Managed Care

Shopping on line can be easy, simple and save you lots of money. It can also take a lot of your time, frustrate you, and result in unwanted purchases. Now the same can be said for regular high street shopping, but with the vast opportunity presented by the Internet it will pay you to spend a few minutes reading this and understanding how to better optimize your Managed Care shopping experience:

1. Compare - without doubt the biggest advantage that the Managed Care offers shoppers today is the ability to compare thousands of Managed Care at a time. This is a great thing, but not necessarily all the time! Too much can be daunting at times so take advantage of the great comparison sites and where possible let them do the hard work for you.

2. Research - if it has been said it will be on the internet. Ignorance is no longer a justifiable reason for buying the wrong thing. Take the time to research in detail everything that you could possible want to know about

3. Testimonials - don't know anybody that has bought a Managed Care? Wrong! If the Managed Care is good the internet will let you know. Use the Internet as a friend and get testimonials before you buy.

4. Questions - Got a question about Managed Care then search the Forums, FAQ's, Blogs etc. Don't be afraid to ask .....

5. Reputation - Never heard of the company selling Managed Care? Don't worry, no reason why you should know every company in the world, but you know someone that does! Use the internet to find out what people are saying about Managed Care and build up a picture of their reputation for sales, returns, customer service, delivery etc.

6. Returns - still worried that even after all of the above your Managed Care wont be what you want? Check out the returns policy. There is so much competition now that someone, somewhere is bound to offer the terms that you are comfortable with.

7. Feedback - happy with your Managed Care then let people know, after all you are depending on others people input in your buying decision, so why not give a little back.

8. Security - check for the yellow padlock on the Managed Care site before you buy, and the s after http:/ /i.e. https:// = a secure site

9. Contact - got a question about Managed Care, or want to leave a comment then check out the sites contact page. Reputable companies have them and respond.

10. Payment - ready to pay for your Managed Care, then use your credit card or PayPal! Be aware of companies that don't accept them, there may be genuine reasons but given the huge amount of choice you have when buying online there is no reason at all not to buy via credit card or PayPal.

Managed care is a concept in United States health care that started to influence health policy during the presidency of Ronald Reagan, ostensibly as a way to control Medicare (United States) payouts. According to the National Library of Medicine, the term "managed care" encompasses a variety of health insurance programs:

...intended to reduce unnecessary health care costs through a variety of mechanisms, including: economic incentives for physicians and patients to select less costly forms of care; programs for reviewing the medical necessity of specific services; increased beneficiary cost sharing; controls on inpatient admissions and lengths of stay; the establishment of cost-sharing incentives for outpatient surgery; selective contracting with health care providers; and the intensive management of high-cost health care cases. The programs may be provided in a variety of settings, such as Health Maintenance Organizations and Preferred provider organization. Managed Care. National Library of Medicine.

According to the trade association America’s Health Insurance Plans, managed care is nearly ubiquitous in the U.S.; 90 percent of insured Americans are now enrolled in plans with some form of managed care. The National Directory of Managed Care Organizations, Sixth Edition profiles more than 5,000 plans, including new consumer-driven health plans and health savings accounts.

Managed care has attracted controversy because it has largely failed in the overall goal of controlling medical costs. Meanwhile, proponents and critics are sharply divided on managed care's overall impact on the quality of U.S. health care delivery.

History Paul Starr suggests in his analysis of the American health care system (i.e., The Social Transformation of American Medicine) that Ronald Reagan was the first mainstream political leader to take deliberate steps to reform American health care from its longstanding not-for-profit business principles into a for-profit model that would be driven by the insurance industry. In 1973, Congress passed the Health Maintenance Organization Act of 1973 , which encouraged rapid growth of 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. The backlash against managed care, Nation's Business, July 1998, accessed 2007-10-05 Managed care plans and strategies proliferated and quickly became nearly ubiquitous in the U.S. However, this rapid growth led to a consumer backlash. Because many managed care health plans are provided by for-profit companies, their cost-control efforts created widespread perception that they were more interested in saving money than providing health care. In a 2004 poll by the Kaiser Family Foundation, majorities of those polled said they believed that managed care decreased the time doctors spend with patients, made it harder for people who are sick to see specialists, and had failed to produce significant health care savings. These public perceptions have been fairly consistent in polling since 1997. Kaiser Public Opinion Spotlight: The Public, Managed Care, and Consumer Protections, June 2004, accessed 2007-10-05.

