NCPA - National Center for Policy Analysis

Doctor-Managed Health Care Plans

December 29, 1998

Fed up with having to answer to distant insurance companies, some physicians are starting up their own health-care plans. They come in many forms, including partnerships between doctors and hospitals or broad alliances of physicians.

  • There are now about 180 provider networks licensed to run health plans -- mostly forms of managed care like health maintenance organizations.
  • Experts report that another 200 provider networks bear a significant amount of risk for high claims.
  • While the movement is a reaction to the dissatisfaction of many doctors and their patients to the restrictions of health maintenance organizations, some observers question whether doctors will be any more successful at balancing care and costs.
  • But some doctors contend they can control costs and boost the quality of care by assessing the health risks of all new patients and providing them with early and preventative care to head off chronic illnesses.

In January 1999, for instance, the physician owned and managed Clear Choice Health Plan in Oregon will become the first provider-sponsored plan to serve Medicare+Choice patients.

Doctor-run plans are growing in states like Texas, Illinois, Missouri and Colorado. But few observers think they will offer much competition for insurers. In fact, some of the physician alliances have already been disbanded.

Source: Laura M. Litvan, "Can Physicians 'Manage' Care?" Investor's Business Daily, December 29, 1998.


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