Managed Care Essay

Managed Care Brooke McMichael University of Scranton Abstract This paper examines the benefits and issues with managed care. The benefits include patients receiving preventative care, lower premiums, lower costs of prescriptions, fewer, unnecessary procedures, and less paper work. Some issues with managed care include limitation on doctors that patients can choose from, restricted coverage, the possibility of under treatment, and compromised privacy. Managed care effects nursing by causing significantly few jobs for registered nurses, more opportunities in non-acute health care settings, and more use of advanced practice nursing.

Managed Care With the economy in shambles and the rising cost of health care, many people are turning to managed care programs for health care coverage. The number of patients participating in “discounted” managed care programs is presently at a shocking all-time high. Over 150 million people are currently enrolled in some kind of managed care program, which attributes to about 60 percent of the population (Bertrand, 1996-2007). The main purpose of managed care is to provide high quality care at an affordable low cost. Managed care programs are said to have the best of both worlds. However, it is hard to find an even balance between the two.

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With such drastic restraints on spending and cost, the question of whether or not the quality of care is up to par comes into play. What is Managed Care? Managed care is a type of health care program provided by a corporation that both finances and delivers health care services of high quality at a low price by focusing on prevention, health promotion, and primary care (Huntington, Health care in Chaos: Will We Ever See Real Managed Care? , 1997). In these programs, groups of doctors, hospitals, and health care providers join together to provide affordable health insurance to the public (Cohen, 2008).

Providing preventative care helps keep costs down for insurance companies because it lowers the chances of patients’ developing certain diseases and illnesses that would be more expensive to treat. Having a single primary care provider helps in cutting costs because the person receiving care pays a single doctor to manage a patient’s health care and treatment plan that best suits them. History In the beginning of the 19th century, various alternative healthcare arrangements began to pop up throughout the country (Tufts Managed Care Institute, 1998).

These health care arrangements were made to provide workers of the lumber, mining, and railroad industries and their families with adequate health care (Tufts Managed Care Institute, 1998). In these contracts, the participants paid the doctors a set fee and in turn, were provided with essential health care for them and their families. The exact structures of these systems varied, but the basic foundations were the same. During World War II, Henry Kaiser took notice of one of these prepaid systems that was set up by Dr.

Sidney Garfield in his shipyards and steel mills on the West Coast and decided that it should be made available to the general public (Tufts Managed Care Institute, 1998). Interestingly enough, the American Medical Association was opposed to anyone having control over medical professionals and tried to do everything they could do to deter patients from the early types of managed care programs. Their methods worked up until the 1970s when the country could no longer afford the outrageous costs of healthcare (Tufts Managed Care Institute, 1998).

Several small issues from the beginning evolved into greater problems that could no longer be avoided. With no cost containment people were running out of ways to pay for their healthcare. Services were not accessible to everyone. Many people were uninsured. The need for drastic reform developed. The government turned to managed care for a solution to the health care crisis (Chitty & Black, 2007). Types of Managed Care Four different types of managed care programs evolved during this period of reform. The two main types are health maintenance organizations (HMO) and Preferred Provider Organizations (PPO).

In a health maintenance organization, a contract is made between enrollees and a panel of providers. The enrollees use the method of capitation for payment, meaning they pay a predetermined fixed fee monthly for a period of one to three years regardless of how many times they use their medical service or of how much it costs each time (Chitty & Black, 2007). In a preferred provider organization the a contract is made between the client and a group of independent doctors that team with hospitals to provide cheaper health services for their patients (Chitty & Black, 2007).

They are able to provide some of the lowest fees because they have such high volumes of patients to make up for the discounted price (Huntington, Glossary For Managed Care, 1997). There are also two other less common forms of managed care. Point-of-service organizations differ from the previous two forms because they allow their clients to choose a doctor outside of the network for a slightly higher copayment (Chitty & Black, 2007). The last type of managed care involves a hospital corporation teaming with a select group of medical staff.

