Healthcare, Medicare, and Medicaid Essay

Barsukiewicz, C. K., Raffel, M. W., & Raffel, N. K. (2010). The U.S. health system: Origins and functions. (6th ed.). Mason, OH: Cengage Learning.

An interesting perspective in regards to regulation is offered by; Academy for Health Services Research and Policy. The observations were presented for review on August 2001. The informative article is appropriately titled: The Challenge of Managed Care Regulation: Making Markets Work?

Managed care’s tremendous impact on medicine has focused on preventive health care, introduced outcomes measurement, evidence based medicine, utilization controls, and cost accountability to deliver high quality healthcare. At the same time, managed care has increased administrative overhead for providers, restricted vendor choices, and occasionally interfered with treatment protocols creating new problems in the healthcare setting. Virk (2007) suggests that managed care has become the backbone of the U.S. healthcare system and with the currently rising healthcare costs, critics have are again questioning the effectiveness of the managed care model. The decline of managed care in the United States appears at its highest point of acceptance as managed care plans competing in the healthcare market adopted characteristics of traditional insurance (Lagoe, Aspling, & Westert, 2005). As profitability became a tenet of managed care plans, premiums were increased passing a higher proportion of healthcare expenses to consumers. Managed care plans started catering more to consumer preferences in order to expand market share which decreased continuity of care and regulation of utilization controls, making managed care plans align more closely indemnity plans and preferred provider

To begin, the term “managed care” refers to health insurance plans designed to provide healthcare at the absolute lowest possible cost (Bodenheimer, 2001). These plans include PPO (Preffered Provider Organizations), HMO (Health Maintenance Organizations), and POS (Point of Service Plans). PPOs are a group of providers and hospitals that have agreed to accept lower costs for the care provided, as long as the patient remains within the network of providers; closely resembling a “Fee-for-service plan” (Bodenheimer, 2001). An HMO is slightly different in that it allows members an array of provider choices for a set monthly fee. However, the providers must be within the network. Additionally, HMOs focus on preventative care and typically offer routine

The topic of health care policy has been at the center stage of U.S. politics for almost a decade now, but since the 1990’s a form of health care coverage called managed care has been how millions of patients receive care. Managed care plans are contracts between health care providers and medical facilities with the aim of providing care to patients at reduced costs. These plans have taken much of the decision making regarding patient’s health from the doctors and placed it in the hands of the insurance companies who have progressively restricted the amount of treatments and medical services they cover.

Another form of competition that takes places exists between hospitals and hospital groups. Hospitals compete for physicians and other health care professionals, third-party payers and patients. Hospitals often compete for patients by providing more services, better amenities or discounted prices (Rivers & Glover, 2008, pp.634). This exists both locally and globally and this competition is only getting stronger given the advanced research and technology that is now available. In healthcare, the reality remains that the hospitals want to have the best technology and newest medical discoveries in order to recruit the best healthcare providers and personnel. The final form of competition takes place between organizations that provide health care financing and insurance and health care plans such as HMO’s and PPO’s. “Buyers of insurance plans must be knowledgeable about the varying prices and must be able to make an informed choice when deciding on what plans to buy (Rivers & Glover, 2008, pp.634-35).” Health plans can be confusing and loaded with an over-abundant amount of information. Furthermore, it can be difficult and daunting for a patient to compare the different plans available to them in that there are varying degrees of freedoms in different categories of the

The United States Healthcare system is not a single payer healthcare system (Ridic, 2012). Insurance can be provided through both private and public insurance marketplaces. Private insurance companies include plans such as Managed Care Organizations (MCO’s) that are mainly used by employers that want to insure full time employees. There are two types of MCO’s called Health Maintenance Organizations (HMO’s) and Preferred Provider Organizations (PPO’s) (Ridic, 2012). Public insurance companies include plans such as Medicare, Medicaid and CHIP ( (Health Insurance Marketplace). Despite all of the health insurance options, 45 million Americans are living without insurance (Goldman, 2005). Most of the uninsured population is either poor, unemployed

The U.S. health care system has evolved over the years; moreover, government involvement has increased immensely. The start of hospitals in the 1800’s gave way to the organization of healthcare which was the beginning of the healthcare industry (Williams, S.J., & Torrens, P.R., 2008). Federal and state government involvement in healthcare increased after World War II and by the 1960s people knew what Medicare, Medicaid, and individual insurance meant.

