Journal Title

Boston University Law Review

Volume

85

Issue

3

First Page

553

Document Type

Article

Publication Information

2003

Abstract

The Texas Attorney General attempts to regulate managed care organizations and their shifting of financial risk by utilizing Assurance Voluntary Compliance to make the costs associated with the provisions of health insurance more transparent. A primary technique used to shift financial risk to providers of healthcare services is through the use of downstream entities which are commonly provider-sponsored organizations. It is the relationship between the downstream entity and the individual physicians that ultimately affects patient care, the doctor-patient relationship, and the quality of care. The regulatory community throughout the United States has made the regulation of downstream entities its number one priority.

It was in this context that then-Texas Attorney General Dan Morales filed suit against six health maintenance organizations (“HMO”) in December 1998, which ultimately led to the creation of Assurance Voluntary Compliance. The Assurance Voluntary Compliance led to HMO’s introducing “consumer driven” health plans. These new health plans call for the consumer to bear a greater responsibility of risk. In effect, the consumer is being called upon to assume the role of insurer in the consumer’s own health care expenditures. In the long term, it is unlikely that consumers will be able to manage risk, control costs, and ensure quality better than the managed care industry, employers, and health care providers that the consumers will be forced to replace.

Recommended Citation

Andre Hampton, The Princess and the Pea: The Assurance of Voluntary Compliance Between the Texas Attorney General and Aetna's Texas HMOs and Its Impact on Financial Risk Shifting by Managed Care, 83 B.U.L. Rev. 553 (2003).

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