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Abstract
In economics of healthcare reform, one of the liveliest debates dwells on cost versus quality. Cost containment is an integral element of any healthcare system, largely because it is the main determinant of sustainability of the system. This paper addresses this issue through analysis of literature on cost containment and quality issues. Special focus is on the efforts made by Japan, particularly tight control on payment conditions. Examples from Canada’s healthcare system are also given, and comparison made with that of the US on the issue of managed care.
The central theme of this paper, which is derived from the literature review, is on the role that managed care plays in ensuring that the goals of quality and cost containment are achieved in the US. This study found that managed care is better than consumer-driven care as far as the goals of cost containment and quality of healthcare are concerned. Through the managed care plan, the US has a better chance of achieving better health outcomes, containing costs, and achieving universal health coverage in a sustainable manner.
Introduction
One of the most common concerns expressed regarding universal health insurance coverage is controlling health expenditure while at the same time maintaining a high quality of service. Many countries, including the US, appear not to be doing so well in this area. The key challenge in such countries is to ensure that the quality of healthcare is always high while at the same time costs are being contained. Moreover, efforts have to be made to ensure that such an undertaking leads to a sustainable healthcare system.
In contemporary contexts, it is difficult to guarantee sustainability, not least while costs are being contained and expectations of quality healthcare rising. Moreover, factors such as technological advances and an increasingly aging society have a significant influence on sustainability. In such a scenario, different countries adopt different measures. For instance, the United Kingdom introduced the pay-for-performance plan while Japan has put in place a uniform fee schedule that is applicable across the country.
This paper explores literature on efforts to maintain high quality of healthcare while at the same time seeking to contain costs. In the literature review, focus is on the various factors that influence the success of this undertaking. From this literature review, the central theme of this paper is derived and discussed. The analysis of this discussion yields implications for the future.
Literature review
Different countries employ different methods of cost containment while ensuring that high quality of medical care is maintained in a sustainable manner. There are many factors that come into play during the pursuit of this goal. According to Weisbrod (1991), policymakers in the healthcare sector are faced with a ‘quadrilemma’, whereby they have to put into consideration four factors, namely technological change, quality of care, insurance, and cost containment. Weisbrod (1990) points out that in the post-World War II era, three major changes have ocurred in the US healthcare system. The first change has taken the form of the emergence of new technologies, which have caused far-reaching changes to the practice of healthcare. Most of the mechanisms of diagnosing diseases did not exist four decades ago. Secondly, a rapid expansion has been experienced with regard to the role of health insurance, both in the public and in the private realms. The third factor is a dramatic rise in personal health expenditures.
With the ever-rising costs of healthcare, and health insurance, a scenario has been created whereby there is impetus for the emergence of new technologies. Once they are fully adopted, these technologies contribute to further increases in cost of healthcare. Conversely, technological advancements have contributed to a rise in demand for health insurance. In such a scenario, little focus is being put on the citizens’ ability to pay for the rising costs of healthcare. Moreover, no satisfactory efforts are being undertaken to ascertain whether the high-cost health services being paid for are of high quality.
Given the fact that healthcare has an effect on the quality and length of human life, many societies appear to have accepted the normative position that it is imperative that ‘high’ quality healthcare is made available across the country regardless of whether an individual is able to pay (Hoadley, 2004). The society appears to have assigned a property right to healthcare. In such a situation, pressure is piled on government to provide finance for access to healthcare in a redistribute manner. In the US, such a scenario manifests itself in the way efforts by individuals and employers to finance healthcare in the private market are being supplemented by injection of governmental resources, mainly through Medicaid and Medicare programs. This supplementation is also being done to a lesser extent through charitable activities by private entities. Weisbrod (1990) also observes that the demand for protection of consumers from an environment characterized by informational asymmetries has also contributed to demands for the provision of universal healthcare.
Literature shows that there is no guarantee that once an individual pays a high cost, he will receive healthcare services that are of proportionately high quality (Lagoe & Westert, 2004). This is particularly the case in situations where the high-cost factor is intricately intertwined with efforts to provide universal health insurance. Financing ought to go hand in hand with quality assurance. This is particularly the case during critical times when the sustainability of healthcare services is being threatened by resource constraints (Wouters, 1991).
