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Managed Process, Due Care: Structures of Accountability in Health Care


Nan D. Hunter


Georgetown University Law Center

December 2004

Brooklyn Law School, Legal Studies Paper No. 27

Abstract:     
This article examines how legal, political and economic change has produced a new adjudicatory mechanism for resolving disputes between patients and managed care organizations. In 43 states, external review laws allow patients whose claims for care or reimbursement have been denied by MCOs to appeal through a system that uses private judging companies to review the MCO decisions. Most of the claims concern whether a particular treatment is medically necessary, and the external review companies employ a mix of legal and health professionals to make those judgments. In essence, regulation of this critically important aspect of MCOs has been outsourced to a small but growing industry niche, which provides due process lite for patients.

The article begins by describing how a substantive standard of deference to medical authority in tort law leaked into and defined process aspects of health law as well. Then, because of the transformation to managed care models for service delivery, the old deference model fell victim to economic constraints. External review laws were enacted as part of the backlash against the abruptness of that transformation. They emerged from political coalitions searching for a new mechanism of accountability for the private sector.

Second, the article revisits procedural due process theory, which was a vibrant field of scholarship 25 years ago, but which today is virtually moribund. I describe how external review laws illustrate the use of dispute resolution procedures to achieve accountability and the emergence of accountability as a primary process value. I also argue that a second process value reflected in the new external review systems - deliberativeness - may be of equal or greater significance than the right to a hearing, the traditional flash point for debates about process.

Third, I articulate both the link between procedure and regulation, and also the connection between regulation by procedure to theories of governance. Specifically I argue that we can understand the use of adjudicatory process as one technique of governing at a distance, a method through which preferred policies and norms can be advanced indirectly, by non-governmental as well as governmental actors, rather than by direct, command-and-control state policies.

Number of Pages in PDF File: 106

Keywords: health, managed care organizations, medically necessary, due process

JEL Classification: I118, K23, K32, K41

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Date posted: December 6, 2004  

Suggested Citation

Hunter, Nan D., Managed Process, Due Care: Structures of Accountability in Health Care (December 2004). Brooklyn Law School, Legal Studies Paper No. 27. Available at SSRN: http://ssrn.com/abstract=630482 or http://dx.doi.org/10.2139/ssrn.630482

Contact Information

Nan D. Hunter (Contact Author)
Georgetown University Law Center ( email )
600 New Jersey Avenue, NW
Washington, DC 20001
United States
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