Is Consumerism the New Managed Care?

Back in the 1980s, many promises came with the advent of managed care. Reduced utilization. Free preventive care. Practice guidelines that improve outcomes and increase efficiency. Lower healthcare costs.

In theory, managed care seemed to be the right prescription, but it never fully lived up to the high hopes we ascribed to it. Although managed care temporarily put the brakes on skyrocketing healthcare costs,  it never became the solution for double-digit healthcare cost inflation.

Why? In simplest terms I'd say managed care became overly rigid in its controls and then gradually loosened its grip in response to widespread discontent. The idea of  healthcare restrictions runs against the grain of American culture. People like getting free physicals, immunizations, well-baby care and wellness classes. But they detest limitations in their choice of physicians and balk at obtaining pre-authorizations. 

By 1988, the United States was spending nearly $500 billion per year on healthcare ($2,400 per person.) In 2007, the amount surpassed $2.3 trillion ($7,600 per person.) The problems remain the same. Excessive cost. Low efficiency. Inequitable access. 

The new hope for our ailing healthcare system is the advent of consumerism. Since exerting control didn't work, maybe free-market forces will. Publish medical outcomes and costs. Drive quality through transparency. Have people shop for healthcare with out-of-pocket dollars. Maybe we really can reduce spending. Consumerism a great idea in theory, but will it live up to its promises?

Intuition tells me that healthcare consumerism is likely to fall short of expectations. Healthcare is neither a commodity nor merely a service. It is delivered in complex relationships and subject to individual patient's biological and emotional identities. The stakes in many healthcare purchasing decisions are higher and more profound than any other item in the consumer marketplace.

I agree that people might comparison shop for simple diagnostic services and basic care, such as the kind now being delivered in supermarkets and pharmacies. They also are likely to review outcomes data as it becomes more readily available and easy to understand. Quality and price may well become true criteria for decision-making, and the result would be a reduction in healthcare spending. 

However, I don't believe American consumers will contemplate the price of treatment in life and death situations. And that's where the costs and stakes are the highest. Life is priceless. That belief, just like freedom, is deeply ingrained in our culture. 

Consumerism is a reasonable answer to runaway healthcare costs. But, much like it was with managed care, we can't expect it to be the answer.

— Tom DeSanto