Economics literature, particularly studies on health-care demand, show that quality remains a key determinant of patterns of utilization, although it does not identify clearly the specific components of quality that are of the greatest value to the patient. Moreover, from a supply-side perspective, analyses of costs have not dwelt a lot on cost-quality tradeoffs. Such a scenario necessitates efforts by policy makers to determine the extent to which cost-recovery mechanisms are affordable. One such mechanism may involve ensuring that quality standards are increased whenever there are price increases. Of more importance, though, would be the tendency to direct the greatest efforts to those aspects of healthcare quality that will bring about maximum effectiveness at the lowest cost. This would greatly increase the chances of the health service being financially sustainable.
Indeed, focus on those aspects of healthcare quality that yield the best outcomes at the lowest cost would be of great benefit to efforts by policymakers to formulate a sustainable health care policy. According to Chernew (1998), such aspects would fall within the realm of managed care. Chernew indicates that managed care plans greatly help in reducing health care expenditure. However, the main problem in this regard is that not much is known regarding whether the managed care plans are effective in controlling the growth of healthcare cost.
Chernew (1998) observes that there is a relationship between the emergence of new medical technology and cost growth. The main question in this regard is on whether the additional costs are worthwhile as far as the achievement of the intended quality improvement is concerned. In Chernew’s (1998) view, the extent to which managed care can lead to a reduction of high healthcare expenditure will be determined largely by the impact this type of care has on the adoption of medical technology. In literature, studies that focus on market-level data derive conclusions that are different from those that focus on plan-level data. In general, literature evidence suggests that as currently practices, managed care may lead to a reduction of the prevailing rate of rise in healthcare cost. However, it is difficult for managed care to lead to a reduction in the share of a country’s gross domestic product that is directed to healthcare reform. The only time that this reduction can be achieved is when there is a change in the cost-increasing nature of technological advancements (Chernew, 1998).
In England, managed care was seen to be put into practice through the introduction of the Pay-for-performance program (Campbell, 2007). This program, which was introduced in 2004, entailed the UK government’s setting-aside of some $3.2 billion targeted at family practitioners. After the first year of implementation, the results obtained exceeded the government’s expectations, whereby 83.4% of all the incentive payments available were claimed (Campbell, 2007). Nonetheless, in the practices of English families, the quality of healthcare had already started to improve. This improvement was attributed to a number of initiatives, which included a national inspection system and national standards government treatment options for chronic diseases.
Prior to the introduction of the Pay-for-performance program, family practitioners in the UK had already gained exposure to experience relating to the use of financial incentives that were introduced in the 1990s (Campbell, 2007). For this reason, it remains unclear whether the improvement in the level of quality recorded after the introduction of the 2004 Pay-for-performance contract is a reflection of the improvements that were on the way or whether it was an indication of a trend towards improvement. Moreover, the impact of the incentive program ought to be looked at in the context of the underlying quality-improvement strategy on the basis of which the pay-for-performance contract was introduced.
The key question in this discussion is on whether managed care can lead to high quality and low cost at the same time. The scenario in the UK following the introduction of pay-for-performance contract reflects a problem that many countries face in efforts to determine the success of programs aimed at improving quality of care while at the same time reducing cost. It becomes difficult to determine whether the positive or negative results observed arise from the implementation of the current program or the ones that previously existed.
Moreover, efforts to determine the impact of the programs fail because of the absence of control groups (Campbell, 2007). It is normally impossible to get a control group because, in most cases, the programs are introduced in all parts of the country simultaneously. Moreover, even in efforts where comparisons are made with previous programs, overestimation of quality may easily occur. For instance, patients surveyed are normally selected based on the absence or presence of treatment using relevant drugs. Those who remain untreated and who fail to comply with the requirements of the treatment procedure tend to be locked out of the surveys. In such a scenario, it is obvious that in the final outcome, the quality of care being made available to the population would be overestimated (Campbell, 2007).
In efforts to determine the impact of managed care on cost and quality, economists have devised a mechanism that involves comparing the outcomes of the clinical indicators for which financing was provided with those clinical outcomes for which no financing was provided. In the case of the pay-for-performance contract, the results obtained using this mechanism showed that the contract was not necessarily be responsible for the improvement in quality and reduction in cost, which was recorded between 2004 and 2005 (Ikegami, 2011).
