But in the end, House does confront Cuddy, insisting that she finally face Arlene and take control of her medical situation. House is right—while being protective of both her and his relationship with her. If something goes wrong, he knows that it will ultimately end in disaster for him: he will lose Cuddy. It’s completely selfish, what he’s protecting here—completely House—protecting himself.
His disclosure that if Arlene dies, that at some point, Cuddy will blame him as the man responsible for her mother’s death, is something he can’t live with. And if Cuddy can’t confront her mother and insist that House be put back on the case, Arlene will die; House will be (at least subconsciously) blamed, and so will end their relationship. It’s one of the best scenes between them in the entire series and beautifully played by both actors.
The other great conflict arising from Arlene’s case is between House and medical student Martha Masters (Amber Tamblyn). Although House attempts to treat Arlene without Masters’ involvement and interference, she realizes eventually what’s going on. Willing to put her job—and her career—on the line for her ethical stance, she rats out House first to Cuddy and then to Arlene knowing that House has threatened to destroy her career if she does so.
Her courage to confront House in the face of his threat (which scares the hell out of her) is rewarded in the end when House realizes her value on the team and to him. At this point, House is all about protecting his relationship with Cuddy. He understands, as he articulates to Masters, that the board won’t long put up with her protecting his practice—and him, now that they're a couple.
There will be a tipping point, and as long as Cuddy and he are involved, that will always be a risk. Masters serves as another brake on House—one that is unaffected by their unequal power relationship. He understands the value in her and her importance in House's long-term goal of maintaining his relationship with Cuddy.
In the middle of the episode, when Cuddy realizes that House is right about treating family members, House is momentarily struck by a notion. And I think it is here that House realizes that Cuddy cannot “treat” him: she cannot effectively put the brakes on his tendency to recklessness.
I have a theory about the dynamic between House and Masters in “Family Practice.” I think House knows exactly how Masters will react when he threatens to destroy her career should she choose to rat him out to Cuddy’s mother. When I watched the scene where he threatens her, I wondered how House could seem so out of character to me; his words were stunning enough to Masters that they made her sick with fear. I think It’s entirely possible that the threat intended to test the bounds of her ethical chops. Will she rat him out even knowing the consequences? And in the end, she passes his test—but not without being subjected to House’s incredibly brutal challenge. Am I certain of House’s intentions? No, of course not.