Managed Care Without An HMO?

When Kevin Dell buys health insurance for his family, he doesn't get it from an insurance company; he gets it directly from his employer, Motorola, reports CBS News Correspondent Wyatt Andrews. The network of doctors he sees has been set up by Motorola and the claims he files are to Motorola.

Not once has the Dell family missed their former HMO.

"The HMO's doctors that we went to, we almost felt like it was the fast food of medical care, and this way we feel like we're with doctors that we are happy with and we're saving money," says Betsy Dell, Kevin's wife.

Way out there on the cutting edge, Motorola is one of several U.S. corporations who have decided to bypass insurance companies and provide employee health care themselves.

"We will continue to do this as long as we can't do it faster, better, cheaper, and at better quality," says Rick Dorozil, Motorola's vice president for benefits.

Dorozil says the plan offers better care than an HMO, at a better price.

"No doubt in my mind, the way we administer our program is much more effective than what we can get on the outside," Dorozil says.

Seventy percent of Motorola's 80,000 employees have signed up. Families pay $12.50 a week, plus 10 percent of most bills. In return, they can see any network doctor, including specialists, without authorization from an HMO gatekeeper.

Motorola set up this plan three years ago when employees said in a survey they were tired of the HMO's gate-keeping. In particular, employees said they wanted access to routine tests and access to specialists without needing permission.

Betsy Dell felt strongly about that. When she was pregnant with her oldest child, her HMO primary care doctor refused to let her see an obstetrician, despite a previous miscarriage.

"In my mind, I was concerned that it might happen again, and he was [saying], 'Oh, you don't have to worry about that.'"

Dorazil says that there is no gatekeeper under the Motorola plan. There is also no pre-authorization to see a specialist.

Despite the unusual concessions, the company saves money. Unlike other businesses, they do not need an army of 1-800 operators that need to be paid and there's no insurance company demanding a profit.

In addition, the company thinks that patients who can see specialists immediately return to work faster.

"You shorten disability times, you shorten the discomfort time, you raise the patients' happiness levels," explains Fred Lochar, an orthopedist in the Motorola network.

However, the system is not a return to free-spending medicine. Doctors have been warned that Motorola won't tolerate unnecessary treatments.

While Lochar says he is aware of being watched by Motorola -- as he would wit any managed care system -- he still has more control.

"...It's managed more by me, the physician, rather than some HMO," he says.

It's unclear if this plan could work in smaller companies and even Motorola calls it a work-in-progress. But businesses and the HMO industry are watching Motorola's attempt at providing managed care without the hassles.

Reported By Wyatt Andrews