Nevertheless, monitoring the performance of healthcare professionals is always a major step ahead in ensuring that citizens get healthcare services that correspond to the amount of money they have paid (Zarabozo, 2000). This active monitoring is effective when it is done in an environment where financial incentives have been provided by the government. The only key condition for success to be achieved in this regard is that the performance targets and the rewards offered are properly aligned to the core values of the professionals being rewarded. However, on its own, professional motivation cannot guarantee improvement in quality of care, particularly in situations where physicians are forced by circumstances to make huge financial investments, for example, through employment of additional staff, in order to enhance quality in their practice.
Some countries, such as Japan, efforts to contain costs have been successful through the introduction of a uniform fee schedule that is applicable nationally (Hashimoto, 2011). In the case of Japan, the first thing was to set a global revision rate and then making revisions on an item-by-item basis. This approach is used in a context where the process and structural dimensions of quality are rather poor. However, in this context, healthcare system is structured in such a way that there is a lot of emphasis on the way physicians operate and the way hospitals are developed across the country.
The basic policy in Japan emphasizes on tight control on payment conditions, but in regard to how services are delivered, a laissez-faire approach is used. This approach has resulted in scarcity of accountability and professional governance. The structural problems being encountered in the healthcare system have necessitated the shifting of balance towards more freedom on conditions of payments. Moreover, critics have pointed out to the need for reimbursement rules to be simplified as one of the way of creating freedom on conditions of payment.
Regional health planning is also touted as an ideal solution to the tightened control of activities relating to service delivery (Teisberg, 1994). In this regard, it would be important for the providers’ performance to be evaluated through public monitoring in order to maintain high quality standards. Nevertheless, the ability by Japan to provide high quality healthcare at low cost creates the impression that initially, health policy priority should be on improving access and preventing impoverishment. Once this goal has been achieved, the next stage should be the pursuit of efficiency and quality.
There are many factors that come into play in efforts to contain costs, particularly in countries where success has been achieved in efforts to improve quality. Examples include domination of the healthcare delivery system by the private sector and the use of the fee-for-service payment mode (Fuchs, 1996). On the contrary, such contexts are characterized by more frequent physician consultation sessions, a higher number of days spent in hospital per person, and a higher frequency of hospital sessions per head. Typically, these factors play out mainly in the industrialized and emerging economies, where there is an ever-increasing aging population.
Under these conditions, it becomes challenging to achieve success in cost containment efforts (Beauregard, 2004). Nevertheless, there are strategies that can lead to a major reduction in cost without compromising on quality. One of them is greater preference to outpatient services at the expense of inpatient care. In some countries, for example Japan, the preference for outpatient care instead of inpatient care is deeply rooted in cultural practices. In such societies, the culture influences individuals to prefer less invasive care, and this may even be reflected in a low number of people using surgical procedures. The impression created here is that it would greatly help if a culture of preference for less invasive care was inculcated in a country’s cultural fabric.
Additionally, the payment system used may influence the efforts made towards cost containment. This is particularly the case if cost-control mechanisms have been put in place on the supply side. In the case of Japan, this takes the form of a uniform fee schedule. In such a nationally uniform schedule, controls are exerted on all the money that flows to virtually all providers from each insurance plan. This creates a situation where there are numerous insurers but only one system of payment across the healthcare sector. In such a structure, equity is improved owing to the standard platform on which payments for all health insurance plans are processed. Moreover, it leads to the reduction of administrative costs and an increase in efficiency.
Indeed, administrative costs greatly contribute to the high cost of healthcare in many economies. These costs differ from one country to another. In the US, for example, the per capita expenditure on administrative costs for health care was $450 in 1987, while in Canada the administration expenditure was a third of this amount (Woolhandler, 2003). However, lately, technological and organizational changes have changed the way healthcare administration is undertaken, in some cases leading to reduction of costs.
With the stiffening of competition and the introduction of managed care, providers have been forced to adopt approaches that are more business-like. In the US and Canada, it is common for merges between hospitals to take place. The same case applies in the case of health maintenance organizations (HMOs) focus on ‘back office’ tasks. The regular mail has replaced email and internet makes it possible for insurers to verify the eligibility of applications, to review utilization trends, and to approve payments on-line. By the turn of the 21st century, about 60% of claims in the US health insurance sub-sector were being filed electronically (Woolhandler, 2003). Moreover, 84% of all the country’s Medicare claims were also being processed in this way (Woolhandler, 2003).