This growth is not attributed to individuals desiring protection from medical costs, rather these plans enabled physicians to establish revenue producing medical facilities (Kongstvedt, 2009). The original creation of HMO’s created negative thoughts and ideas from organized medicine due to the root cause being the generation of revenue for physicians. Therefore, the American Medical Association in collaboration with local and state governments initiated resistance against prepaid medical services (Kongstvedt,

HMOs were developed because it wanted to provide healthcare services for a fixed annual fee. It provides manage care, or health insurance, self-funded health care benefit plans, individuals and other entities acting as a liaison with healthcare providers such as hospitals and doctors on a prepaid basis. Many businesses partake in the HMO program researchers feel they private HMOs plans are not cost efficient over non-HMO plans. Even though the cost of out-of-pockets are reduced the plans doesn’t affect total expenditures and payments by

The challenges in our US healthcare system are not new, over the past three decades we have seen an increase in our population, significant fluctuations in our overall economy which increased unemployment, and a growth in health disparities. Unlike, other countries such as Canada, Australia and Europe the United States does not provide a unified healthcare model run by a primary agency for its legal residents. The insurance companies and pharmaceutical companies have been the primary stakeholders in the US system and have continued to profit. It is common knowledge that pharmaceutical companies sponsor diseases and promote them to prescribers and consumers (Moynihan, Heath, & Henry (2002). Since there

In 1997, many Health Maintenance Organizations (HMOs) suffered a decline in the value of their stocks. One newspaper account stated, “Just when HMOs seemed to offer an answer to the intractable problem of soaring health-care the bottom fell out. Some of the industry’s biggest names are racking up losses, grappling with unexpected rises in medical bills . . .and squirming under backlash from consumers doctors and politicians” [Anders and Winslow. 1997]. Why do you think that HMOs were unable to keep their costs low? What is there about the structure of HMOs that would lead to consumer discontent?

Managed care is credited by some as having been one of the most important factors impacting U.S. healthcare financing and organization since its prime in the 1990s (Shi & Singh, 2008). In fact, in 2011, the majority of all workers were enrolled some sort of managed care plan through their employer-sponsored insurance plans (Shi and Singh, 2013). Managed care organizations (MCOs) were embraced as a response to employers’ concerns over escalating costs associated with health insurance premiums (Shi & Singh, 2008). While managed care did succeed in controlling the use of health care services and slowing the escalation of health care costs, in the late 1990s it suffered backlash from the public and providers (Shi & Singh, 2013). This backlash prompted some MCOs to loosen their regulation over health services somewhat although they did not give up all control over utilization of services (Shi & Singh, 2013). The result was a compromise between MCOs, providers, and patients with fee-for-service reimbursement, capitation for some services, along with a larger choice of providers (Shi & Singh, 2013).

The number of employed doctors has dropped sharply, while salaries from hospitals increased. The four largest health insurance companies in the US denied coverage to more than half a million individuals because of there pre-existing conditions from 2007- 2009, according to a congressional investigation ( US health care Oct 12, 2010). Another roll was that federal government will step in to ensure that the Obama administration healthcare reforms are implemented in every state ( Kathleen Aug 18, 2010). The people of the researchers say that it is all about power. The less the American people know about the facts, the greater the hospitals and insurers gain power. The U.S health care system is the midst of a ferocious war (1). There is only one group that can prevent this damage.

The outrageous cost of medical care in the United States is one of the greatest disadvantages of our system. Costs are rising at a faster past than most other expenses. Managed care systems were created to reduce costs, and this meant that physicians no longer are autonomous practitioners in their own independent offices. Health maintenance organization (HMO) and preferred provider organization (PPO) are the most common examples. In HMO subscriber pay a set fee to be a patient in return for an agreement that the HMO will cover all the patient’s medical care at no additional cost. The HMO has an incentive to keep the patient as healthy as possible by providing preventative health care because they make the most profit when patients are healthy. As a result HMO’s try to cover younger, healthy subscribers who are less likely to become sick. The other main organization PPO, contracts with physicians who become “preferred providers”. Patients who enroll in the PPO receive better coverage if they are to see only doctors