In just a few decades American health care financing has, in a sense, come full circle. After being largely patient-financed in the early twentieth century, generous insurance coverage in mid-century largely permitted providers to do as they wished and charge what they pleased-an Artesian Well of Money that left patients and physicians well-insulated from the costs of care. That system's inevitable explosion of costs spurred urgent efforts to contain health care expenditures, as payors sought to control or at least influence medical decisions. In many ways this "managed care" was clinically vexatious and economically disappointing. Its medically intrusive tactics have now largely though not entirely faded, and-back to the future-the current trend is to place economic responsibility back in patients' hands via "Consumer-Defined Health Plans" ("CDHPs") that couple catastrophic insurance coverage with large deductibles. Across this trajectory of financial changes, the focus of health care litigation has evolved right alongside. When physicians largely controlled both care and costs, medical malpractice occupied center stage. Then, as managed care entities exerted greater financial and clinical control, they too became litigation targets, sometimes via direct corporate liability for their own financial and medical decisions, and sometimes under ostensible agency for alleged missteps of physicians with whom they associated. And now, as patients regain financial responsibility, the focus will shift yet again. This Article explores that shift. After further surveying history and the current transition to CDHPs, I will examine three kinds of litigation that are especially likely to arise where patients pay for their own care. Torts questions will arise: when physicians do not disclose the projected costs of care, is this a breach of informed consent? Further issues may arise from the fact that, although physicians have a confidential relationship with patients, their financial interests can create significant conflicts of interest. Where physicians' medical recommendations are too cozy with their own financial interests, can this be a breach of fiduciary duty? Finally, contract questions will emerge around price tags. Where prices are not agreed on in advance, they must generally be "reasonable." And yet price structures in health care are often too incomprehensible to discern what "reasonableness" might mean. When patients complain providers' charges are too high, jurors may be asked to address important questions of health care pricing. Many of these potential litigation issues are not inherently novel. But they may arise with surprising force and frequency. When large numbers of middle income people begin paying directly for substantial procedures out of pocket, they will likely begin scrutinizing more closely the ecomonic as well as medical wisdom of their health care. This Article explores some of the directions that scrutiny may take.
E. Haavi Morreim Ph.D.,
High-Deductible Health Plans: New Twists on Old Challenges from Tort and Contract,
59 Vanderbilt Law Review
Available at: https://scholarship.law.vanderbilt.edu/vlr/vol59/iss4/7