In Canada, technological advances have also brought about far-reaching changes in the health sector, and in some cases turmoil as well. These changes have stirred a heated debate regarding their impact on cost controls, the availability and utilization of medical technology, the roles performed by investor-owned providers, as well as trends in hospital closures. All in all, technological change has brought about some changes in organizational structure. HMOs have mushroomed across the country, there is a trend towards automatic billing, and clerical tasks have resulted in a major reduction in administrative costs.
The reality of the matter, though, is that even in this era of technological advancements, administrators are indispensable in the practice of modern healthcare. Administrators ensure that supplies are always on hand, filing of records is done in the right manner, and payment for health care workers is processed on time. There are many intensive and sophisticated management tasks that are viewed by many as having a pivotal role in ensuring that cost and quality problems are addressed amicably. Those who hold this view point out to the key role that administrative staffs perform particularly handling of clinical-information systems, utilization review, and quality-improvement programs. However, critics of administrators view them as people who carry out superfluous tasks, who only add to the size of the payroll instead of contributing to clinical needs.
A key challenge is on determining the point at which administration is said to be optimal. Questions are normally posed on whether the high administrative costs in the US compared to those of Canada lead to improvement in quality of care. There are no studies on what administration is optimal as well as the impact of increased administrative spending on quality of care relative to countries that are lean on administrative spending. In this context, economists and healthcare policymakers rely on indirect evidence, which his sparse. This evidence has been obtained largely on analyses of HMOs and hospitals that are investor-owned and whose administrative costs are high. The key finding has been that the for-profit facilities tend to have low-quality costs and higher costs compared to not-for-profit HMOs and hospitals. In the international context, there is little relation between administrative expenditures and overall cost increase or other health indicators such as life expectancy (Woolhandler, 2003).
In the US, several factors come in to augment administrative costs. For instance, private insurers play a larger role in the US than in other countries, including Canada, Germany, and the Netherlands. In this regard, functions that are absent in various public programs but are essential to private insurance, such as marketing, and underwriting, account for slightly more than 60% of the overhead of private insurers.
Analysis of literature shows that systems with multiple insurers, (like in the case of the US) tend to be intrinsically costlier compared to those that adopt single-payer systems (like in the case of Japan). On the part of insurers, this means that claims-processing facilities have to carry out multiple duplicative tasks, while at the time focusing on small insured groups. These two factors greatly increase overhead. Additionally, a fragmented system of health insurance leads to an increase in costs for the all providers because they have to address multiple insurance products. In such a scenario, they have to determine the eligibility of applicants while at the same time keeping track of numerous copayments, approval requirements, and referral networks (Newhouse, 1981).
In Canada, physicians submit virtually every bill to a single health insurance company. In a context where there are numerous insurers, there is a preclusion of paying a lump-sum to hospitals, based on a global budget. In the system of global-budget operations, government authorities simply negotiate with hospitals in order to come up with an annual budget on the basis of clinical performance, past budgets, the changes that are projected in input and service costs. Once this agreement has been reached between the providers and the government, hospitals simply receive lump-sum payments at periodic intervals. Countries have adopted global budgets have managed to do away with most billing, thereby keeping internal cost accounting at a bare minimal. This is because the charges arising from these procedures are negligible, hence cannot be attributed to insurers and individual patients.
However, it is not possible to attribute the rising cost of healthcare in the US to fragmentation and the consequent rise in administrative costs alone. This is because at the onset of this fragmentation, the healthcare system of the US greatly resembled that of Canada. Rather, it may be worthwhile to note that this growth in cost coincided with the introduction of market-based competition and managed care. These two practices necessitated the introduction of highly complex auditing and accounting practices that had for a long time become an established standard in the world of business. However, some caveats apply with regard to the adoption of auditing and accounting standards in some nursing homes, hospitals, and homecare agencies, which make use of different accounting categories.
Central Theme of the Paper
In the literature review, many factors are seen to have an impact on efforts by countries to ensure that cost containment efforts succeed without compromising on quality. In many countries, this is a difficult undertaking that is fraught with numerous challenges. In many economies, focus is on ensuring that there is universal access to healthcare and health insurance followed by an improvement in this access. Once these two goals have been achieved, focus shifts to aspects of cost containments in order to ensure that the healthcare approach adopted is sustainable. The central theme of this paper is on the role that managed care plays in ensuring that the goals of quality and cost containment are achieved in the US.
The issue of the introduction of tight control of payment conditions is explored in comparison to the experiences of countries with multiplicity of health insurance providers, such as the USA. It should be noted that systems with multiple insurance providers are intrinsically costlier compared to those that adopt single-payer systems. In light of this analysis, it is possible to determine whether the managed care plans are effective in controlling the growth of healthcare cost.
