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Ethical Issues in Managed Care Organizations

Managed care organizations (MCOs) have a duty to the public, which they need to fulfill by overcoming the issue of profit vs. healthcare. MCOs are not inherently evil; however, a lot of them have policies that are made along the way to create more profit and in turn, become an ethical issue, let’s look at two of them:

Conflicts of obligation and conflicts of interest are the first things that come to mind when looking into ethical issues. Healthcare facilities have operational costs that can end up being quite high. For instance, let’s look at hospital stays. Hospital stays cost a lot for the hospital management, so let’s say that a hospital gets the opportunity to decrease the cost of medical care by reducing the number of days a patient is allowed to stay in the hospital, and as a result, it’ll create more money to take home. However, there is a conflict of interest here: make the patient go home sooner and, consequently, take home more money. You need to tell the patients why this policy is being implemented… or you could not tell them at all. The conflict of interest is where the ethical issues arise since there seems to be no acceptable way to tell a patient that you are reducing their stay to increase your profits. You can’t just implement the policy without letting your patients know as it is ethically wrong. (The Cary M. Maguire Center for Ethics and Public Responsibility).

Professional character is another issue when financial gain is the motive. Finance gain is a very serious ethical issue in some cases where MCOs require physicians to treat a certain number of patients in a day to gain more money. Financial Incentives bring into question the professional character of a physician as he/she may be putting a patient’s life at risk for a few extra bucks. Professionals are humans just like us and are thus not immune to the incentives (The Cary M. Maguire Center for Ethics and Public Responsibility) (Larson, 2013).


Larson, J. (2013, March 6). Five Top Ethical Issues in Healthcare. Retrieved from AMN Healthcare:

The Cary M. Maguire Center for Ethics and Public Responsibility. (n.d.). Managed Care: Some Basic Ethical Issues. Retrieved from Southern Methodist University Web Site:



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