It is a pleasure to introduce this special volume of the Industry and Health Care Series. It is special for the best of reasons: it is primarily written by industry representatives. Using the Washing ton Business Group on Health 1978 Annual Meeting as its starting point, this volume captures the feelings, concerns, and experience of many who are leading industry's increasingly significant presence in health policy and economics. While many of the largest companies achieve more sophisticated levels of involvement, the fact remains that most companies of all sizes and especially the smaller businesses either will not or cannot devote the time or resources to become active participants. We hope this volume will help demonstrate the value of even one person's commit ment. Although our organizational focus is Washington, the WBGH rec ognizes that, in the long run, the quality and cost of the health care most Americans receive will be-and should be-determined at the local level. To let this happen without industry involvement would represent an abdication of both responsibility and opportunity. Fortunately, we see a growth of industry involvement, growth not just in terms of numbers but also in terms of the scope of activities. * Recognizing that the key to changing provider behavior is to change the economic incentives, emanating from the major payers, em- vi Preface ployers are subjecting their employee benefit plans to the most com plete scrutiny in many years.

This fifth issue in the Industry and Health Care series takes a quick turn through unpredictable and only partially charted waters. The series as a whole has set out to explore the role of industry as a potential agent of change in the health care system, and to map the courses that may lead toward control of costs. One that looks possible is the effort now being made to infuse some competition into the health care industry through organized systems of care, known as HMOs. Health maintenance organizations, especially the fee-for-service variety known as IPAs (individual practice associations), have been a particular inter est of the Center for Industry and Health Care, where a national data base 'on IP A performance is being established with the aid of the Robert Wood Johnson Foundation. The Center's identity with HMOs, combined with its focus on industry and health care, has afforded us unusual access to nascent corporate thinking on the pros and cons of HMO sponsorship. We are grateful for these opportunities, and for the insights industry people have shared with us. This series draws heavily on that experience."

Close followers of the evolution of the Series on Industry and Health Care will recognize in this fourth volume some continuity and some change. The essential concept behind the series remains: here, as before, we are looking to private industry as a potential agent of change in the American health care delivery system. We have made some structural accommodations, however, to comments received from readers in industry and in health services. The original concept of a topical monograph supplemented by a separate hardbound volume of background papers has yielded to the present formula in which each volume is complete in itself. The series continues to draw much of its material from interdisciplinary working conferences convened by the Bos ton University Center for Industry and Health Care. Rather than publish confer ence proceedings, we have again undertaken to analyze the discussions and to integrate with them some timely background materials. Readers have found this format a major improvement over traditional conference reports and sum maries."