UnitedHealth Group to let doctors make medical decisions!

"We will assume the physicians have made the right clinical decisions," said Dr. Archelle Georgiou, MD, United's chief medical officer (quotes are from AMNews, Dec. 6, 1999).

Dr. Georgiou pointed out that United had been spending $100 million dollars a year on pre-authorization procedures, and had ended up approving 99% of the doctors' decisions anyway.

While the reaction from physicians has been cautious, consumer advocates and professional organizations have been extremely positive on United's move.  Thomas Reardon, MD, AMA President, said United's new policy is, "historic, and represents a long-overdue victory for American patients."

Meanwhile, Dr. Georgiou allowed as how United would simultaneously "beef up its use of physician profiling to give doctors feedback on how their practice patterns compare with their peers."

DrRich comments: 

I hesitate to grumble about something like this. Anything that reduces the amount of red tape involved in dealing with HMOs has to be a blessing. If I were a UnitedHealth Group physician, I would surely welcome the new policy.

I simply make two observations -

1) Changing their policy to let doctors make their own medical decisions is a tacit admission that, with their previous policy, United indeed did not let doctors make medical decisions. Of course, we all knew that to be the case with HMOs. It's just that HMOs have always denied it. It's nice to know that United, at least, now seems to agree with the initial premise.

2) UnitedHealth Group, being a multibillion dollar publicly traded company, did not make this decision primarily for the benefit of their doctors or patients.  They made it because it made good business sense.  If it didn't make good business sense, their shareholders would revolt.

Let's examine this second point  more closely (i.e., that if they're doing it, it's good business).  

Dr. Georgiou gives us the most obvious explanation for why it was good business to drop the pre-authorization requirement.  United, she tells us, was spending $100 million dollars a year just to say, in essence, "Uh, OK, go ahead."  There is an immediate fiscal advantage to dropping pre-authorization. 

A less obvious explanation has to do with the impending Patient's Bill of Rights. There are several versions out there, and HMOs don't like any of them. But one provision in particular - one that the Gekkonians have been fighting tooth and nail - has had HMOs and their shareholders losing sleep. That is the provision allowing patients to sue their HMOs.  The suits that HMOs fear the most are the ones that stipulate that HMOs, by deciding which tests and procedures doctors can order, are actually practicing medicine, and thus can be sued for malpractice.  By dropping pre-authorization requirements (and thus by letting doctors have the final say on which tests and procedures will be performed), United is essentially eliminating the threat of such lawsuits.  Furthermore, if a few other large HMOs follow United's lead, much of the original impetus for a Patient's Bill of Rights will become moot, and the whole Bill of Rights movement might just be torpedoed.

Finally, there is the most disturbing explanation of all for the fiscal wisdom of this policy change. 

If you're training a dog to heel, at first you have to put a leash on him and forcibly keep him where you want him. Eventually the dog learns two things - he learns what you want, and he learns what will happen if he doesn't comply. When you get your dog to that point, you don't need a leash anymore.

United has determined it doesn't need the leash anymore. It did not make this determination lightly.  It test-marketed the dropping of pre-authorization, and crunched the numbers. United's doctors, it apparently decided, were well-trained.

It's possible, of course, that this is all for the good. To the extent that United's authorization policies were good, righteous, efficient, and medically correct, then their doctors' toeing the line is a very good thing. I don't have any personal experience with United; for all I know that's exactly the way things are.

But the beef with pre-authorization procedures in general (in addition to the red tape involved) is that HMOs too often deny tests or procedures that doctors believe are necessary.  For years HMOs have persisted with pre-authorization requirements anyway, despite their intense unpopularity with both doctors and patients, because it was felt that these procedures were absolutely necessary for controlling the behavior of physicians. If pre-authorization is now deemed unnecessary, the strong implication is that doctors finally have sufficiently lowered their expectations, abandoned the advocacy role they traditionally assume for their patients, and aligned their practice patterns with the desires of their HMO overlords. 

Furthermore, United's promise to beef up it "physician profiling," sends a strong message to its doctors. United is telling them that it still has high expectations, and that while those expectations will no longer be carefully controlled on the front-end, they certainly will be vigilantly monitored on the back-end.  The doctors still know what is expected of them, even without the leash.

In the grand scheme of things, of course, all this just reconfirms the point that was made a few years ago when doctors meekly signed the gag clauses that HMOs laid before them. By devising those gag clauses, HMOs brazenly asserted that physicians' primary obligation was to them and not to their patients, and with their signatures the doctors meekly acquiesced. 

So despite the sanguine spin placed in many quarters on United's new policy, that policy might not be purely good news. Especially for patients, some of its implications are disturbing. 

But strategically, UnitedHealth Group did a very wise thing, and their shareholders should be well pleased.

01/25/00

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