Beyond managed costs

Managed care organizations (MCOs)face an uncertain future. While consolidat ion and price competition have expanded their market share, health care exp enditures are expected to rise in the near future, and the cost containment premise-and promise-of MCOs is being threatened by mixed blessing and nons upportive stakeholders. To shed light on MCOs' situation, we discuss four d rivers for change in health management in the U.S.: technology, regulation, consumerism, and demographics. Using those four drivers, we then assess th e various stakeholders in the industry through a competitive analysis and a stakeholder analysis. These analyses suggest that the munificence of the M CO business environment has significantly declined, especially among suppli er and buyer stakeholders. Hence, MCOs cannot continue to manage health car e costs alone as this will no longer generate sufficient support among buye r and supplier stakeholders. Instead, MCOs must tackle five critical health care issues by working closely with of her stakeholders and also by learni ng what they can from innovative health care initiatives both inside and ou tside the United States.