Managed Care Research Paper

Improved Essays
People buy health insurance because they prefer to pay a small premium to a third party payer than to risk getting ill and having a large medical bill. Managed care plans operate and monitor the use of health services by reducing health care costs. There are four types of managed care plans include health maintenance organizations (HMOs), preferred provider organizations (PPOs), point of service (POS) plans, and managed indemnity plans.
In every type of HMO, every employer pays the same monthly premium for HMO service. Each employee is assigned to a primary care doctor for when they need medical attention. If the employee has a problem that is out of the physician’s area of expertise then that person is referred to another HMO physician. In the event the employee needs immediate medical attention or medicine, they are referred to hospitals and pharmacist within their HMO. There are various types of HMOs but first lets address group-model HMO. In group model HMOs the health benefit intermediary contracts with a multispecialty group practice to provide medical care to the HMO’s members. The doctors in the group practice are employed by the group practice and not
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The PPO is a network of physicians, hospitals, dentists, labs and home health care that contract with the company offering the health care plan. All the providers agree to a rate under the PPO scheme. The PPO gives patients more flexibility in choosing a doctor and health care providers. Other benefits under the PPO plan are: patients do not need referrals to see specialist, members of PPO plans get faster treatment than those under HMO plans, and they can choose providers outside of the PPO network. PPO copayments are 10% of charges for care in network and 30-40 % of care charges out of network. Patients are reimbursed for the rest of the network

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