Health Care Infrastructure Term Paper

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Managed Care Health Reimbursement Systems in the United States

With health care costs skyrocketing consumers and health insurance companies alike are seeking solutions to the growing crisis in health care within the United States. This crisis revolves primarily around the lack of coverage that exists for millions of Americans. Employers are more and more dropping out of traditional health insurance programs and seeking new ways to provide employees with health care services. In response to the climbing costs of health care many reimbursement and health care cost containment programs are being developed.

There are many health care reimbursement programs available to patients that provide some form of medical care cost containment and coverage. Among the most popular of these or at least the fastest growing are managed care reimbursement programs. Managed care reimbursement programs are becoming more the norm rather than the exception to the rule.

Managed care programs have changed the face of health care in the United States. Some have argued for the better whereas others for the worse. The managed care reimbursement system and its impacts on the medical community and patients is described below.

Managed Care Organizations: An Analysis

With the rising cost of medical care many health insurance agencies in the United States are tightening their belts. More and more health care reimbursement is an economic and social concern, particularly when more than 39 million Americans lack any form of health insurance (Kabalka & Rocha, 1999; Hanson, 1994). Managed health care reimbursement plans have emerged as a way to help manage the current crisis that exists with regard to rising health care costs.

The managed care approach or managed care organizations (MCOs) work by managing costs by imposing restrictions on health care services. Generally MCOs require that participants select a primary care physician group to facilitate and manage all medical care. They establish very stringent guidelines for treating patients, prescribing medications and utilizing services (Dranove, 2000). The goal of most managed care reimbursement programs is reasonable and conservative service to patients.

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MCO's content that it is possible to minimize costs but still provide optimal health care services to consumers.

In times of old patients relied on physicians who worked autonomously to manage their care; they receive complex care from hospitals independent of group plans and insurers generally did not intervene in determining reimbursement policies (Dranove, 2000). This has changed however as health care costs have skyrocketed.

Generally independent benefit consultants help employers make choices about what managed care organization to decide on (Dranove, 2000). Employers generally choose a single plan or possibly two plans for employees to choose from. Most people that are not working for a corporate organization find themselves at a loss when it comes to health insurance.

Health care providers are generally reimbursed for services differently than traditional insurance plans under a managed care program. Generally managed care may be considered a health care reimbursement system where third party payers control the costs associated with health care (Camperell & Mitchell, 1995). These third party payers advise physicians regarding health care costs. Physicians who participate in managed care programs generally share part of the financial risks for patients use of services, thus they are much more conservative in their treatment protocols (Camperell & Mitchell, 1995).

Primary care physicians that operate under managed care contracts generally work as gatekeepers; this means they generally monitor who gets access to what hospital services and act as referral agents for sending patients to specialty services rather than patients acting as their own gatekeepers and freely selecting which services to partake of or not (Camperell & Mitchell, 1995). If a patient does not access care through their primary care physician it is possible that they will be denied coverage for services rendered.

Managed care organizations require that physicians help manage the business of health care (Camperell & Mitchell, 1995). They draw up contracts with physicians that set certain terms for the number of expenses to be incurred and generally when expenses exceed this the physician or group is responsible.....

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