When cost containment interferes with clinical decisions

Incentives to sparingly order diagnostic tests, make referrals to specialists, or discharge patients early, expand exposure to medical professional liability. Discharging a patient prematurely from a hospital, or denying a patient referral to a specialist because of HMO or government budgetary considerations is no defense to substandard treatment. Such accusations are difficult to defend. Not only is there the issue of negligence in denying proper care but also the conflicting interest of deriving financial profit from the denial of adequate care. This article documents these liability risks for physicians and those who seek to manage their treatment decisions.