The role of managed healthcare in cost containment
In the US, managed care has for a long time been considered an effective approach for ensuring high quality of healthcare while at the same time supporting cost containment efforts. However, in recent years, attention has been shifting in other areas, largely because of the bleak promises of limiting expenses within the realm of managed care. One of the alternatives to managed care, which has started gaining ground in recent times, is consumer-driven healthcare (Bachman, 2004). This section explores the prospects of managed care bringing about the much-needed quality at reduced costs.
People in the US continue to pay more for healthcare, yet the level of utilization of healthcare capacity is lower, for example in comparison with Europe. Although citizens of most European countries pay less for healthcare, their utilization of healthcare capacity remains much high compared to that of the US. Through such comparison, many questions have been arising regarding ways improving healthcare quality while at the same time safeguarding sustainability and economic stability.
The situation of failure of managed care creates a frustrating scenario for both individuals and healthcare providers. Nevertheless, it has created an opportunity for further research on how a new managed health care policy can be introduced, characterized by efficient cost controls and guarantees of a high number of positive health outcomes (Marquis, 1999).
Currently, there is pressure on the US administration to come up with cost containment measures that will yield positive results in the short term while at the same increasing health outcomes for the country’s citizens. In this regard, it is imperative to note that some of the objectives that the US set out to achieve through the adoption of managed care some three decades ago have been achieved.
Over the last two decades, managed care has been widely developed as a way of controlling the delivery system in order to constrain the growth of healthcare costs (Cagey, 2000). This approach traces its origin in Western US, where staff model plans were used to employ caregivers such as physicians directly. The plans found their way into the private health insurance sector, where care delivery and costs were controlled through various measures aimed at restricting hospital utilization. Some of these measures entailed regulating admissions, controlling lengths of stay, encouraging healthful behaviors, and limiting access to various specialists.
The public started adopting managed care owing to the growth in its popularity, particularly in the private sector. The federal government, through the Medicare program, started using managed care options. Moreover, state governments also became interested in this approach after being burdened with expenses relating to healthcare for the elderly and indigent as well as lacking the capacity to continually run all operating deficits.
Throughout the 1980s and 1990s, expansion of managed care across the US has been remarkable. In numerous markets, this adoption was characterized by a shift from indemnity insurance to managed care plans. Many businesses started providing managed care as one of the core options available to employees. A trend emerged in which many employees of large firms were enrolling in these programs.
By and large, this trend negated the traditional tendency by the government to avoid any move that would translate to a transfer of risk created by the indigent and elderly to the private sector. In such a situation, the private sector started participating to a large extent in the Medicare and Medicaid programs. Such unwillingness to privatize the programs was clearly demonstrated by the Clinton administration. More and more people enrolled in Medicare managed care. For instance, between 1991 and 1999, the number of people enrolled in Medicare managed care rose from about 1 million to 6 million (Anderson, 2003). During this same period, state governments began fully adopting managed care in order to constrain costs. Moreover, the state governments have always had more incentives for adopting this approach, considering that they have fewer resources than the federal administration.
According to Levit (2004), there is evidence to show that through managed care, health care expenses were reduced in the US, majorly through constraints on service utilization. Since its beginnings, managed care brought about controls on the way hospital care was utilized. This was a major step ahead in cost containment efforts because hospital utilization was a major source of costs in the healthcare system. Other cost-reducing control measures introduced through this approach included pre-authorization mechanisms, and physician gate keeping. The impact of such constraints were evident in the form of length of stay and hospital admission rates, which were lower compared to areas where the managed care strategy was yet to be adopted. For example, in western US, the admission rate was 955 per 10,000 people, which is 19% below the country’s national average (Levit, 2004). Moreover, the mean hospital stay in this region remained 9% below the national average during this same duration (Levit, 2004).
However, in recent times, managed care has been on the decline, leading to rising costs of healthcare in the US. Several factors have contributed to the unprecedented opposition to the plan and its subsequent failure. One of these factors is the failure to reconcile physicians in order to ensure that those owning insurance plans could choose hospitals and even practitioners. Indeed, many lawsuits have been filed as a result of conflicts relating to the plans’ ability to determine crucial decisions relating to referrals. In this case, the people lodging complaints have been physicians, consumers, and other paying entities seeking injunctions and financial damages against the business practices perpetuated through managed care. All along, courts have not accepted to term the cost control methods illegal. However, the lawsuits have had a damaging effect on the way managed care is perceived in the business and consumer world.