The backlash included vocal critics, including disgruntled patients and consumer-advocacy groups, who argued that managed care plans were controlling costs by denying medically necessary services to patients, even in life-threatening situations, or by providing low-quality care. The volume of criticism led many states to pass laws mandating managed-care standards. Complying with these mandates increased costs. Meanwhile, insurers responded to public demand by beginning to offer other comprehensive plan options with more comprehensive care networks. In fact, between 1970 and 2005, the share of personal health expenditures paid directly out-of-pocket by U.S. consumers actually fell from about 40 percent to 15 percent. So although consumers faced rising health insurance premiums over the period, lower out-of-pocket costs likely encouraged consumers to use more health care, leading to expenditure growth. Health Care Costs: A Primer, Kaiser Family Foundation Health Care Marketplace Project, August 2007, accessed 2007-10-05

By the late 1990s, U.S. per capita health care spending began to increase again, peaking around 2002. |The Factors Fueling Rising Healthcare Costs 2006, report prepared by Price Waterhouse Coopers for America’s Health Insurance Plans, January 2006, accessed 007-10-05 Despite managed care's efforts to control costs, U.S. health care spending continues to outstrip the overall economy, rising about 2.4 percentage points faster than annual GDP since 1970. Trends in Health Care Costs and Spending, Kaiser Family Foundation Health Care Marketplace Project, September 2007, accessed 2007-10-05

Forms of managed care There are several forms of managed care. Plans range from more restrictive to less restrictive, and include:

Health Maintenance Organization (HMO) Proposed in the 1960s by Dr. Paul Elwood in the "Health Maintenance Strategy", the HMO concept was promoted by the Richard M. Nixon as a fix to rising health care costs and set in law as PL 93-222. As defined in the act, a federally qualified HMO would in exchange for a subscriber fee (premium) allow members access to a panel of employed medical doctor or a network of doctors and facilities including hospitals. In return the HMO received mandated market access and could receive federal development funds.

In practice, an HMO is an insurance plan under which an insurance company controls all aspects of the health care of the insured. In the design of the plan, each member is assigned a "gatekeeper", a primary care physician (PCP) who is responsible for the overall care of members assigned to him/her. Specialty services require a specific referral from the PCP to the specialist. Non-emergency hospital admissions also required specific pre-authorization by the PCP. Typically, services are not covered if performed by a provider not an employee of or specifically approved by the HMO, unless it is an emergency situation as defined by the HMO. Financial sanctions for use of emergency facilities in non-emergent situations were once an issue; however, prudent layperson language now applies to all emergency-service utilization and penalties are rare.

Since the 1980s, under the ERISA Act passed in Congress in 1974 and its Preemption (law) effect on state common law tort lawsuits that "relate to" Employee Benefit Plans, HMOs administering benefits through private employer health plans have been protected by Federal law from medical malpractice on the grounds that the decisions regarding patient care are administrative rather than medical in nature. See "Cigna v. Calad ", 2004.

Preferred Provider Organization (PPO) Rather than contract with the various insurers and third party administrators, providers may contract with preferred provider organizations. They generally agree to a discount from a relative value-based fee schedule or simply a discount from whatever they bill (which is perhaps subject to reasonable, usual, and customary limitation (generally a percentile of national or regional charge data)). The PPO, in turn, promises convenience, less administrative expenses, and/or prompt payment.

In terms of using such a plan, unlike an HMO plan, which has a copayment cost share feature (a nominal payment generally paid at the time of service), a PPO generally does not have a copay and instead offers a deductible and a coinsurance feature. The deductible represents the first dollar of coverage and is paid by the patient. After the deductible is met, the coinsurance portion applies. If the PPO plan is a 80% coinsurance plan with a $1,000 coinsurance out of pocket, then the patient will pay 20% of the allowed provider fee up to $1,000. After this amount has been paid by the patient, the insurer will pay 100% of subsequent costs.

Because the patient is picking up a substantial portion of the "first dollars" of coverage, PPO are the least expensive types of coverage.

Point Of Service (POS) A POS plan utilizes some of the features of each of the above plans. Members of a POS plan do not make a choice about which system to use until the point at which the service is being used.

In terms of using such a plan, a POS plan has levels of progressively higher patient financial participation as the patient moves away from the more managed features of the plan. For example, if the patient stays in a network of providers and seeks a referral to use a specialist, they may have a copayment only. However, if they use a network provider, but do not seek a referral, they will pay more, and so on.

Managed care in indemnity insurance plans Many "traditional" or "Insurance#Indemnification" health insurance plans now incorporate some managed care features such as precertification for non-emergency hospital admissions and utilization reviews.

Managed care's impacts The overall impact of managed care remains widely debated. Proponents argue that it has increased efficiency, improved overall standards, and led to a better understanding of the relationship between costs and quality. They argue that there is no consistent, direct correlation between the cost of care and its quality, pointing to a 2002 Juran Institute study which estimated that the "cost of poor quality" caused by overuse, misuse, and waste amounts to 30 percent of all direct health care spending. The emerging practice of evidence-based medicine is being used to determined when lower-cost medicine may in fact be more effective.

Critics of managed care argue that "for-profit" managed care has been an unsuccessful health policy as it has contributed to higher health care costs (25-33% higher overhead at some of the largest HMOs), increased the number of uninsured citizens, driven away health care providers, and applied downward pressure on quality (worse scores on 14 of 14 quality indicators reported to the National Committee for Quality Assurance).(Himmelstein, Woolhandler, Hellander, Wolfe, 1999; HMO honor roll, 1997; Kuttner, 1999)

Notes and references

Further reading

Managed Healthcare Executive - a magazine for senior-level decision makers.
Medical Economics