Under pressure to keep lowering expenses, health plans focused more and more attention on cost control, often to the exclusion of everything else. Pressured by rising medical costs on one side and employers' refusal to pay higher premiums on the other, a number of managed-care firms began running into trouble. Wiggins was forced to resign, but that wasn't the end of his troubles. Last week the New York State attorney general's office confirmed to TIME that it was investigating Wiggins for possible insider trading. But that assumes there is competition and free choice.
Most employers let their workers choose from only a handful of plans.
Industry consolidation, meanwhile, is reducing competition even further. From his ranch in Wyoming, Ellwood sounds like a broken man, and in a too literal sense he is. He was thrown from a horse last month, fracturing his neck. The painful healing process has given him a lot of time to consider how disappointed he is with the system he helped create. The form it took, driven by employers, is competition on price alone.