Yesterday I explained how Obamacare (the Affordable Care Act, or ACA) uses the regulatory principles of “new governance”—public-private partnership, benchmarking, and stakeholder participation—to ensure a “higher quality” of health care delivery. Today I will argue that this goal is problematic, given the complex realities of health care and the medical profession.

In many ways, since no federal bodies have the authority to regulate medical practice directly, any federal regulation of medical-care quality requires an indirect regulatory model of governance. This dynamic makes new governance attractive.

However, while new governance might seem like a good way to regulate medical practice nationally and ensure high-quality health-care delivery, a collaborative and decentralized governance approach is ill-suited to the goal, because there is insufficient normative agreement about what “quality” health care even is. Furthermore, ACA’s focus on benchmarking undermines the status of medicine as a learned profession, and makes possible many bad consequences in the costly field of malpractice litigation.

What Is “Quality”?

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Part of the problem with trying to improve medical care is that medical care’s “quality” is famously difficult to define or measure. Quality simply doesn’t have one definition in medicine, and any efforts to establish one for regulatory purposes will provoke serious disagreement among interested parties.

Defining medical care’s quality hits intuitive hurdles. Obviously life-saving treatment is good, while quackery is bad. But what about medical interventions between those poles? Even at those poles there are problems: Is a life-saving treatment that causes suffering “high quality”? What about a life-saving but resource-intensive treatment? Is a treatment that reduces suffering but lowers life expectancy “higher” or “lower” quality than one that extends life but reduces the patient’s capabilities? When one adds to this mix the fact that practitioners will always have imperfect information about the patient’s physical condition (let alone his goals, interests, or desires), the trouble with evaluating medical quality objectively becomes clear.

Still, Americans have long made efforts to systematize medical-care quality. The more sophisticated methods have involved multiple levels of analysis—such as investigations of process, structure, and outcome. In a process-structure-outcome analysis, process is studied through direct observation or amassed research, while structure involves more stable factors such as tools and resources available, facilities, and organization. Process and structure are examined as complementary aspects of quality, all with an eye to proper “outcomes.”

While compelling in its multifaceted approach, the process-structure-outcome measure of quality still has certain problems. Put simply, often there is simply no “best” process. As economist Alain Enthoven has noted,

There is considerable disagreement among doctors because there is, in fact, a great deal of uncertainty about the answer. Because of these uncertainties, there is wide variation among doctors in the tests ordered for similar cases and in the treatments prescribed . . . . What is “best” in a particular case will depend on the values and needs of the patient, the skills of the doctor, and the other resources available.

Though we have developed methods to increase the store of applicable scientific knowledge—in particular the randomized clinical trial—these instances are few and far between, given the scope of medical practice. The majority of medical practice remains individualized, where the products of rigorous randomized clinical trials give way to subjective decisions about their benefit for patients.

The factors that go into “structure” involve both real and opportunity costs, which make their measurement possible, but difficult. Outcome, on the other hand, is an almost entirely subjective assessment.

Indeed, as Enthoven argues, “The quality of the outcome depends a great deal on how the patient feels about it. What is an annoyance for one patient may mean the inability to keep a job for another with the same condition.” This basic subjectivity renders any analysis of “change in a patient’s health”—beyond simply noting the change—of limited value.

Absent normative agreement about the nature of high “quality” medicine, there will only be agreement among those in charge of the indirect-regulation regime (e.g., those proposing the new benchmarking methods), which will ultimately conflict both with the traditional practice of medicine (individualized practice informed by scientific knowledge) and its realities (the subjective evaluation of outcomes). Dynamic collaboration cannot happen unless the parties agree on the aim of their collaboration.

Professional Autonomy and Benchmarking

The medical profession is that: a profession. Its practice requires specialized knowledge, transmitted from one generation of professionals to the next. This knowledge is cultivated over time and used to develop specific skills. In building and using this knowledge, professionals are generally given a fair amount of leeway and have traditionally engaged in peer regulation. External “scientific” benchmarking limits professionals’ autonomy to make judgments in their practice.

Paramount to the professional practice of medicine is clinical experience. The classic study of medical students, Boys in White, describes this as

actual experience in dealing with patients and disease . . . [which] even though it substitutes for scientifically verified knowledge, can be used to legitimate a choice of procedures for a patient’s treatment and can even be used to rule out use of some procedures which have been scientifically established.

The effects of this applied clinical experience are important (i.e., broadly speaking, does the patient improve?), but arriving at these proper outcomes is not simply a matter of applying input treatment P and receiving desired outcome Q. As we saw, what even constitutes a desirable outcome is a complex and subjective question. It is that subjectivity and concomitant reliance on professional judgment that yields the cliché that medicine is “an art not a science.”

