This shift in the way medical services are bought and sold has spawned tragic stories of delayed and insufficient care, culminating in demands for legal reforms to curb flaws in these new systems. Several measures pending on both the national and state level would rewrite the legal relationships between doctors, patients and insurance companies. But doctors say insurers dictate treatment by limiting what is covered, and by penalizing physicians who violate treatment guidelines.
Patients exercise control by buying health insurance or going without it.
Under many HMO contracts, an insurer pays member doctors a monthly fee per patient. But when a patient needs to see a specialist, the doctor, not the insurer, pays the specialist's fee. Advocates say this motivates doctors to practice preventive medicine, but critics argue such contracts tempt doctors to delay expensive tests and treatments until a patient is seriously ill. Capitation is only one feature of contracts between HMOs and doctors. Contracts between HMOs and member doctors include treatment guidelines which may limit hospital stays for specific procedures without allowing for variables among patients, and may go as far as defining what may be written in patient charts.