This article was based on a professional paper written in fulfillment of the requirements for Fellowship in the American College of Medical Practice Executive (ACMPE).

An emerging niche market opportunity

Part I

Abstract

Society is split between a desire for access to quality health care and a reluctance, by some, to pay for it. Looking at this cost/access dichotomy historically enables one to recognize an emerging niche market-discriminating, affluent consumers willing to pay for better health care.

The production, marketing and consumption of health care services in the United States is characterized by a marketplace oddity: the separation of the customer from the consumer. These two parties have varied, and often conflicting, economic incentives. The rise of tax-subsidized employer-paid health insurance benefits along with the establishment of the Federal Medicare and Medicaid programs have created this schism. The consumers (patients) want accessible, high-quality health care. The customers (government and employers) want to balance the budget or protect their corporate bottom line. Consequently, a conflict develops: the cost/access dichotomy. This dichotomy describes the dilemma of a society choosing between access to high-quality health care and the cost of maintaining it. Simply, the more access consumers have to high-quality health care, the greater the cost to the customers sponsoring that care. Similarly, the less access the consumers have to low-quality health care, the lower the cost to the customer.

Today's managed care plans have been marketed in the United States by companies claiming their models obviate the dilemma created by the cost/access dichotomy. Corporate proponents say these models lower costs to the customers while maintaining a high level of access and quality for the consumer. Recent surveys refute these claims. Instead, these managed care companies have reduced the actual cost of delivering care by squeezing service providers' fees but have kept these savings for executive bonuses, shareholder profits and increased corporate cash flow. The increased cash flow to these managed care companies has been used to purchase other managed care plans. The result has been increasing market domination by a few large corporate providers and a lower level quality of care for the consumer.

For years health care consultants and executives have preached the value of "service excellence." Unfortunately, as the health care system changed from a cottage industry to a rapidly concentrating one seemingly overnight, the noble ideal of health care service excellence has largely been ignored in practice. Again, recent patient satisfaction surveys verify this. However, the logic of "service excellence" argues that health care services have become a virtual commodity to the sophisticated consumer. Thus, consumers evaluate health care services as they would assess the value or quality of any other consumer good or service.

The traditional product design of the health care services industry has been the standard "one size fits all" approach, borrowed from the marketing tactics of Henry Ford when he stated over 75 years ago: "You can have any color Model T as long as you want black!" Since Ford's famous statement, every sector of the United States' consumer goods and services economy - except for health care services - has advanced its thinking with regard to product design, development and delivery. Consequently, today's nonmedical consumers are nearly overwhelmed with choices.

Many of today's most successful companies have chosen a segment or "niche market" for their product design and distribution. These companies target a certain narrow demographic as their market. This article presents the argument that the medical services industry needs to recognize and exploit the opportunities presented by this "niche" approach.

Consumer dissatisfaction with the access to and quality of their health care services will continue to increase as the industry furthers its concentration. This article predicts that emerging from this dynamic will be a minority of affluent consumers, dissatisfied with the relative unavailability of quality health care services, who will actively seek options.

This article identifies a niche market business opportunity that exists for the development of boutique medical clinics to service these defecting, affluent consumers. These clinics will offer a top quality designer product that is customized to the individual, using the tenets of Learned Relationship Marketing coupled with powerful information systems. These clinics will be exclusive to consumers willing to pay for services without discount and without regard to insurance coverage. These consumers will most likely be those who live in the upscale ZIP Codes; who are comfortable in country clubs, private schools and expensive automobiles. These boutique medical clinics will be for those who demand service that is individualized and of the high level of quality that they expect from all their other consumer purchases.

This article will be delivered in two installments. The first installment will present the historical elements that led to today's health care delivery system architecture. It concludes with the prediction of a new business opportunity: The emerging niche market of affluent, disenchanted health care consumers that is a logical result of the dynamics of our current health care delivery system.

The second installment will present ways to successfully penetrate this niche market. The major facets of a new health care product targeted to this niche market - designer care, delivered in a boutique setting - are described and a clinic operations example is given. The principles of Learned Relationship Marketing are presented as the product design philosophy of the services rendered to the consumers in this niche market. The concepts of Interactive Dialogue, Mass Customization, Share of Customer and Lifetime Value are explained as well.

