Concept Of Managed Care And Its Current State

Managed Care Student’s Name Institutional Affiliation Managed Care The healthcare sector in the United States is changing constantly. Generally, managed care and health insurance have various origins in the early years. The health sector economy has a great influence on the sustained evolution of managed health care. Other forces include changes in health care delivery, changes in consumer consumption, politics, and, market needs. U.S companies are facing stiff competition from abroad due to rising health benefits cost. The paper discusses the concept of managed care, its current state, and the impact on U.S health care systems. Managed care is the practice of funding agencies using purchasing power vigorously to integrate finances and enhances suitable delivery of health care services (Cutler, Davis, & Stremikis, 2010). The U.S government has a long history of trying to find a way to control medical cost. Being a 20th-century development, managed care has been considered to be an insurance system rather than a prepaid health care. Before the Second World War, 10 percent of employed persons had health benefits compared to 70 percent in 1955. During the Second World War era, models such as the Health Maintenance Organization provided and paid for healthcare besides the patients simply paying for the services. The health maintenance organization (HMO) was the first form. This organization combined both functions, financing and delivery systems to provide direct services through its amenities and personnel. The second was the early Blue Cross and Blue Shield plans which initially paid for the services contracted by the public doctor or hospitals. Additionally, they financed services rendered to patients not covered by the organization models. The prepaid groups’ practices faced opposition mainly from the local medical societies. Lastly, the other categories of managed care organization include Point of Service plans (POS) and preferred provider organizations (PPOs). PPS was introduced in the 1980s in an effort to curtail health cost in the hospital. The third-party payment systems cut down on the health care cost paid out of individual pockets The levels of copayments and coinsurances are increasing steadily and will at some point become more complex. In the early years, pharmacy benefits were simple copays, but currently, there are ranging levels of copayment tiering and significant deductible. Consumer-directed health plan (CDHP) is among the recent development on the rise. CPHPs are associated with pretax funds to help recompense for the costs. Moreover, health plans have assisted consumers to access detailed and quality data as well as affordable costs. Through the health plans, consumers get to choose physicians and hospitals as well as have a better understanding of health care options. Additionally, the development of the Medicare Modernization Act has a significant impact on managing care in the United States today. States continue to turn to managed ...