But cliché though it may be, it’s true. Medical knowledge is merely the baseline prerequisite of medical practice. The reason one goes to a medical doctor is for the application of that knowledge according to his professional judgment. WebMD has knowledge; a physician has clinical experience.

Concerns about benchmarking that arise from this view of medicine have been brushed off by Obamacare supporters. ACA advocate and law professor Barry Furrow has dismissed them as “this larger issue of physician resistance to change.” But his words misstate the problem. Physicians are not “resistant to change” out of some lazy inertia; they are, rather, confident in what they have learned through practice and in their medical judgment. That confidence—not mere stubbornness—is what conflicts with abstracted best-practice benchmarks.

If these new benchmarked approaches are to succeed, then, it seems less the case that physicians must merely change their attitudes, and rather that practitioners need to change self-understanding and professional philosophy. For all its decentralized collaborative methods, with ACA the medical profession must be remade in the image of the regulators.

The Impact on Malpractice

National “quality standards” might also present unique questions for the future of malpractice litigation. They could be used to increase physician liability or insulate physicians from liability depending on how states enforce ACA.

The most common malpractice actions are negligence torts. Traditional malpractice analysis employs diverse standards based on geography and training, among other things. But unlike most negligence torts, custom is a defense in malpractice claims. Custom is gleaned from community standards of care, which are determined by inquiring what a doctor of similar training would do in like circumstances.

How will Obamacare’s national standards of care help or hinder the establishment of community standards? That is, how will a jury evaluate expert testimony under the traditional “like circumstances” standard when federal standards will be established under ACA?

At least one of the law’s proponents thinks these standards will help plaintiffs: Furrow speculates that “Plaintiffs’ lawyers will use the findings [of the Patient-Centered Outcomes Research Institute] as at least some evidence of a standard of care, and potentially powerful evidence at that. This is one of the costs of improving medical practice bynarrowing practice variation and medical uncertainty.” Given that conservative estimates put the annual cost of malpractice and defensive medicine at over fifty-five billion dollars, “costs” seems an apt word.

On the other hand, it’s conceivable that these benchmarks could be shields for some physicians just as easily as they could be swords for some plaintiffs. It’s possible that ACA’s national quality-control provisions might open the door for federal preemption challenges of state malpractice claims, which would insulate physicians from liability under local or state standards of medical practice.

Both medical standardization and federal guidelines in other fields already influence state-level tort litigation. On one hand, medical “practice guidelines” are already used to insulate providers from liability, while on the other, federal regulatory regimes such as the Food Drug and Cosmetics Act and the Hatch-Waxman Act can preempt state negligence suits for products liability torts.

ACA’s own preemption provisions do not shed any light on this question, because they do not involve tort liability. Thus, it is possible that when faced with a malpractice claim under state law, as long as a physician has followed the federal quality benchmarks such as the Patient-Center Outcomes Research Institute findings, he or she can point to those findings as a defense against the state-level claim under traditional preemption doctrine—that is, the circumstances under which federal law displaces state law.

The potential to preempt state causes of action would standardize care nationally by standardizing liability. But uniformity in defensive medicine—even if it is defensive medicine according to “best practices”—seems conducive neither to the goals of dynamic experimentalism nor to cost-effective, higher-quality medicine.


Numerous medical-care quality-control aspects of Obamacare reflect a “new governance” mode of regulation. In particular, ACA’s incorporation of public-private partnership, stakeholder participation, and benchmarking are consistent with the dynamic and experimental view of regulation espoused by governance theorists. Of these, however, only public-private partnership is not undermined by the normative underpinnings of medical practice or the existing realities of medical regulation.

In order for new governance to optimize regulatory results, the participating actors need to have some semblance of agreement as to normative goals. In the case of medicine, “quality” is so subjective a concept that such normative agreement simply does not exist, which undermines, for example, the ability to establish proper benchmarks.

Likewise, the traditional conception of medicine as an autonomous profession counsels against external and abstract modes of “scientific” practice in lieu of applied medical judgment.

Lastly, the existence of federally benchmarked norms of care will have the twin effects of enhancing physician liability for malpractice in cases where the federal standards of care are stricter than the relevant community standards, and potentially diminishing it where they are less strict. Though new governance tries to decentralize practice, these consequences will undermine this effort by nationalizing an important mode of medical regulation.

ACA will not only affect insurance markets, social-welfare structures, and religious entities: it will also change how we’ve always viewed the medical profession. While ACA promises higher-quality medicine, it is likely to deliver a diminished medical profession and higher quality of work for lawyers.