An historical perspective
By the middle of the Twentieth Century, indemnity health insurance instituted along professional lines and the defeat of prior efforts to legislate national forms of social insurance nearly completed the health service infrastructure. The nature of this infrastructure can be characterized as a professional-driven health care system. At the heart of the system is the goal to provide the best possible clinical care to every sick patient where physicians choose to practice. Complementary goals include the development of scientific medicine to its highest level and the protection of the autonomy of physicians.(1)

These goals led to excesses and distortions that resulted in widespread discontent and revolt by consumers and customers. This was the irony of success. For example, professional goals lead to emphasizing state-of-the-art clinical interventions but ignoring primary care and prevention. Costs rise sharply, especially if reimbursed by provider- controlled insurance. Physician autonomy at the clinical level leads to fragmentation and underserved areas at the system level. An integrated delivery system that equally serves rural and inner city patients would require a loss of the provider's autonomy.

Thus, the resulting system consists of a loose federation of local in-patient and out-patient facilities organized around physicians' preferences, with weak ties to societal needs. Power centers on professional associations, which in turn use the legal powers of the state to enhance their position while protesting state interference in the practice of medicine.(2)

A call to reform
The 1970s opened with criticisms against over-utilization, inefficient hospitals, the proliferation of specialists, the lack of primary care and the neglect of the poor despite Medicaid. From every sector of society arose cries for national health insurance and a total revamping of what was seen as a wasteful system.(3)

Numerous proposals for national health insurance, combined with reforms to contain costs, were made. President Nixon promoted the growth of HMOs. Congress passed several bills to control costs through regulation. Health Systems Agencies, Certificates of Necessity and Professional Services Review Organizations were mandated. These bureaucracies lacked the powers of enforcement and had loopholes which were exploited.

After years of efforts through competition and regulation, the United States still had not restrained health care costs. Rather, revenues to the medical industrial complex had risen from 7.6 percent of GNP in l970, to 9.2 percent of GNP in l980, to 12.1 percent of GNP in l990. Employers' costs to maintain employee health care benefits equaled 100 percent of their post-tax profits(4)

The growth of managed care companies
Managed care today enrolls the vast majority of the employed insured population and is growing rapidly among the Medicaid and Medicare population. In Los Angeles, San Francisco, Minneapolis and Boston, HMOs currently enroll over 50 percent of the insured population. Cities with a shorter history of HMOs have seen enrollment double in one to two years. Nearly 70 percent of workers in firms with more than 200 employees are now in managed care plans.(5)

The managed care industry has shifted from non-profit organizations to for-profit, publicly traded, investor-owned firms. As a result of sales and conversions as well as the entry of investor-owned companies, the non-profit share of HMO enrollment dropped from 74 percent of the industry in 1985 to 42 percent by 1994.(6) New fortunes were created as a result of buying and selling plans.

A further shift has occurred in the geographic base of parent plans. Where plans initially formed around local physician and hospital networks, mergers and acquisitions have given rise to large national plans. Employer demands for fewer plans covering broader markets are increasing market pressures that favor size over past performance. Plans also see size as a competitive advantage in negotiations with physicians and physician/hospital groups.

Minnesota Citizens Organized Acting Together (COACT) finds that consolidation has occurred to such an extent that just four vertically integrated managed care companies now provide 80 percent of the medical care for Minnesota residents. It points out that the latest studies of cost by the Health Care Financing Administration and Physicians Payment Review Commission found that Minnesota's health care costs are now 5 percent above the national average.

In addition, COACT is concerned about heavier provider workloads, decreased health care quality and the undue political influence of new networks on health care policy decisions made by the state legislature. The Basic Health Care Action Group, composed of 22 large corporations in Minnesota, also is concerned over the economic concentration of insurance power in the state and is planning to contract outside these networks beginning in 1997.

Given the penetration of HMOs into private-sector insurance around the nation, it is important to remember that while their initial bargaining power helps curb costs, these cost savings are blunted as their economic control increases. It is no surprise that a state's insurance system can be dominated by a few strong companies, thus rendering it an oligopoly.(7)

The impact of managed care companies
The Clinton reform proposals accelerated efforts by managed care corporations to attain market control as oligopolies in their principal markets before any political solution was chosen. Thus, the landscape of health care has radically changed. As the drive for national health reform was collapsing, managed care corporations made a fierce and successful effort to win deep provider discounts and drive down hospital admissions. In areas where they had high market penetration, they succeeded and saved billions of dollars of the premiums they collected.(8,9)

