Managed-Care Incentives Should Be Disclosed, Phys...( atient care they maycreate the percep...),Health

He says patients should be aware of incentives so they can become educated health-care consumers. And he urges health plans and doctors to disclose them when asked. "It is in the self-interest of managed-care plans and physician groups to be more open about these incentives," he says. "They should come out in front on this issue and try to come up with ways to deal with patients' suspicions about managed care."

Gallagher and co-authors argue that voluntary disclosure would be better than federally regulated disclosure because it could adapt more quickly to rapid changes in the health-care industry. In 1990, for instance, Congress instructed the Department of Health and Human Services to develop more detailed regulations on financial incentives to physicians in Medicaid and Medicare. These regulations did not take effect until Jan. 1, 1997, and the managed-care industry had changed drastically meanwhile. The federal regulations ban incentives that limit necessary medical services to individual patients, but they apply only to referrals that physicians order but do not supply themselves. They also require managed-care organizations that contract with Medicaid or Medicare to disclose financial incentives that cover referral services. These disclosures are made to the Health Care Financing Administration (HCFA) or the state Medicaid office.

Managed-care plans also must disclose their financial incentives to Medicaid or Medicare patients who request this information, but they are required only to summarize a plan's incentives rather than provide information about a patient's own physician. Managed-care plans also are under no obligation to inform patients about the financial incentives they offer to subcontracting physicians. The federal regulations single out for special scrutiny plans whose financial incentives place physicians
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Contact: Linda Sage
sage@medicine.wustl.edu
314-286-0119
Washington University in St. Louis
27-Jan-1999