THE SOUL OF AN HMO

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It is here in the realm of leading-edge medical technology that the culture clash between the new medicine and the old becomes most evident. The new medicine, by its nature, abhors complexity and innovation. Health Net, for example, won't cover any treatment it deems to be experimental or investigative, even though its contract with MediCal, California's Medicaid program, does cover visits to acupuncturists and faith healers. Like other HMOs, it spends nothing on research to hunt for new treatments for disease. In fact, it feels bound by law and competition to avoid such research.

Recently, for instance, Health Net rejected a proposal to set aside money to study ovarian cancer, arguing that such an investment might leave the company vulnerable to a charge under the Americans with Disabilities Act that it was discriminating against people with other diseases. "If we put money into ovarian-cancer research and word gets out, then it isn't going to be long before aids groups or prostate-cancer groups start having a field day," says Lyle Swallow, Health Net's cheerful associate vice president for legal services. "I didn't like having to give that advice, but it's another rock and a hard place."

The company fears too that in a market such as California, spending on research would create a competitive disadvantage. "One thing I have to insist on as a company is a level playing field," says Health Net's Dr. Popik. "I can't afford to pay for it if my competitors won't pay for it. If you want to do it through a tax, that's fine."

Under the old medicine, research hospitals paid for clinical research through billing surpluses; grants from the National Institutes of Health tended to pay only for big-ticket basic science. Colorado's Dr. Jones accuses HMOs of placing medicine in a double bind. "Is it reasonable," he asks, "for an insurer to demand the gold standard of proof and simultaneously refuse to pay for patients to enter a trial to get that level of proof?" Dr. Jones is convinced that women who once would have come to him for a transplant aren't coming because their doctors, operating under tight managed-care cost guidelines, aren't telling them that transplants are a medical option. "You put yourself in a position where you don't discuss it, or else discuss it and, worse yet, indicate that all the data is negative or that there is not a significant amount of data about this, I think you've irreparably damaged the very thing that makes you as a physician so valuable to patients."

Dr. Popik sees it a bit differently. "What should happen," he says, "is that a physician shouldn't create an expectation for a patient. Because once that expectation is completed, you start a process that is extremely difficult to change." He adds, "There are other ways to give people hope. And that's the paradigm shift."

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