The principal force behind reducing use and actual cost in the 1990s has been for-profit middlemen, not employers or Medicare. Many of the major HMO corporations actually provide no health care. These are the new-breed HMOs that are packagers, not health service organizations. They take fixed premiums in, pay provider groups under deep-discount contracts, and keep 18 percent to 34 percent for themselves. Thus, the managed care revolution of the l990s is largely a matter of transferring billions of dollars from providers to executive management teams and investors.(10)

Insurance companies make their money from limiting care to patients and by obtaining increasingly large discounts on services from providers. Insurance firms spare no effort to curtail the amount of money spent on patient care, and yet they have no qualms about huge profits and paying their executives outrageously high salaries. For example, the cash and stock awards to each of the chiefs of the seven largest for-profit HMOs averaged $7 million in 1994.(11)

Pricing and skimming schemes
Pressure on national-based HMOs to grow appears more motivated by being in a position to exert market power than by gains in plan ability to provide quality care or to invest in internal systems.(12) These national-based HMOs have the resources to drive better performing but smaller HMOs out of business. A Harvard-Commonwealth Fund study noted, "HMOs with inferior reputations used their significant financial resources to engage in predatory pricing. In at least one market, there is concern that the best-performing HMOs may not be the ones that survive."(13)

HMOs are increasing their market share by offering premiums that rise more slowly than other health care models so that costs initially decrease and grow more slowly than in traditional programs. In a marketplace where the annual growth rate of health premiums in general has been 6 percent to 8 percent and where there is a strong presence of traditional indemnity and discounted fee-for-service product competition, the HMO sales tactic is to "shadow" their competitors' pricing bids on the low side.

However, HMO pricing has little to do with true cost accounting, because the amount HMOs actually spend on medical care is decreasing. The national consulting group KPMG has reported the costs of HMOs providing care decreased from 82 percent of premiums in 1990 to 75 percent of premiums in 1994.(14) Thus, the HMOs price their products in the "shadow" of their competition and realize the increasing profit spread between their decreasing costs and the market's rising premiums.

Even more than the early HMOs, today's managed care companies use tactics that defy regulation to avoid sicker subscribers. According to physician-researchers, they "place sign-up offices on upper floors of buildings with malfunctioning elevators; refuse contracts to providers in certain neighborhoods; structure salary scales to assure a high turnover among physicians; provide luxurious services for the well and shabby inconvenience for those with expensive illnesses so that they will disenroll."(15)

Given that just 10 percent of the population consume 72 percent of all medical costs, risk avoidance is the quickest and easiest way to profits. As a result, society pays twice: once for the high risk people concentrated in high cost plans, and again for the excess profits in plans that succeed in risk selection.(16)

Consequently, the competition between HMO companies and traditional medical insurance companies does not create savings, it increases the cost of health care delivery. HMOs continue their skimming tactics while shadow-pricing the premiums of their competition. This means healthy profits for the HMOs and rising costs for employers as they pay for their sicker employees in the open-ended traditional plans. The syndrome feeds on itself: The more that the sicker employees get left in the traditional plans, the faster their premiums rise and thus the faster HMO premiums rise as a shadow price, resulting in employers paying more overall.

Congress is acting out the same ironic syndrome. It is rapidly pushing the elderly and the poor into managed care systems, while it is poised to make large cuts in the budgets for both Medicare and Medicaid. Put these together and it means that for-profit organizations with an unclear track record of saving money but a good track record of making money are in charge of rationing care to fit within reduced budgets for the elderly and the poor.

One could conclude that we are in the middle of a shakedown period in which there is fierce competition between managed care systems for control of large regional and national markets. Most of the health care "savings" will go to the 20 percent to 34 percent these companies take out of every premium dollar to run their systems. But soon, there will be only a few major health care corporations in most markets, and as oligopolies they will not compete much on price.

Overall savings, if any, will occur largely during the initial shakedown period, and then the consumer and customer will be stuck with profit hungry multibillion dollar corporations in control of the health care delivery system. The effects of public stock offerings, mergers and acquisitions, discounting, patient skimming and shadow pricing will run their course. Then the managed care corporations will have to extract profits from direct patient care. Evidence indicates this is already happening.(17)

Consumer dissatisfaction
In a recent consumer survey exploring the credibility of various business and government organizations, the managed care industry was rated near the bottom, only slightly higher than the tobacco industry.(18) This survey finding is emblematic of many recent polls describing today's consumer attitudes regarding managed care.

