An America Without Managed Care

After a second-place finish in the Iowa caucuses, John Edwards approached the microphone to present one of his classic "Two Americas" speeches.

Knowing he was not only speaking to a couple hundred supporters in Iowa, but millions across the nation, Edwards dipped into his campaign quiver and pulled out his first arrow. He pulled back his bow and the arrow pierced the air and struck directly into the heart of managed care.

The former senator retold the story of Nataline Sarkisyan, a 17-year-old leukemia patient at the Pediatric Liver Transplant Program at UCLA. Everyone in managed care surely knows the story. Her insurer, CIGNA, declined a liver transplant for the teenager, who suffered from multiple organ failure after a bone marrow transplant. The insurer said it "does not cover experimental, investigational and unproven services." The company's decision sparked protest from her doctors and nurses and brought picketers to the managed care company's Glendale, CA, offices.

CIGNA ultimately gave the OK, but it was too late. Sarkisyan's family had already taken the girl off life support, and she died shortly after the insurer's decision. The tragic story is yet another example of health insurers being on the wrong end of the news. How has managed care become such an easy applause line for politicians?

There was once a time when managed care was not known for funding CEO bonuses, asking physicians to rat out patients and paying fines following improper denials. In fact, there was once a time--believe it or not--when managed care was considered the guys wearing the white hats.

The early days of managed care were tough times for doctors and hospitals. Most lower-income Americans (and even one-quarter of those in the upper-income brackets) delayed seeing a doctor during the Depression. Those patients who did visit their physicians often did not pay their bills promptly. In fact, Americans were paying department and grocery stores, landlords, and dentists before their physicians. Less than 5 percent of families accumulated one-third of the country's medical costs. Fewer patients and delinquent payments crippled the healthcare system because there wasn't enough money to pay physicians and hospitals.

The nation turned to an option that had been promoted occasionally for the first few decades of the 20th century--health insurance. Supporters preached that health insurance would not only help patients pay for their care, but provide a steady stream of money for physicians and hospitals, which faced empty beds and unpaid bills.

Not everyone was sold on insurance though. The American Medical Association was concerned that managed care would place barriers between patients and their doctors. But a growing number of physicians, particularly those in rural areas, saw that their patients simply didn't have the resources to pay their bills.

Without a regular stream of income, doctors and hospitals were sinking. Health insurance jumped into the lifeboat and saved a drowning healthcare system. Now, here we are 70 years later. Many Americans no longer view managed care as a necessary piece of the healthcare system, but as an expensive third wheel that--as the AMA had warned--places barriers between physicians and patients.

The arguments against health insurers are easy to understand. No one wants to be denied life-saving services, and many worry about what will happen to them and their loved ones in their greatest time of need.

But what would happen if managed care was wiped from the system--especially in these days of foreclosures and credit card debt? Imagine returning to the days of individuals paying for services. Few want a healthcare system without managed care, but Americans are not satisfied with their current healthcare.

Even the most ardent health insurance defender would acknowledge managed care isn't perfect, but the system continues to serve its purpose--as the difference between this nation protecting its people and slipping back into the days of empty hospitals and delinquent payments.