The second factor has been the souring relationship between healthcare providers and insurance plans. Consumers have increasingly been dissatisfied with various business practices perpetuated by the plans (Hacker, 1997). The most common problems arose with regard to arbitrary denials of healthcare services, low rates of payment, and unwillingness to pay promptly for healthcare services. Moreover, providers have persistently rejected the idea of risk contracting agreements, whose terms exposes them to the huge burden of many additional expenses such as pharmaceutical costs.
The decline in managed care has come shortly after the plan had managed to attain universal acceptance. A crucial indicator of this decline is the way managed care is increasingly unable to restrain healthcare costs, yet this was its intended purpose since its inception. In such a situation, per capital healthcare expenditures have started rising, particularly considering that a major barrier to spending on healthcare has been removed with the decline of the plan.
With the decline of this plan, not only have major barriers to spending been removed, but many expenses are also being transferred to consumers as well. Moreover, these plans started raising premiums instead of containing costs, largely in an effort to avoid heavy operating losses. Moreover, other related programs were introduced in efforts to trigger competition with traditional forms of health insurance, though their introduction meant an additional cost for consumers.
The decline of managed care has paved way for the rise in consumer-driven care (Buntin & Damberg, 2006). In this new approach, decision making on healthcare is increasingly being left to consumers. Unfortunately, this new approach resulted in increases in healthcare spending on an annual basis. These expenditures were transferred to consumers largely through deductibles, higher premiums, and copayments. This increase in healthcare spending has been remarkable since the early 2000s.
As consumers become increasingly involved in healthcare decisions concerning their treatment, the underlying aim is to arrive at the same objectives that were being achieved through managed care. For instance, high deductibles are used as incentives for increased participation in cost issues while catastrophic coverage caters for high-cost services, for example inpatient care. Screening and prevention services, on the other hand, are funded through consumer savings accounts.
However, consumer driven care has stirred controversy across the US healthcare system (Ikegami, 2009). Those who support this approach say it is ideal because it places the greatest decision making responsibility on the person who will be affected most by those decisions (Kelly, 2004). In contrast, its opponents consider it inferior to managed care because it presents those who pay for healthcare as well as employees with a mechanism through which they can easily abdicate their responsibilities. Such controversy was unheard during the days when managed care was being implemented across the country. For this reason, managed care appears to be the best approach for achieving the twin objectives of cost containment and quality care.
Implications for the future
From the discussion on the central theme, it is clear that the managed care plan attracted little or no controversy during the several decades that it was being implemented in the US. This approach contributed greatly to the efforts to maintain high quality of care while at the same time achieving cost containment goals. Through managed care, the US healthcare system was able to reach the same goals that Canada and Japan had achieved. Moreover, this achievement had been reached without the US having to introduce tight controls on payment conditions like in the case of Canada and Japan.
Going into the future, the US ought to revert back to the managed care system, which made it possible for various stakeholders to direct the greatest efforts to those aspects of healthcare quality that would bring about maximum effectiveness at the lowest cost. Moreover, through this approach, administrative costs were greatly reduced as there were many avenues through new technologies would be integrated into the system.
Summary
In summary, the debate on cost versus quality constitutes an integral aspect of efforts to reform the health care system. Different countries have adopted different plans with the aim of ensuring universal coverage while at the same time succeeding in cost containment in order to guarantee sustainability. This is a difficult undertaking, considering that numerous factors have to be put into considerations. For instance, some plans that may work in developed countries are inapplicable in developing countries. Moreover, cultural differences play a key part in choice of healthcare plans. For example, in Japan, culture influences many individuals to prefer less invasive care, and this may even be reflected in a low number of people using surgical procedures in the country.
On this basis, it is easy to understand why tight controls on payment conditions while the US opted to adopt managed healthcare plan. In each case, the underlying aim was to reduce costs and maintain a high quality of healthcare. Obviously, each plan has its benefits and weaknesses, and it is upon policymakers to inspire change in the right direction. In the case of the US, the adoption of consumer-driven care as a replacement to managed care is a step in the wrong direction. This approach gives employers and those who are responsible for making healthcare-related payments a leeway to abdicate their responsibilities.
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