GM tries steering health costs: Is what's good for GM good for doctors?

Physicians are watching intently as the world's largest automaker finds ways to affect the cost and quality of care. Lately, they aren't sure they like what they're seeing.

By Amy Snow Landa, AMNews correspondent. July 18, 2005.

In 1953, as he was undergoing confirmation as secretary of Defense, GM president "Engine" Charley Wilson is said to have declared: "What's good for General Motors is good for the country."

What he actually said was, "We at General Motors have always felt that what was good for the country was good for General Motors, and vice versa." Still, physicians these days can't help but think how the misquote shows how corporations impose their will in part because they assume it's what's best for everybody.

GM, experiencing one of its worst financial crises, is working on imposing its will in health care. If any employer can, it's GM. With about 150,000 employees in 32 states, as well as hundreds of thousands of retirees, and their families, the company provides health coverage for more Americans -- about 1.1 million -- than any other private employer. It also pays a hefty price -- about $5.2 billion in 2004 and a projected $5.6 billion this year.

GM was one of the companies behind the Leapfrog Group, a business consortium dedicated to increasing health quality and patient safety while keeping costs under control. GM, in cooperation with the United Auto Workers, created the LifeSteps program to improve the health and wellness of its workers and retirees.

But lately, GM has started to impose its will more specifically on costs, including physician reimbursement. GM explicitly blamed much of its $1.1 billion first-quarter loss on health care costs. It's seeking major concessions from the United Auto Workers on employee and retiree health benefits, even before its union contract expires in 2007.