Managed Care and Accountable Care Organizations

Managed Care and Accountable Care Organizations

The patient (consumer) has the right and the inherent responsibility to choose their insurance plan in the healthcare industry. The patient must be aware of the healthcare system and how the plans best meet their requirements. Most patients want high-quality care, positive patient-provider relationships, and low costs. Cost is a major consideration in insurance plans and the healthcare system. In the United States, 91.2 percent of people had insurance that covered them for all or part of 2016. (US Census Bureau, 2017). In this essay, I will discuss the similarities, differences, and disadvantages of MCOs, HMOs, PPOs, POSs, and ACOs, as well as the similarities, differences, and disadvantages of a Consumer-Driven Health Care Plan (CDHP) and the future of CDHPs, MCOs, HMOs, PPOs, POSs, and ACOs.

Comparison

MCOs. “Managed care organizations, or MCOs, are for-profit private companies that receive a set fee from the state for each person for whom the company manages health care. MCOs are solely responsible for paying claims to providers with state funds, and they make a profit by keeping those costs below the state-provided level” (Campbell, 2016). Managed healthcare plans have three main types of features: health maintenance organizations (HMOs), preferred provider organizations (PPOs), and point of service (POS) (POS). MCOs have several advantages, including lower costs, easy transfer of medical information to different providers, and patient access to more providers within the network. Some disadvantages include the patient’s limited provider selection, longer appointment wait times due to a busy network, and a more scrutinized dollar in terms of referrals and specialty tests or treatment.

HMOs. A health maintenance organization (HMO) is a “managed care plan that provides or arranges for the provision of health care services to a defined group of participants on a prepaid basis for a fixed fee” (Ebrary.net, 2018). Closed panel (only pays for services in the network), staff model (HMO employs physicians), group model (HMO contracts with multispecialty groups), and open panel are the characteristics and types of HMOs (allows access to outside network with restrictions). The most significant distinction and disadvantage are that HMO is network-based, which means that services will be provided within the network, which includes the doctor, other health care providers, and hospitals. The primary care doctor also makes referrals. Emergency and urgent care are the only exceptions to the HMO plan.

PPOs. Although PPOs provide a network of providers to meet medical needs, patients are free to visit any provider in or out of the network, as well as any hospital. One of the most important aspects is that the patient does not require a referral from their primary care physician. Another advantage is that the PPO network is larger than the HMO network. The disadvantage of PPO is that it is more expensive due to copays, premiums, and annual deductibles.

POSs. This plan is a hybrid because it combines HMO and PPO benefits. The patient has an in-network PCP; however, if they do not have a referral from their PCP, they can receive treatment outside of the network for a fee. Geographically separated families or individuals have an advantage because they have more flexibility. The disadvantages, as with PPOs, are higher costs when visiting out-of-network providers.

ACOs. “Accountable care organizations (ACOs) are formed by collaborating organizations, such as physician organizations, hospitals, and payers, to organize care with the goal of reducing costs while improving health care quality and patient outcomes” (Fulton et al., 2015). ACOs provide better care and physician-directed treatment. In this plan, the provider is held more accountable. Access to medical records is one of the plan’s differences, and the design was based on sharing medical information, which contributes to the success of ACOs. The disadvantage is the cost for IT to run the EMR system, which is one of the plan’s main benefits.

	MCOs	HMOs	PPOs	POSs	ACOs	CDHPs
Network Provider Plan	See HMOs, PPOs, and PSOs	Yes, with referral options	In/Out of network options	Yes, with referral options	Partnering Organizations	Yes, with referral options and fees
Out-of-network Fees?	See HMOs, PPOs, and PSOs	Sometimes	No	Sometimes		Sometimes
					N/A
Associated with HSAs?	No	No	No	No	No	Yes, with referral options and fees
High-deductible?	No	No	No	No	No	Yes
Physician-driven?	No	No	No	No	Yes	No
Access Restriction?	See HMOs, PPOs, and PSOs	High Restriction	Least restrictive	Semi- restrictive
					N/A	N/A
PCP?	See HMOs, PPOs, and PSOs	Yes	Any provider	Yes	Provider Collaboration s	Yes

Plan for Consumer-Driven Health Care

A consumer-driven healthcare plan is not the same as the plans listed above. It is a plan with a high deductible. The majority of out-of-pocket expenses are paid before coverage begins (pre-tax dollars), allowing consumers to better manage their healthcare and plan. The lower monthly premiums are an advantage, but the higher deductible is a disadvantage. The employer benefits from this plan because their costs are reduced. The goal is for the employee to be more informed about healthcare plans and to have more control over their personal needs.

Future

CDHPs are the way of the future. Any strategy that is centered on the consumer and technology is the right strategy. The patient can plan ahead of time and is more cost-conscious with this plan. Furthermore, it is the future due to the tax advantages associated with CDHP-related health savings accounts (HSA). Through apps and videoconferences, technology is used to connect providers and patients. ACOs will have a brighter future than MCOs. MCOs will soon be a thing of the past.

Conclusion

The most important puzzle piece that should drive insurance plans is the consumer. Customers should conduct research to find the plan that best meets their medical needs. Some plans are more expensive but more flexible. Other plans have strict rules about which providers can be used and whether they are within or outside of our network. Everyone can find an affordable plan, and healthcare is critical. In this essay, I discussed the similarities, differences, and disadvantages of MCOs, HMOs, PPOs, POSs, and ACOs, as well as the similarities, differences, and disadvantages of a Consumer-Driven Health Care Plan (CDHP) and the future of CDHPs, MCOs, HMOs, PPOs, POSs, and ACOs.

References

Campbell, S. (2016). Managed care. Arkansas Business, 33(27), 1-16. Retrieved from https://search-proquest-com.ezproxy.trident.edu/docview/1805180118?accountid=28844

Ebrary.net. (2018). Types of Managed Care Plans – Introduction to health care services – Academic library – free online college e-textbooks. Retrieved from https://ebrary.net/13553/health/types_managed_care_plans

Fronstin, P. & MacDonald, J. (2008). Consumer-Driven Health Plans: Are they Working? Retrieved from http://online.wsj.com/ad/employeebenefits-consumer_driven_plans.html

 Fulton, B. D., Pegany, V., Keolanui, B., & Scheffler, R. M. (2015). Growth of Accountable Care Organizations in California: Number, Characteristics, and State Regulation. Journal of Health Politics, Policy & Law, 40(4), 669-688. doi:10.1215/03616878-3149988

Gabel, J. & Ermann, D. (1985). Preferred provider organizations: Performance, problems, and promise. Health Affairs. 4(1): 24-40.

Lee, P., & Hoo, E. (2007). Beyond Consumer-Driven Health Care: Purchasers’ Expectations Of All Plans. Retrieved from https://search-proquest- com.ezproxy.trident.edu/docview/209219086?pq-origsite=summon

US Census Bureau. (2017, September 12). Health Insurance Coverage in the United States: 2016. Retrieved from https://www.census.gov/library/publications/2017/demo/p60- 260.html

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Discuss the differences and similarities between Managed Care Organizations (MCOs) vs. Accountable Care Organizations (ACOs). Given the current healthcare environment, provide solid speculation as to how MCOs and ACOs may transform to meet the needs of their consumers. Be sure to support your thoughts and analysis with scholarly sources.

*Will also need to respond to 3 classmates’ posts, will send that after you turn in an assignment.