Medical necessity: do we need it?

The term medical necessity has been mainly a placeholder in insurance plans for over thirty years. More recently, the national health care reform debate and litigation over denials of costly experimental treatments have broken the term out into open discussion about what a necessary service is and who should decide if it is covered. This paper summarizes the history of the term and its evolution from an insurance concept controlled by practicing physicians to a rationing tool used by insurance administrators. How did national reform efforts address this terminology, and how should we define medical necessity in a changing delivery system?

Running as fast as they can: organizational changes in home health care.

During the 1980s, as the health care industry experienced what observers have dubbed a revolution, the home health industry also experienced its own transformation. Utilizing three organizational theories (neoinstitutional, resource dependency and population ecology), the authors report on a study of a probability sample of 163 home health agencies (HHAs) that were interviewed in 1986 and again in 1987 on the effects of Medicare policy changes including prospective payment (DRGs). This study tests hypotheses concerning the influence of environmental factors (e.g., state policy and characteristics of the local market) and organizational characteristics of the HHA (e.g., tax status and Medicare reliance) in explaining the propensity of HHAs to be (or become) parts of chains and/or multi-facility systems; and to develop particular types of interorganizational relations. The paper discusses the results in the context of public policy changes and the implications for future research and practice.

Public light and private dark: the privatization of home health services for the elderly in the U.S.

The privatization of health care has been a controversial topic that has consumed an increasing share of national attention in both the United Kingdom and the United States. In this paper we consider several definitions of privatization; outline two strategies of privatization--privatization by replacement and privatization by reduction or attrition; identify possible consequences of various policies of privatization for health and social services for the elderly; and offer some ideas about how trends toward privatization may be assessed, utilizing empirical data from research on the impact of medical cost containment and privatization on community-based services in the U.S. That the substance of government policy is moving toward privatization is without question; that these policies may have serious consequences for outcomes of social equity is still under debate. The trends suggested in our research have potentially negative consequences for marginal elderly clients in U.S. If the consequences of privatization can be linked to the denial of service to needy clients, privatization may, indeed, represent a dark alternative to the welfare state.

Purchasing power: business and health policy change in Massachusetts.

As in many states around the country, health care costs in Massachusetts had risen to an unprecedented proportion of the state budget by the early 1980s. State health policymakers realized that dramatic changes were needed in the political process to break provider control over health policy decisions. This paper presents a case study of policy change in Massachusetts between 1982 and 1988. State officials formulated a strategy to mobilize corporate interests, which were already awakening to the problems of high health care costs, as a countervailing power to the political monopoly of provider interests. Once mobilized, business interests became organized politically and even became dominant at times, controlling both the policy agenda and its process. Ultimately, business came to be viewed as a permanent part of the coalitions and commissions that helped formulate state health policy. Although initially allied with provider interests, business eventually forged a stronger alliance with the state, an alliance that has the potential to force structural change in health care politics in Massachusetts for years to come. The paper raises questions about the consequences of such alliances between public and private power for both the content and the process of health policymaking at the state level.

From cottages to condos: the expansion of the home health care industry under Medicare.

The home health care industry has undergone a dramatic period of growth since the passage of Medicare (Title XVIII of the Social Security Act) in 1965. This growth has occurred in both the expansion of the total number of Medicare-certified agencies providing care, as well as the number of clients served and hours of care provided. It has been suggested that the single most important factor in this market expansion was the inclusion of a home care benefit in the original Medicare legislation, thus making it possible for nonprofit home care agencies to rely on a predictable source of government reimbursement. This paper explores the influence that amendments to the Medicare legislation since 1980 have had on market expansion, as well as other federal, state and private policy initiatives that have also influenced this growth. The authors suggest that overall growth does not equate with improved access or availability of needed services in the home for the frail and functionally-impaired elderly. Research findings from the first year of a three year study designed to document the impact of cost containment policies on community-based care for the elderly are reported in summary form to illustrate the authors position.

Business and the pushcart vendors in an age of supermarkets.

The subject of this article is the impact of the political participation of business on the substance, process, and power of State policymaking about medical care in the 1980s. The article focuses on organized business coalitions, how and why they emerged to participate in the health policy debate, and the impact of these interests on health policy itself. It asks the question, How and to what extent has the emergence of business as an actor in health care politics changed both the process by which health policy is formulated at the state and federal level and the substance of health policy itself? It comes to the conclusion that business involvement has varied in impact and intensity from state to state, that business participation ultimately reinforces the control of the private sector over medical care resources, that business power can be used to decrease the autonomy and power of medical providers and is consistent with and reinforces current trends toward privatization and corporatization of the medical care system, and that the political participation of business has produced a degree of structural change in the medical care system. These changes have profound implications for unorganized consumer constituencies and their access to the policy process.

Crabs in a bucket: the politics of health care reform in California.

In 1982 the state of California adopted a package of legislation collectively known as "the Medi-Cal reform." This article examines the background of this reform, the process through which it was adopted by the state legislature, and its effects on the various interests involved. In particular, the article focuses on the alteration of power relationships occasioned by the emergence of business interests as an active force in the formulation of health policy.