A Commonwealth Fund survey of managed care enrollees found they were 2.5 times more likely to rate the quality of services as just fair or poor, and over 4 times more likely to rate their doctors as fair or poor compared to enrollees in traditional plans. Remarkably, people in managed care plans were just as likely to report not having a regular source of care, not getting preventive services, and postponing needed care - just the problems that managed care is supposed to solve.19 Worse, studies have shown that managed care's sickest patients get poorer care than those covered under traditional plans.(20,21)

A longitudinal study in Boston, Chicago and Los Angeles followed 1,208 chronically ill patients with hypertension, diabetes, heart disease, depression or a combination of these problems. The patients were divided into fee-for-service or prepaid care groups. Those in the prepaid group had reduced physician continuity and a less comprehensive level of care. More patients reported access difficulties, such as obtaining emergency care, or seeing a doctor when they thought they needed one, with the prepaid plans. The study also included home health care services and it was reported that outcomes of home health care are superior for Medicare fee-for-service patients when compared with Medicare HMO patients.(22)

Concerning access, managed care enrollees were much more likely to rate ease of changing doctors, choice of doctors, access to emergency care and waiting time as only fair or poor. Forty percent had to change their doctors when they joined their current managed care plan. Discontinuity of care was directly related to their dissatisfaction. Yet employers and employees are constantly pressured by plans to switch for short-term gains or inducements.(23)

Discontinuity of care
Continuity of care is the ongoing relationship between the patient and his primary care provider and the cornerstone of health care. It is one of the most valuable tools a patient has in the preservation and maintenance of health.(24) However, employers are switching health plans for their workers as often as every 18 months. "How can you advocate for a patient when you don't know him?" asks Susan W. Tolle, FACP, director of the Center for Ethics in Health Care at the Oregon Health Sciences University. "Particularly when all the pressures are for you to think in terms of your entire patient population or to think like the medical director."(25)

Health plans are competing with each other to deliver care at the lowest cost, in response to employers who want lower health care premiums. Corporations used to buy health care insurance for employee retention. However, as health care costs increased, the premiums became a liability to corporations trying to stay competitive; a drain on their profitability. Today's downsized companies show little allegiance to their employees. Moreover, they show less loyalty to the companies from which they purchase their insurance. If they can save money or offer a more favorable report to their shareholders, they will do so.

Yet each time a company changes its health plan, employees wind up with a new panel of providers. In many cases, employees have to select a primary care physician who participates in their company's health plan. If they want to stay with the doctor they already use, they typically must pay more.(26) In addition, the use of capitated payment leads to the development of "price-driven" networks of specialists.(27) Observers have expressed concern that cost considerations rather than quality or continuity of care have become of paramount importance in subcontractor arrangements, often creating unstable and unsound networks that disrupt care for HMO members.(28)

Trust and ethical issues
There is economic disincentive for managed care insurance carriers to take the long view (a patient's lifetime) when deciding on treatment. However, there is significant economic advantage for them to put a treatment decision within the context of the expected lifetime of the contract they have with the patient's employer. As the health care marketplace environment has shifted from being professional-driven to one that is corporate-driven, there has been a subtle shift in the way treatment decisions are made. Payers, rather than providers, have become the prevailing authorities in prescribing treatments. As a consequence, treatment decisions are more cost driven than before, leading to sub-optimal care that at times causes death. Unfortunately for the consumer, managed care companies are not bound by the Hippocratic Oath.

Sophisticated health care consumers will become increasingly aware of the consequences of the cost/access dichotomy. They will realize that at the provider level, the patient becomes a cost center. They will understand there is a disincentive for their provider to treat, and the sickest patients who need health care the most become pariahs of the system. The consumer will find the cash bonus incentives that professional providers have under managed care compromising to their well-being. These consumers will begin to question the motives behind their prescribed treatments. They will begin to not trust their providers or the organizations that hire those providers.

Managed care provider agreements raise a critical concern for the providers' continued autonomy to act as the patients' advocate. Access to and quality of care rely heavily on physicians acting as professionals on behalf of their patients, with the freedom to make clinical decisions independent of personal interests or corporate concerns.(29)

Whereas providers in a fee-for-service setting have financial incentive to provide excessive services, providers practicing in a managed care environment often face financial incentives to reduce the services they provide. The ethical challenge for the professional is to resist both sets of pressures.

Providers must often play multiple roles and express multiple loyalties in the same situation, such as patient advocate and gatekeeper to health care resources. These different roles can create ethical conflicts. Therefore, health care delivery provider agreements should be constructed in such a way as to reduce the occasions when providers must play conflicting roles.

