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Managed Care

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Managed Care

For most people, the growth of managed care is confusing and frustrating, given that most individuals do not properly understand the system even as it transitions. Managed care is a healthcare delivery system organized to manage quality and utilization of costs (Medicaid.org, 2020). Medicaid managed care offers delivery of Medicaid health benefits as well as additional services through contracted agreements between state Medicaid agencies and managed care organizations accepting capitation payment for the services. By contracting with several types of managed care organizations to deliver Medicaid program healthcare services to various beneficiaries, states are able to lessen Medicaid program costs and also manage health service utilization in a better way. According to MinaSara (2015), the major aim of managed care is to control costs, monitor the quality of care, and increase patient satisfaction.

Before WWII, only 10% of employed individuals had health benefits as compared to 70% by 1955 (MinaSara, 2015). In the 1950s, Health Maintenance Organizations started to contract with fee-for-service physicians as a competitive response by Joaquin Medical Foundation to group-based HMOs by Kaiser. The San Joaquin Medical Foundation established a relative value fee schedule meant to pay physicians and monitor the quality of care. By 1993, more than 70% of Americans with health insurance were enrolled in a managed care plan. Even though managed care was discouraged by an antagonistic regulatory atmosphere, it has grown dramatically since the 1980s. Glied (2000) claims that this growth could be attributed to the organization’s reaction to core market failures in the healthcare system,  moral hazard, limited competitiveness in the industry, and limited information on the quality of care. In the 21st century, managed care is defined as any organized healthcare system that strives to eliminate or lessen services that system representatives have deemed unnecessary or ineffective, hence providing a way to hold costs down while maintaining high-quality healthcare at the same time (Mullner, 2020). The success of managed care can be attributed to influential pioneers, the government, and world events, as well as the introduction of a third-party payment system.

Current State of Managed Care in the US Health Care System

Currently, managed care has advanced into a basic component of Medicaid because it offers states the ability to better regulate costs, care and coverage and introduce and pursue relevant changes in care delivery to enhance health care and health. According to Rosenbaum et al. (2020), by 2017, around 70% of all Medicaid beneficiaries were registered in comprehensive plans offered by managed care organizations, and one research approximates that Medicaid managed care accounts for about half of all Medicaid spending. Furthermore, the National Conference of State Legislators (2017) claims that over the past 20 years, over 90 million Americans have been part of Preferred Provider Organizations, and in 2010, over 58% of employed individuals were enrolled in PPOs, followed by 19% enrolled in HMOs.

The emergence of the National Committee for Quality Assurance has increased the ability of managed care organizations to ensure excellence through accreditation. Accreditation refers to a review process that healthcare organizations take part in to show their ability to meet predetermined standards and criteria of accreditation established by a professional accrediting agency (Hicks & Nelson, 2016). Accreditation is generally considered to be a desirable process of establishing standards and working towards the increased quality of care, and this has made it possible for managed care organizations to ensure quality improvement

In present times, the coronavirus has disproportionately impacted minority communities that suffer from high levels of health issues and poverty in the country. Medicaid is at the forefront of COVID-19 treatment and testing, and various individuals are enrolled in comprehensive care plans that are offered by managed care organizations (Rosenbaum & Velasquez, 2020). Medicaid-managed care plays a central role during the pandemic. Furthermore, Kogut (2020) states that managed care pharmacy community is capable of lessening racial disparities in healthcare by providing affordable and quality care to individuals from minority communities.

Potential Impact of Health Care Reform Initiatives on Managed Care in the U.S

The Affordable Care Act is among the health care reform initiatives that are likely to impact managed care in the US. The main features of ACA are improved efficiency and quality, expanded coverage, reduced healthcare costs, and consumer protections. Expanded coverage is likely to fail in achieving universal coverage since certain states propose expanding their Medicaid programs (National Academy of Science, 2014). However, since most reforms that the ACA has brought about have sought to lessen costs and enhance patient health by expanding access to care, enhancing the quality of care, and introducing coordination and management of care, there is a higher probability of meeting the primary objectives of managed care. With healthcare reforms, there is also the possibility of reduced healthcare spending (Davis & Stremikis, 2010). Given that managed care tends to limit access to care for individuals who have no insurance, the current reforms make it possible for more individuals to be insured, and this could explain why some individuals lack proper knowledge and understanding of managed care.

References

Davis, K.,& Stremikis, K. (May 21, 2010). The Impact of Health Reform on Health System Spending. Center for American Progress. Retrieved from https://www.americanprogress.org/issues/healthcare/reports/2010/05/21/7731/the-impact-of-health-reform-on-health-system-spending/

Glied, S. (2000). Managed care. In Handbook of health economics (Vol. 1, pp. 707-753). Elsevier.

Hicks, D. & Nelson, N. (Presenter). (2016, October 19). Accreditation of health care. Retrieved from https://www.youtube.com/watch?v=3XDs7ccTQDs

Kogut, S. J. (2020). Racial disparities in medication use: imperatives for managed care pharmacy. Journal of managed care & specialty pharmacy, 26(11), 1468-1474.

Medicaid.org. (2020). Managed Care. Retrieved from https://www.medicaid.gov/medicaid/managed-care/index.html

Mullner, R.M. (2020). Managed Care. Britannica. Retrieved from https://www.britannica.com/topic/managed-care

National Academy of Science. (2014). How the ACA Will Change the Health Care Delivery System. Washington, DC: National Academies Press.

National Conference of State Legislators. (2017). Managed Care, Market Reports and The States. Retrieved from https://www.ncsl.org/research/health/managed-care-and-the-states.aspx#:~:text=Over%20the%20past%2020%20years,PPOs%20(preferred%20provider%20organizations).

Rosenbaum, S., & Velasquez, M. (July 21, 2020). States Are Using Medicaid Managed Care to Address the COVID-19 Pandemic. The Commonwealth Fund. Retrieved from https://www.commonwealthfund.org/blog/2020/states-are-using-medicaid-managed-care-address-covid-19-pandemic

Rosenbaum, S., Velasquez, M., Somodevilla, A., Gray, E., Morris, R., Handley, M., & Beckerman, Z. (July 30, 2020). How States Are Using Comprehensive Medicaid Managed Care to Strengthen and Improve Primary Health Care. The Commonwealth Fund. Retrieved from https://www.commonwealthfund.org/publications/issue-briefs/2020/jul/how-states-are-using-comprehensive-medicaid-managed-care

TheMinaSara (2015). History of managed care. Retrieved from https://www.youtube.com/watch?v=SoExSvjPnh0

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Question 

Managed Care

Assignment Overview
A few years ago, some opined that managed care was either dead or nearly dead. Years later, managed care seems stronger than ever, or is it? After reading the background information, conduct additional research and respond to the below questions.

Case Assignment
Watch the following videos in preparation for this assignment:

Use what you learned from the videos, the module’s required readings, and your own research to answer the following questions in your paper.

Managed Care

  1. What is managed care and where did it come from?
  2. Discuss the current state of managed care in the U.S. health care system.
  3. Briefly explain some of the potential impact of health care reform initiatives on managed care in the U.S.

Length: Submit a 3 page paper, not including the cover page and the reference list.

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