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When the Western Clinic started offering pre-paid health care, using specific providers, to employees of a Tacoma lumber company in 1910, both the core concept that would later be known as managed care (any way of controlling the provision of healthcare) and the entity later termed Health Maintenance Organization (requiring pre-payment) were begun.

This was the first time that health services were paid for on a capitated (per- member, per-month) basis, and for fifty cents a month, a broad range of services were offered, making it a relatively secure economic option for both patients and providers.1 It wasn't until almost two decades later that Baylor Hospital in Houston offered up to 21 days of hospital care in exchange for $6 a year to 1,500 schoolteachers, thus forming Blue Cross.2

In the same year, 1929, The Ross-Loos Clinic in Los Angeles implemented a combined medical- hospital coverage plan serving thousands of public employees in its contracts with city agencies3 and; a rural Oklahoma provider designed the country's first medical cooperative.' This innovative arrangement not only provided capital for a new health center by selling $50 membership shares, but also provided the prototype for a more theoretical or thorough delivery system, encompassing in its mission: group practice, prepayment, preventive medicine, and consumer participation.4

Today, after almost a century of development, managed care has evolved into a great number of different shapes, yet still has not evolved much. Increasing economic polarization of the population combined with ballooning costs, tangled administrative systems, and generally immature policy mean that soon, something's got to give. Interestingly, it is possible that in the coming era, the very market that now actively alienates consumers may be courting them instead.

In consumer-driven care, it is predicted that change will come simply because people will have the informational resources and the sense of control over their cash to demand more customization or options, creating essentially a buyer's market. Health care can be paid for after the fact more efficiently, and financial services companies are scrambling to offer Health Savings Accounts.

Even some physicians are responding to (mis)managed care by independently practicing cash-only businesses that are able to offer reasonable pricing because of the lower overhead.5 Going further, for an annual fee, other providers have started boutique' practices, featuring quick appointment availability and nominal wait times.

The phenomenon of medical tourism is growing too, as people realize that the procedure they need could be done just as well in India, for instance, for a portion of the price, while the other governments, such as India's, realize the profit to be had from it.6 For those that stay with a reimbursement plan, the advent of an outside representative entity who is entrusted with the fair delivery of their care, may be what keeps them there.7 A demand for cost transparency is rising as well,8 especially as emerging specialty practices can leave less profitable ones wanting, and the subsidies created within a network system are being questioned.

And in another hundred years, what will managed care look like? It will be interesting to see.

REFERENCES:

(5-8) Scandlen, Greg, "Consumer-Driven Health Care: Just A Tweak Or A Revolution?" Health Affairs Vol.24, Iss. 6, Nov/Dec 2005, pg. 1554, 5 pgs.

(1-4) Radich, Amy E., M.S. IV, for the Ohio University College of Osteopathic Medicine. A Brief History of the Healthcare Industry in America (electronic version). Retrieved August 01, 2006, from http://www.ooanet.org/pubs/ouc omhealthcaresummary.htm.

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