The ethical conundrum of gatekeeper versus patient advocate that managed care providers face is exacerbated by various "gag clauses" written into many provider contracts with HMOs.(30) The AMA has declared gag clauses an unethical interference in the physician-patient relationship. They found that "the physician's obligation to disclose treatment alternatives to patients is not altered by any limitations in the coverage provided by the patient's managed care plan. Patients cannot be subject to making decisions with inadequate information. That would be an absolute violation of the informed consent requirements."(31)

Our present situation
After reviewing the reasons for consumer dissatisfaction with managed care wrought by declining quality of and access to services, discontinuity of care, ebbing trust in provider-prescribed treatments, along with the ethical quagmire in which many providers find themselves literally bound and gagged, one could conclude that corporate managed care has not been beneficial to the consumer.

It appears that the power shift from a professional-driven health care delivery system to a corporate-driven one has resulted in no savings to the customers, but rather a shifting of dollars from providers to management teams and shareholders. However, evidence shows that the actual expenditures for health care services have declined when measured as a percentage of premium dollars paid to the managed care companies. Thus, in the context of the cost/access dichotomy, as the actual cost for health care services declined (managed care companies paid out less of the premium dollars they received), the consumers' access to quality services also declined. This describes our present situation.

The Swedish, British and Canadian experience
The United States is not the only industrialized Western society experiencing problems with its health care delivery system. Sweden, the United Kingdom and Canada have similar problems managing the cost/access dichotomy, even though their systems are socialized. Government (customer) spending cuts in these countries have produced declining rates of access to health care. It is not uncommon for consumers to wait three years for a hip replacement or 18 months for a hysterectomy or cataract surgery. About 25 percent of all coronary artery bypass surgeries are privately paid for by the consumer in the UK and Sweden. The citizens of these countries perceive a drop in the quality of their health care providers' services as well.(32)

The economic rationing of procedures and the relative drop in the quality of services in these countries have fueled the rise of "privatization." Some patients will not wait in "queue" for procedures; they will not tolerate the ambiance of socialized medicine's waiting rooms and hospital wards. Instead, they seek private providers who perform the procedures they want - on demand - in a setting they find appropriate and comfortable. These private providers practice outside their countries' socialized systems. The patients are wholly responsible for the payment of these services.

Patients who are treated by private practitioners in Sweden represent about 11 percent of the patient population. United Kingdom patients receiving private care outside the National Health Service total 18 percent. Canadian patients receiving private services outside their Medicare system may run as high as 28 percent.(33,34)

Thus, in each of these countries, where health care is a social welfare benefit, there is a certain percentage of the population, characterized as affluent, that is willing to pay out-of-pocket for medical services.

The opportunity
A niche market is defined as a targeted set of consumers, sharing similar demographics, which has needs sufficiently different to separate it from a broader market. The factors promoting the existence of a new niche market are:

• A decrease of real costs of health care services delivery;
• A decline in the quality of care delivered;
• Providers who are available to service the niche market; and
• A population of affluent consumers.(35)

In certain identifiable regions of the United States, where market penetration of managed care is high, there are two important by-products caused by this level of penetration that aid in the creation of this new niche market. First, there is a significant, addressable number of patients who have become dissatisfied with the quality of care available to them. Second, there exists a group of professionals who are excluded from the provider panels of these managed care companies, who will seek greater personal and financial rewards from optional practice opportunities. This satisfies the third requirement for the existence of a new niche market.

Last, consumers with household incomes over $70,000 are considered "affluent" by marketers and make up 13 percent of the total U.S. population. Studies show the affluent consumer is more likely to shop in specialty stores (boutiques), and is twice as likely to purchase customized products than consumers with lower incomes. Additionally, the affluent shun discount retailers.(36) These traits are significant to the entrepreneurs of Individual Care, or I-Care (a business entity created in this article for illustration purposes).

Although they constitute only 13 percent of the U.S. population, these affluent households usually aggregate in certain identifiable ZIP codes, creating a density of per capita affluence that exceeds the norm. A statistical union of ZIP Codes known to have a density of affluent households with ZIP Codes known to have significant penetration of managed care will define the precise locations of I-Care's niche market territories.

Thus, all the preconditions for the existence of a new niche market have been met. Following the tenets of the cost/access dichotomy, the lower true cost rate of health care services delivery has spawned widespread consumer dissatisfaction with their access to and quality of available services. Managed care selection processes and reimbursements have created a pool of providers that is available to service the defecting, discriminating and affluent health care service consumers who will pay for a better option. This describes the new niche market opportunity.

