Reflective Choice in Health Care: Using Information Technology to Present Allocation Options

Abstract:     
The recent explosive growth of managed health care has occurred in large part because of a recognition that we need to make cost-benefit trade-offs in health care. Managed care plans typically make cost-benefit trade-offs by giving plan physicians financial incentives to reduce medical spending or by giving third-party utilization reviewers the authority to deny approval for treatments proposed by plan physicians. Yet individuals who enroll in managed care plans generally have little knowledge of how physician financial incentives or utilization review guidelines operate. As an alternative to this type of sub rosa rationing, a number of commentators have argued in favor of systems in which patients/consumers would make choices among health plans with explicit rationing schemes. However, one powerful argument that has been advanced against a consumer-choice oriented approach to rationing is that such an approach falsely assumes that consumers can make reflective, autonomy-enhancing choices about their health care priorities. This Article examines the issue of choice with an eye towards determining whether, and how, information technology could assist individuals in making truly reflective health care rationing choices. It argues that information technology could be invaluable in giving consumers a genuine understanding of how different allocational mechanisms worked. Informational technology could also facilitate communication between patients who had chosen a particular allocational mechanism.

JEL Classification: I11, I12

Accepted Paper Series