This documentary explores the changing world of American medicine and the
controversial money and medical issues surrounding the rise of HMOs. The new
market approach to health care has halted skyrocketing health costs - but
what's been the impact on doctors, nurses and patients?
FRONTLINE goes inside one of the biggest and most aggressive HMOs, Foundation
Health Systems, to see the philosophy of for-profit managed care at work.
CEO Malik Hasan is an outspoken champion of managed care's principles and
argues that managers with their eyes on the bottom line are improving patient
At two hospitals profiled in this report, however, there are strong critics
of the new system. Doctors at the medical center of the University of
California, San Diego once were comfortably supported by virtually open-ended
insurance reimbursement. Now they have to monitor expenses. One doctor has
had to turn to cosmetic surgery to compensate for lower-paying fees he receives
for surgery performed on children with birth defects.
At Beverly Hospital near Boston, the CEO has redesigned hospital systems to cut
costs and believes it hasn't harmed quality of care. His nurses disagree,
saying they are overburdened and the use of unlicensed personnel is jeopardizing
Despite the many critics of managed care, this report points out that the rise
of the HMOs must be viewed in perspective. Before their emergence,
health costs were out of control; doctors and hospitals were accustomed to
having carte blanche in patient treatment.
Has the pendulum swung too far? Experts say the outlook for managed
care is linked to a larger issue: what is the appropriate level of
medical spending for the U.S.? Managed care's future will likely be
shaped by the outcome of that debate.