The second installment of this article will explain how to successfully penetrate this opportunity.

References
 

1. Anderson, Odin W., "Health services in the United States: A growth enterprise for a hundred years," Health Politics and Policy, 2d Edition, Delmar, Albany NY, 1991.
2. Coburn, D., Torrence, G.M., and Kaufert, J., "Medical dominance in Canada in historical perspective: Rise and fall of medicine?," International Journal of Health Services, 1983, 13(3): 407-432.
3. Fortune, Special Edition on "Our ailing medical system," January 1970, entire issue.
4. Bruner, S.T., Waldo, D.R., McKusick, D.R., "National health expenditures projections through 2030," Health Care Financing Review, 14:1-29, 1993.
5. Group Health Association of America, 1995 National Directory of HMOs, Washington DC: GHAA, June 1995.
6. Ibid.
7. Fitzgerald, Brenda, MD, "Reforming Medicare: What Congress can learn from the health plans of America's corporations," The Heritage Foundation, Backgrounder No. 1059, October 30, 1995.
8. Litman, Theodore, "The restructuring of the American healthcare system," Essay based on his chapter (3) in the forthcoming text Health Politics and Policy, 3d Edition, edited by Donald W. Light, Delmar Publishers, Albany, New York, 1997.
9. Kane, Nancy M., Turnbull, Nancy C., and Schoen, Cathy, "Markets and plan performance: private summary report on case studies of IPA and network HMOs," Department of Health Policy and Management, Harvard School of Public Health and The Commonwealth Fund, January 1996.
10. Litman, op. cit.
11. Cooper, Joel R., "Restoring the sanctity of the patient-physician relationship," The Medical Reporter, August, 1995, Vol. 1, No. 5.
12. Kane, Nancy M., Turnbull, Nancy C., and Schoen, Cathy, op. cit.
13. Fitzgerald, Brenda, MD, op. cit.
14. Ibid.
15. Woolhandler, S. and Himmelstein, D.U., "Clinton's health plan: Prudential's choice," International Journal of Health Services, 24:583-592, 1994.
16. Employee Benefit Research Institute, EBRI, "Sources of health insurance and characteristics of the uninsured," Washington, DC, p. 586., 1995.
17. Litman, op. cit.
18. Porter/Novelli, A copy of the survey results is available to corporations by writing: Cara Cohen (ccohen@porternovelli.com), Porter/Novelli, 437 Madison Avenue, New York, NY 10022.
19. Davis, Karen, "A survey of patients in managed care and fee-for-service settings three-city survey finds working Americans dissatisfied," July 1995, The Commonwealth Fund, One East 75th Street, New York, NY 10021-2692 USA.
20. Harvard School of Public Health and Louis Harris and Associates, with funding by The Robert Wood Johnson Foundation, June 28, 1995, "Sick people in managed care have difficulty getting services and treatment," Princeton, NJ.
21. Ware Jr., John et al., "Health insurance: Comparison of health outcomes at a health maintenance organization with those of fee for service," Lancet I, 8488, (1986), pp. 1017-1022
22. Fitzgerald, op. cit.
23. Davis, Karen, op. cit.
24. Cooper, op. cit.
25. Gesensway, Deborah, "Who's responsible for the ethics in managed care?," ACP Observer, May 1995 .
26. Cooper, op. cit.
27. Fitzgerald, op. cit.
28. Kane, Turnbull and Schoen, op.cit
29. Davis, Karen, Schoen, Cathy, op.cit.
30. Kritz, Fran, "Physicians fear 'gag' clauses in HMO contracts may impede care," Medical Tribune, December 21, 1995.
31. Cooper, op.cit
32. Rosenthal and Frenkel, "Privatization in the Swedish and British health care systems: Lessons for the United States," Journal of Medical Practice Management, spetember-October, 1993.
33. Ibid.
34. Gray, Charlotte, "Public versus private care: Philosophy, not economics, is shaping the debate," Canadian Medical Association Journal, 153: 453-455, 1995.
35. Rosenthal and Frenkel, op.cit.
36. Lucas, Bill, "Affluent consumers: A sound investment for today's marketers," Insights, Syndicated Services, http://www.npd.com/afflu.htm, 1996.

    This article was based on a professional paper (or case study) written in fulfillment of the requirements for Fellowship in the American College of Medical Practice Executive (ACMPE).

    Michael J. Pulaski, FACMPE, is CEO at Peachtree Orthopedic Clinic, and may be reached at:  mjpulaski@earthlink.net