Managed Care Essay

Managed care dominates health care in the United States. It is any health care delivery system that combines the functions of health insurance and the actual delivery of care, where costs and utilization of services are controlled by methods such as gatekeeping, case management, and utilization review. Different types of managed care plans came into development by three major factors. These factors include choice of providers, different ways of arranging the delivery of services, and payment and risk sharing. Types of managed care organizations include Health Maintenance Organizations (HMOs) which consist of five common models that differ according to how the HMO is related to the participating physicians, Preferred Provider Organizations

The Iron triangle for healthcare consists of cost, quality, and access; these three characteristics when balanced create great healthcare. Managed Care Organizations combine the three to offer consumers with care that is appropriate for their individual needs. Our book describes managed care organizations as “the cost management of healthcare services by controlling who the consumer sees and how much the service cost” (Basics of the U.S Healthcare System, Niles). Taking a look at the history prior to the Health Maintenance Organization Act of 1973 (HMO ACT of 1973) the implementation has been significant in balancing cost, and quality control. Before this Act was signed in to law by President Nixon healthcare costs were determined by fee for service. A fee for service or indemnity plan is a plan that allows the provider to determine the cost of service, this fee for service plan caused for healthcare costs to increase rapidly. An example of this would be going to the doctor with neck pain, being told to stretch then receiving a bill for 25,000 dollars. As could be understood the cost of healthcare had became a problem.

What are the three main payment mechanisms managed care uses? In each mechanism who bears the risk.

As a managed care organization Kaiser Permanente has served as a model for informational healthcare systems and the recent demand for affordable care has prompted the organization to lower cost in services without hindering the quality of care. Kaiser Permanente has integrated a system in which the organization assumes all financial risk and a bundled enrollment fee for service strategy. What makes Kaiser Permanente unique from other HMOs is their accountability for quality, utilization management, financial risk, and business strategies (Kaiser Permanente, 2009).

In this country there are numerous concerns about health care economics. Several factors contribute to the increase of health care costs. One area of concern is the impact of managed care on health care finances. Managed care has been around since the early 1970s. The definition of managed care is a set of contractual and management methods implemented to manage the financing and delivery of health care services. Initial implementation of managed care was for health care cost saving (Getzen & Moore, 2007, p. 203, para. 1). Though Managed care initially addressed several health care finance issues, there are still problems with the current

States have chosen to two forms of Medicaid managed care to better deliver healthcare services besides the traditional fee-for-service Medicaid programs; primary case management and traditional health maintenance organizations. “In primary care case management, the state Medicaid agency contracts with a primary gatekeeper entity (e.g., physician, clinic) that coordinates primary and specialty care for Medicaid beneficiaries. For healthcare maintenance type programs, a State Medicaid agency contracts with an existing healthcare maintenance organization, prepaid health plan, or other institutional health care provider who, in addition to proving primary care services, assumes insurance risk of providing covered services. Typically primary case management are paid on a fee-for-service basis plus a monthly case management fee per enrollee, while health maintenance organization plans are paid a capitation rate and are at full financial risk.” (1)

Managed care has been adopted into the government funded care organizations. Medicare managed care plans provide all coverage themselves, including basic Medicare coverage. Managed care plans cover above and beyond the basic benefits of Medicare, the size of premiums and copayments, and the decisions about paying for treatment are controlled by the managed care plan. The basic premise of managed care is that the member/patient agrees to receive care from only a specific doctors and hospitals, in exchange for reduced healthcare costs. Medicare, like other insurance companies offer plans that give Medicare beneficiaries more choices in coverage, like HMO or PPO. Managed care has been used since the mid 1990’s in order to provide healthcare to beneficiaries with serious or life long illnesses. Today, managed care has become a way for states to provide quality care to both Medicaid and Medicare patients.

rising health care costs. Managed care can be defined a system of delivering health services in

Managed Care is a system of health care in which patients agree to visit only certain doctor and hospitals, and in which the cost of treatment is monitored by a managing company. David, a clinical supervisor of one pad was responsible for the clinical supervision of eight clinical case managers. On typically day, he receives around 40 phone messages about clients that are in need of his services. His job is to field calls from mental health providers seeking authorization to provide treatment for clients. There are those who believe that managed care is simply another example of corporate America discovering a means to increase profits for shareholders of insurance companies, at the expense of individuals seeking mental health treatment. (pg.

Managed care in simple can be defined as an organized approach to delivering healthcare services in an efficient way to enrolled members by negotiation of prices and payments with the providers. Managed care is one of the dominant influence that as transformed the healthcare delivery system in the United States since the 1990s. Managed care has two different contexts to it.

Managed care is a term that has been used widely in and around the United States. A managed care organization can be defined as, “an organization that combines the functions of health insurance, delivery of care, as well as administration” (Legal Dictionary). With all the healthcare reform projects already in place, legislators felt something needed to be done with the way our current health care system is delivered. A managed care organization is put in place to basically provide better health benefits for members and simultaneously reducing the enormous costs. There are many different programs and techniques that all can be used to accomplish these goals. Managed care is a step in the right direction if we want to see improvements with our

Managed care is a system of healthcare delivery that seeks to achieve efficiency by interpreting the basic functions of healthcare delivery. It employs mechanisms to control (manage) utilization of medical services and determines the price at which the services are purchased and how much the providers get paid.

In other to manage or curtail the ever rising healthcare cost in America, Managed Care was formed. The National Library of Medicine, defines managed care as programs or organizations “intended to reduce unnecessary health care costs

Managed care was established in order to manage health care cost, utilization, and quality (Kongstvedt, 2015). In managed care, health insurance is provided through HMO, PPO, and other types of managed care. It has the potential to reduced health care spending and improved the quality of care. However, despite of its success in improving the quality of care through preventive health care services, chronic disease management program, and so forth, many physicians are reluctant to be part of the managed care environment. Some of the reasons are the impact of managed care to physician’s income and autonomy. Under managed care, insurers have decreased the fees paid to physicians. There are different ways how managed care organizations control costs. One of this is through selective contracting with health care providers and hospitals to lower costs. In selective contracting, health care providers agreed to accept lower prices in exchanged for guaranteed volume of patients under managed care plan (Culyer, 2014). This paper will discuss more issues and trends in Managed Care Organizations such as the rise of Medicaid Managed Care spending, the new Medicaid Managed care Rule, and the collaboration of Managed Care Organizations and Accountable Care Organizations to reduce health care spending and improve efficiency of care.

In 1973, Congress passed the Health Maintenance Organization Act, which encouraged rapid growth of Health Maintenance Organizations (HMOs), the first form of managed care. Managed care plans are widely credited with subduing medical cost inflation in the late 1980s by reducing unnecessary hospitalizations, forcing providers to discount their rates, and causing the health-care industry to become more efficient and competitive.