drugs, expensive investigations, etc -- all, if  apply injudiciously, will lead to unfathomed harm on the ¡§clients¡¨.

          For long, doctor-patient relationship has been simple. Yes, money does change hands, but it is for the professional service, never a business relationship. The doctor get the well deserved respect; and the patient and family the life long care.

          Today as we move into expensive high tech medicine, as our ever aging population require chronic extended care, medicine or health care is being seen by businessmen as a ludicrous undertaking. Patients are seen by them as ¡§customers¡¨ with the ¡§dollar sign¡¨ written all over their faces. When businessmen buy up medical practices and transform them overnight into profiteering venture, the time honoured doctor-patient relation disappears; cost effectiveness becomes the order of the day. After all, in business there is one and only one thing -- ¡§maximized profit¡¨.

          In the extreme case when businessmen control professional practice, professionals could be forced to forgo standards for that extra few bucks that will go into the wallets of the directors. The businessmen take the money, but the doctors bear the responsibilities, and the patients fail to get their deserved services. Worst, ¡§professional autonomy¡¨ is eroded if not shattered.

          One top HMO in the US claimed they still use the old contrast for certain X-ray investigations instead of a safer non-ionic dye. When asked how they would deal with medical litigation should sensitivity reactions arise leading to complications and loss of life, the reply was simple: ¡§we will settle it out of court, it is cheaper than to use non-ionic dye.¡¨ Patient safety, even life, only plays second fiddle to financial gain!

          From another angle, when a patient visits a doctor and is charged, say, $100 for treatment; if service is quantifiable, the patient gets $100 of service from the service provider. But if a patient joins a businessmen run HMO and pays, again, $100; that $100 ends up in, at best, a ¡§three ways split¡¨ -- to the shareholders, the management and then the service providers.

          Doctor to doctor relationship will be next to axe. Once a  business orientated HMO managed to lure a sizable number of ¡§customers¡¨, hence with an enormous bargaining power, the corporate manager will play Peter against Paul. He will offer his ¡§clients¡¨ to Peter for a very low consultation fees and if Peter refuses, he will offer it to Paul for even less. Other than splitting the profession, standards of practice will no doubt dwindle.

          Yet rising health care cost must somehow be curbed. The profession has the responsibility to advise Government the way ahead. Yes, cost containment must be strived at. Yet, the best and most effective treatment to patients should never be compromised for profit.

(Asia Health Journal)