25 Creighton L. Rev. 1537 (1991-1992)
Ethical and Legal Remedies to Over-Utilization of Health Care Resources; Verdirame, Karen M.

handle is hein.journals/creigh25 and id is 1559 raw text is: 1537

ETHICAL AND LEGAL REMEDIES TO OVER-
UTILIZATION OF HEALTH CARE RESOURCES
INTRODUCTION
As physicians began to invest in health care facilities for which
they also generated referrals, public examination of the potential for
conflict of interest began to take shape.' Critics argued that self-re-
ferral arrangements necessarily create over-utilization of medical
services resulting in increased costs.2 Although few physicians pur-
posely refer patients to poor quality facilities, if a physician has an
ownership interest in a facility, then that interest may have a subtle
influence on the physician's decision regarding further treatment of
the patient.3 Critics also argued that a physician has a conflict of in-
terest between the legitimate medical needs of a patient and the po-
tential for the financial gain of the physician.4 Advocates of
physician ownership of health care entities argued that such business
arrangements encourage competition, provide services to rural areas,
and   give  much-needed    quality  control of medical service      to
physicians.5
The controversy is now focused on the potential for over-utiliza-
tion and the conflict of interest of physicians.6 Federal and state gov-
ernments responded to the potential for over-utilization by changing
the Medicare and Medicaid programs.7 Legal responses ranged from
advocating a complete ban on some types of investments for health
care providers to accepting self-referral businesses within certain
limited guidelines.8 Medical responses varied over the past decade,
and are reflected in the ethical code of the American Medical Associ-
ation (AMA).9 The response of the AMA has been to adjust the
ethical guidelines regarding its previous position on physician self-re-
ferrals.10 The AMA recently recommended a near complete ban on
self-referral for members of the medical community and sanctioned
self-referral only when a community need exists and when the entity
1. Brammer, Dubious Practice? Radiation Care Is at the Center of the Storm
Over Se-Referrals, Barrons, Mar. 30, 1992, at 10; Iglehart, The Debate Over Physician
Ownership of Health Care Facilities, 321 NEw ENG. J. MED. 198, 198-99 (1989).
2. See infra notes 140-210 and accompanying text.
3. See infra notes 335-38 and accompanying text.
4. See infra notes 373-83 and accompanying text.
5. See infra notes 336-37 and accompanying text.
6. See infra notes 41-50 and accompanying text.
7. See infra notes 51-79 and accompanying text.
8. See infra notes 211-48 and accompanying text.
9. See infra notes 249-79 and accompanying text.
10. See infra notes 265-76 and accompanying text.

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