What is a managed care organization?
Managed care plans are some kind of a health insurance provided by Managed Health Care Company, which is a group of medical practitioners, health institutions, and other stakeholders in the health industry who work as a team to provide healthcare needs at a reduced cost (Bundorf, Schulman, Stafford, Gaskin, Jollis, & Escarce, 2015). The plan works because the doctors in each network have contracts with medical facilities and health care providers to provide healthcare services to its members at a reduced cost. These providers make up what is known as the plan’s network and this is the group of people and institutions that ensure that its members get access to high-quality healthcare services at relatively reduced prices. Managed care organizations fall in three main categories. The first category is Health Maintenance Organizations. In this category, patients are required to have a family doctor who must give them referrals to other healthcare professionals who must be working under the same network (Burns, 2015). The second category is known as the Preferred Provider Organizations, which is the most commonly managed care organizations in the United States, and it allows patients to seek care outside their network but at a slightly higher cost. The last category is the Point of Service plan that calls on patients to have a permanent primary care doctor to oversee all their medical needs and provide referrals. This plan performs out-of-network referrals but at higher costs.
How Managed Care Organizations Attempt To Control Costs
Managed care organizations attempt to keep healthcare costs down as they act as nonprofit ventures that can help control costs, and at the same time offer broad coverage of high-quality medical services (Burns, 2015). These organizations are made up of a group of specialists, physicians, and often hospitals working together and paid a monthly flat fee as opposed to fees that are quantified by the number of patients a doctor sees. This arrangement is what has made it possible for this plan to reduce or control healthcare costs.
Advantages Managed Care Organization
The biggest advantage of this system is that it lowers the cost of medical costs incurred by patients without compromising the quality of services rendered. People within this system can be referred from one doctor to another or from one hospital to another and be able to receive an array of medical services at a reduced cost (Burns, 2015). Another big advantage of this plan is that prescription management works much easier and efficiently. Many networks work with major pharmaceutical companies and agencies to make certain that all the needed prescriptions are accessible and are offered at an affordable price to all those that need them.
Disadvantages of Managed Care Organization
The major disadvantage of the Managed Care Organization is that it limits healthcare access to all the people without any kind of medical insurance cover. The poor people who are living within the system with a managed care plan have very limited options in accessing high-quality healthcare services at very affordable prices (Burns, 2015). Another demerit of this plan is that some networks can have very long wait times. Many networks have many members and this increases the wait times making it almost impossible for patients to speak to doctors and be examined on a regular basis (Silow-Carroll, Edwards, & Rodin, 2013). It has been reported that some networks schedule children vaccination for up to five months because of the waiting time. This is a major drawback of this system.
Even though this system has disadvantages, its major advantages far more outweigh the negatives. For this reason, members of the public should be urged to join a network.
Burns, ME. (2015). Medicaid managed care and health care access for adult beneficiaries with disabilities. Health Serv Res. 44(5, pt 1):1521-1541.
Bundorf, MK, Schulman, KA, Stafford, JA, Gaskin, D, Jollis, JG, Escarce, JJ. (2015). Impact of managed care on the treatment, costs, and outcomes of fee-for-service Medicare patients with acute myocardial infarction. Health Serv Res. 2015;39(1):131-152.
Darr, K. (2011). Ethics in Health Services Management. Fifth Edition. Baltimore, MD: Health Professions Press, Inc Silow-Carroll, S, Edwards, J, Rodin, D. (2013). State Levers for Improving Managed Care for Vulnerable Populations: Strategies With Medicaid MCOs and ACOs. Lansing, MI: Health Management Associates.
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