Managed Care Organizations: A Case Study

The Affordable Care Act (ACA) became law on March 23, 2010. The act has been the most significant change to the U.S. health care system since the creation of Medicare and Medicaid in 1965 (French et al., 2016). ACA created new requirements for individuals, employers, healthcare providers, and insurance organizations to follow in hopes to better serve individuals in America with access to health insurance, health care cost, and the delivery of care (French et al., 2016). Since the launch of the ACA, there has been an effect Medicare spending.

Finally, the ACA has encouraged and expanded the CMS department to test whether the reform and delivery models are working (Cassidy, 2010). This law gives CMS the right to change payment delivery and implement quality initiatives without having to go through the proper chains to seek approval. This initiative is often frown upon because at a moment’s notice, CMS can make changes. The ACA has helped Medicare to expand is sustainability for quite a few years, but initiatives have been passed onto the population monetary wise which has caused the people to become frustrated with the government.

The ACA included reductions in Medicare payments to plans and providers and introduced delivery system reforms that aims to improve efficiency and quality of patient care and reduce costs including accountable care organizations (ACOs), medical homes, bundled payments, and value-based purchasing initiatives”(Cubanski & Neuman, 2016, p. 2).

Although the ACA will make revenue cycles more complex for hospitals, possibly lengthen the revenue cycle, and have complicated payment responsibilities I do think it will give providers the opportunity to improve and excel by adapting the new revenue cycle management (RCM) and acquiring new capabilities that can give them the opportunities to thrive.

With the continued transformation of the healthcare system, an increased emphasis on consumerism and quality-based reimbursement will be observed. This could lead to challenges for all managed care stakeholders. One example of an industry change that might occur is that patients’ out-of-pocket costs could increase. The cost of healthcare continues to rise faster than inflation, generating increased incentives for insurance companies to offer plans with high deductibles and small networks. In the article “The Top Changes MCOs Should Expect in 2016” Joel Brill (2015) states that:

At one point, managed care was the viewed as a resourceful tool in efforts to help assist employee, physicians and hospitals with quality health care, while controlling the cost of medical care in the United States. Over the past 30 years, managed care has been in the limelight of health insurance, as a dictator of how it will pay for medical bills. There have been many factors playing a role with managed care over the years. For example, due to the slim selection of options that are available with physicians in rural areas, and limited physicians to choose from, does this compromise the quality of care of each member or does this cut off services for members

On March 23rd, and March 30th, 2010, President Barack Obama signed the paperwork for the Patient Protection and Affordable Care Act (ACA). This act is a law that was put into place to help make sure all Americans could have access to affordable, quality health insurance coverage. The ACA has now been available for five years with more than sixteen million people insured through it. “Over a period of several years of implementation that began in 2010 and will continue through 2019, the spectrum of the ACA provisions will change how health care is delivered and financed in ways that vastly exceed the impacts of Medicare and Medicaid.” (Sultz & Young, 2014, p.xxiv) The ACA is a law and in this paper, I will be discussing the major components of it which are Titles I-X and how it has improved the health care delivery system in the United States. This act is extremely important to Americans because it helps to make insurance affordable and keeps premiums down.

Besides, the financial incentives for hospitals and physicians that belong to ACOs, Jaffery & Golden 2013, asked and then answered the question “why would providers join this program? One reason is to prepare for the future”. Fee-for-service reimbursement, which has been how hospitals get paid for their services rely solely on the volume of patient seen without taking into consideration the quality of care provided. Payers today, such as government, commercial insurers, employers, and individual consumers are now requesting on value -based-payment, which consist of delivering the highest level of care at a lower cost. The volume based system even though the traditional way of how payments are made is not a viable long-term option (Jaffery and Golden, 2013, p.98).

Under the Affordable Care Act, traditional fee for service reimbursement will be methodically phased out over time and be replaced by quality of care reimbursement; therefore, the focus of primary care will be shifted from the actual treatment of patients

Managed care is the most dominant healthcare delivery system in the United States and available to most Americans. Employers and government are the primary financiers of managed care. The managed care sector includes approximately

Generally, the managed care system is a network provider which integrates the doctors and healthcare facilities under one system. It is thus responsible for creating the financial incentives and reducing the cost of health for client by negotiating with and by networking with health providers across the US (Kreindler, 2012). Today, the managed care organizations are found everywhere in the US but have become somewhat controversial because of their goals of controlling the medical costs which has somehow produced unethical practices. They have been accused of becoming consumer driven and therefore, profit making machine rather than delivery services to the clients. They have also been accused of charging very high fees that are unaffordable for most Americans (Goodrick & Reay, 2016).

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.

care spans a wide variety of organizations, but the key idea is that MCOs are

The article describes about the two main perspectives related to the contracting for Managed Care Services including from the general issues to specific details in a deep of contract and many practical issues as well as the specifics of each provider type. In modern medical industry, Managed Care Service contracting process is becoming more important because complex business relationship in medical industry goes through the renewed Government regulations and accreditation requirements, and it always require high quality of care accompanying with additional risk by the service providers. The author points out the negotiation is very essential for both sides, and in order to endorse on very good written agreement, both sides obligate to be aware their rights and responsibilities as well as all

Service excellence is the ability of the service provider to meet or exceed the expectations of the customer they are providing the service to. Service excellence is important to all different fields where services are provided. In the health care field in the past few years, service excellence has become increasingly important.