Modern Physician's February issue contains several articles relating to the recent AAPCC rates offered by Medicare. Conceptually, if managed care is a viable cost saving option, then a 5% competitive advantage should be more than enough to ensure success. However, the AAPCC rates do not encompass all the administrative costs necessary to administer managed care. Thus, the competitive value of managed care must be greater than the 5% discount offered by HCFA. As the low-hanging fruit of managed care gives way to patient backlash and alternative pharmaceutical interventions, costs will rise -- a phenomenon seen in the commercial market.
Thomas Barela, M.D. Phoenix, Ariz.