Conflicts of interest abound in healthcare, presenting major ethical and legal problems. With the exception of insurer-owned healthcare institutions, hospital owners and insurance providers often have competing or conflicting interests. For the most part, though, managing costs is a tremendous concern for both parties. Hospital owners or administrators might be driven more by issues related to overall patient outcomes, human resources management, and organizational culture, whereas insurers frequently seek methods of denying care to better manage their own costs and promote profitability. Insurance companies are generally more transparently profit-driven, with healthcare institutions sometimes claiming to be driven more by the motive to provide care to patients at whatever costs. However, ethically motivated healthcare institutions are becoming less common in the United States as purely for profit institutions have come to dominate the healthcare landscape (Grey, 1986). Healthcare administration education programs have failed to provide competency measures ensuring that the leaders of the future are equipped to mitigate the financial concerns of insurers with the ethical and care-driven concerns of actual healthcare workers and the patients they serve (Huppertz, Strosberg, Burns, et al, 2014). As insurance companies and healthcare administration collude in the creation of a profit-driven model, the quality of care diminishes even as costs rise. As Pfeffer (2014) points out, the United States spends more than twice as much on healthcare, measured both by person and by total percentage of GDP, versus other industrialized nations and yet ranks 27th for life expectancy and similarly low on other public health measures. Insurance providers and hospital administrators frequently work within completely discrete ethnical universes. Clearly, the current system fails to live up to the ethical duties of healthcare, and needs to be radically reformed to provide an overarching ethical paradigm. The Administrator Perspective

Administrators of healthcare organizations are taught, and often profess, to be “moral leaders who articulate the hospital’s mission and vision to the public community,” (“Becoming a Hospital CEO,” n.d, p. 1). For the most part, healthcare administrators will live up to this duty, but when insurance companies own their hospitals or institutions, the mission of the administrator shifts away from a moral message and more towards one that is responsible for meeting financial objectives. Granted, administrators always work with their institution’s Chief Financial Officers because all institutions must work within their operating budgets. Whether the hospital is run as a for-profit or a non-profit matters a lot less than the overall “macro environment” in which administrators operate (Shi & Singh, 2014, Digital Edition). That macro environment is complex and includes medical ethics, legal parameters, reimbursement models, delivery modes, governmental regulations, and a host of other critical variables. Whereas the insurance provider has a much simpler objective, driven by financial expediency, the healthcare administrator has been pulled in a number of different directions, serving...

One of the greatest challenges from the administrator’s point of view is balancing the ethic of beneficence with the responsibility to operating within the institution’s budget.
Patients are essentially clients of the healthcare institution. Like clients who patronize other businesses, patients sometimes want or need medical treatment for which they cannot afford. When those treatments or interventions are medically necessary in an obvious way, the administrator may authorize treatment in spite of the patient’s insurance company having denied coverage. In cases like these, the administrator risks serious financial or political repercussions. Yet withholding treatment from patients based on the insurance company’s reluctance to pay also puts the administrator in danger of liability and malpractice. Insurance companies serve as cost mediators, presumably increasing access to medical tests and procedures that would be cost-prohibitive out of pocket. Each patient has a unique insurance plan, meaning that each patient’s decisions need to be considered independently. From the administrator’s perspective, meeting patient centric-goals is usually a major priority that would mandate the delivery of services. Complicating matters is the fact that administrators are also responsible for meeting specific population health outcomes: the metrics that they can use to show how effective their institution is in offering quality care. To prove to all stakeholders that their institution is meeting its obligation to provide care for patients, healthcare administrators need to offer quantifiable evidence. Patient outcomes can be measured in a number of different ways, though. Some administrators might want to claim that reducing the amount of time a patient has spent in the institution is a key metric; others may focus on mortality rates, others yet on funds allocated to nonessential services. Administrators can easily manipulate their institution’s performance metrics, via institutional policies related to recording data or focusing on only the metrics that matter. As Hailsmaier (2013) also points out, “there are still disagreements over what should be considered necessary or appropriate care, or where to draw the line between personal and collective financial responsibilities,” (p. 1). Both insurance providers and administrators need to decide what procedures and practices constitute essential services.

The Insurance Perspective

Health insurance theoretically “helps keep people functioning normally and it protects their financial security,” (Saloner & Daniels, 2011, p. 815). Unlike healthcare administrators, though, insurance providers do not operate within an ethical landscape. Their businesses are driven by purely commercial reasons, and they are not at the front lines of care. Healthcare administrators work with their teams of doctors and nurses to provide for patient needs, and are held accountable to overarching ethical goals like beneficence, patient autonomy, and non-maleficence. Insurers generally maintain a hands-off approach to ethical questions, deferring that responsibility to the healthcare provider. Instead, the ethical…