Table of Contents
Cover Page…………………………………………………………………………………………….1

Table of Contents…………………………………………………………………………………..2

Introduction to Managed Care and the Pros………………………………………….3-4
• Types of managed care
• How managed care is governed

Cons of Managed Care…………………………………………………………………………..4-5
• Why is there a need for managed care

Conclusion……………………………………………………………………………………………..5

References……………………………………………………………………………………………..6

Health insurance plans that contract with health care providers and medical facilities to provide care for members at reduced costs are called managed care plans. There are three different types of managed care plans, and can benefit individuals in different ways depending on the coverage options they are looking for. Like a lot of different things, managed care can have positives and negatives.
Managed care is where health insurance companies have contracts with health care providers and facilities to provide care to patients at a reduced price. These providers make up the plan's network. How much of your care the plan will pay for depends on the network's rules and if the provider is in that specific network. There are three different types of managed care; HMO, PPO, and POS. HMO is a health maintenance organization and this is where they usually only pay for care within that network. Some insurance companies like Summa, Anthem Blue Cross Blue Shield, and Medical Mutual offer HMO plans. A PPO is a preferred provider organization which is where they usually pay more if you get care within the network, but they still pay a portion if you go outside of the network. A few insurance companies that offer PPO plans are Anthem Blue Cross Blue Shield, United Healthcare, and Medical Mutual. A POS, meaning point of service, is a plan where it lets you choose between an HMO and a PPO each time you need care. POS plans have some of the qualities of HMO and PPO plans with benefit levels varying. “Like an HMO plan, you may be required to designate a primary care physician who will then make referrals to network specialists when needed. Depending upon the plan, services rendered by your PCP are typically not subject to a deductible and preventive care benefits are usually included. Like a PPO plan, you may receive care from non-network providers but with greater out-of-pocket costs. You may also be responsible for co-payments, coinsurance and an annual deductible ( eHealthInsurance Services, Inc., 2013).”
So what has managed care done for healthcare in general? With managed care, it has created new techniques to control healthcare costs. New technology has helped with early detection for things such as disease. With early detection comes lower healthcare costs, and since the contracts between insurance companies and healthcare providers cuts the cost down and in turn helps make tests that can help save a life a little more affordable. These plans are shifting the responsibility and financial risk of health care maintenance and management to the patient so the patient is responsible for their own health. Managed care uses utilization management which requires pre-authorization for certain tests and procedures, which can help cut down on unnecessary testing.
Managed care plans also promote market competition, which gives patient’s more options when it comes to choosing what they want.
When it comes to managed care, there have to be rules and regulations in place. State and federal regulations help govern our healthcare, the plans, and the facilities we receive our care from. State regulations vary from state to state because not every state is the same, just like not every facility is the same and not every insurance company is the same. “State health insurance laws only apply to about 45% of health policies - those "fully insured plans" in which mostly individuals and small and medium sized businesses and organizations pay premiums. Only federal ERISA law applies to the 55% "self-insured health insurance policies." The U.S. Department of Labor oversees and enforces ERISA requirements, which are generally less extensive than the state requirements noted below. Many insurers offer and administer both types of plans. Medicaid managed care plans are administered through state law but consumer and provider protections may be regulated separately from the statutes cited in this report (Cauchi, 2013).” “Many states prohibit a managed care plan from rewarding doctors for performing a less costly procedure or prescribing a less costly drug. Most states have laws prohibiting any agreement that limits doctors’ ability to inform patients of treatment options, especially if some choices may cost the insurer more. A 1997 federal law now bans gag clauses for Medicaid and Medicare managed care. In an effort to assist consumers in choosing a plan, several states now require publication of an evaluation booklet or, "report card" to report on the performance of a managed care organization (Cauchi, 2013).” There has been debate as to why we need managed care here in the United States. The reduction in the cost of healthcare has proven to be one of the biggest advantages of managed care. But, why are there still people who don’t much care for it? Managed care plans are networks of providers who provide care for patients. Those patients have health insurance through different companies and each company has a contract with certain providers and facilities so those patients have to choose an in network provider. If you need more care than your provider can give you, you may need to see a specialist. Some specialists may not be in your network, which can in turn cost you a lot more money. The concern among some is that doctors who administer care are not likely to inform their patients of all possible treatment and testing options, but rather just those that will be covered by the particular health plan. Some other concerns with managed care include the desire to keep people out of hospitals and to admit them for as short a time as possible and also members dislike the loss of privacy since the managed care company receives summaries with details of their medical conditions and treatments availed.
Shorter hospital stays represent a large cost-savings to the insurer. When staying in network, it isn’t always convenient for the patient. The physician’s schedule may not allow certain patients to make appointments around their busy schedules, and they may have to end up driving a little further to get to someone that is in network. As I mentioned earlier, the movement towards managed care was to try and save money and make the healthcare industry more profitable. There are pros and cons, as with anything, and some of the benefits out way the many disadvantages. Cutting costs can be beneficial when the cuts are made in the right places. Individuals need to have options, and with managed care they have just that. You can choose the plans that fit your budget, and the coverage you need. You can choose your deductibles as well with certain plans. Being able to freely choose your provider is not always an option when it comes to managed care plans, which can make things difficult especially if you have a provider that you trust your health to. The need for managed care really depends on who is looking at it. I think that the best choice for a managed care is a PPO, because it has a wider range of options as well as helping pay for out of network providers. I currently have Blue Cross Blue Shield PPO, and I have a lot of options when it comes to a wide variety of care including specialty care. I can go just about anywhere, the deductibles are low, and the coverage is great. It fits my needs when it comes to general doctor visits, my orthopedic doctor, and chiropractic care. In conclusion, managed care has come a long way here in the United States and has had many ups and downs. It was introduced to help cut costs in the healthcare industry for insurance companies and the patients. The contracts between insurance companies and healthcare providers is beneficial for everyone involved because in turn the patient is paying less for simple healthcare needs such as checkups and immunizations, but when you start getting into specialty care it can start costing a little more especially if the provider is not in network. With the three main types of managed care (HMO, PPO, and POS), there are many different options for individuals to choose from, and it gives you control over your own health.

Works Cited eHealthInsurance Services, Inc. (2013, August 24). Point of Service Insurance Plans. Retrieved from eHealth Insurance: http://www.ehealthinsurance.com/health-plans/pos/
Cauchi, R. N. (2013, August 23). Managed Care State Laws and Regulations, Including Consumer and Provider Protections. Retrieved from National Conference of State Legislatures: http://www.ncsl.org/issues-research/health/managed-care-state-laws.aspx
Demand Media, Inc. (2013, August 10). The Advantages of Managed Care Health Coverage. Retrieved from Livestrong.com The Limitless Potential of You: http://www.livestrong.com/article/59877-advantages-managed-care-health-coverage/
National Center for Biotechnology Information, U.S. National Library of Medicine . (2013, August 11). Medical professionalism under managed care: the pros and cons of utilization review. Retrieved from PubMed.gov: http://www.ncbi.nlm.nih.gov/pubmed/9018948
PBS and WGBH/FRONTLINE. (2013, August 10). The Managed-Care Industry in Perspectve. Retrieved from PBS Frontline: http://www.pbs.org/wgbh/pages/frontline/shows/hmo/procon/hmoperspective.html
Services, C. f. (2013, August 11). Managed Care. Retrieved from Medicaid.gov Keeping America Healthy: http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Delivery-Systems/Managed-Care/Managed-Care.html