Their teams then negotiate with managed care organizations or self-insured employers to set fees for different services (Chitty & Black, 2007). Managed Care for Everyone Managed care has become so popular because of its capabilities to deliver health care at affordable rates for everyone (Huntington, Health care in Chaos: Will We Ever See Real Managed Care? , 1997). Employers are able to provide their employees with insurance which works out for both the employers and the employees. Jobs offering health coverage attract more prospective applicants by giving benefits.

Employees are given quality health insurance for their family at reasonable prices. Medicaid, a managed care program, provides the elderly people and disabled people with access to health care (Burns, 2009). Positive Aspects of Managed Care Many positive benefits branch out from managed care plans. Patients in managed care programs are provided with preventative care. Managed care focuses on keeping patients healthy. By giving their patients preventative care, they eliminate avoidable illnesses and therefore, deter costs (Chitty & Black, 2007).

Some examples of preventive care that they provide are yearly check-ups, vaccinations, and cancer screenings (mammograms). Another positive aspect is that doctors are less likely to send you for unnecessary tests and procedures. Managed care programs give doctors incentives to keep down costs, preventing them from ordering excessive tests and operations (Outlining the Pros and Cons of Managed Care, 1997). Managed care programs save clients money in a number of ways. Patients only have to pay low premiums for coverage with copayments ranging from only ten to fifty dollars (Cohen, 2008).

These programs are able to provide such low prices because they depend on their rates to draw in higher numbers of clients to balance the offset. Another benefit of being enrolled in one of these programs is the discounted prices on prescriptions. MCOs cover a wide range of prescriptions and patients sometimes can have copayments as low as two dollars (Outlining the Pros and Cons of Managed Care, 1997). Because managed care physician try to get as many patients through their offices as they can, visits are short and concise (Bertrand, 1996-2007). The patients only have to sit in the waiting rooms for brief periods of time.

In addition, paperwork is expedited for the patient. Doctors and health administrative assistants take care of a majority of the paperwork, so that they can deal directly with the MCOs for billing purposes (Outlining the Pros and Cons of Managed Care, 1997). Negative Aspects of Managed Care From the outside, managed care seems to be a flawless solution to the problems of health care, but as we start to look a little deeper, the silver lining begins to fade away. Some believe it causes more harm than good. With so much pressure put on doctors to keep costs low and profits up, we being to wonder how this really affects the quality of care.

Quality care can be very expensive. Doctors are given money incentives, such as bonuses if they keep costs down, giving them the wrong motivation when caring for their patients (Fang & Rizzo, 2008). Many doctors take this financial incentive over the health of their patients. In some cases doctors sign contracts with companies that impose “gag” rules, which inhibits doctors from letting their patients know all possible treatment options if they are “too expensive”, even though they might be the best choice for treatment (Huntington, Health care in Chaos: Will We Ever See

Real Managed Care? , 1997). In managed care programs, the primary care physician must refer a patient to a specialist in order for it to be covered under their plans. To minimize costs, the companies try to deter doctors from referring patients to specialists that may cost more which can have a detrimental effect on patients (LaTourette, 1997). According to a recent research study, mandatory MCO participants were thirty-two percent more likely to have trouble getting a referral to a specialist (Burns, 2009).

This raises concern for the patient because sometimes cases are too severe to be handled by a primary care physician who is not specialized and educated enough to treat the patient’s disease (Bertrand, 1996-2007). Sometimes patients also need a referral to go to the emergency room in order for the care to be covered which also endangers the patient. All of these processes waste time All treatments and procedures must be approved by the managed care companies before they are carried out which can waste a lot of valuable time.

In a research study on breast cancer patients in managed care programs, the women were frustrated over how long it took to get approved for must- have treatments (Wenzel & Steeves, 2008). They also experience great anxiety over waiting to see if their treatments were justified enough to become improved. Many had felt that the whole experience with managed care was worse than the cancer itself (Wenzel & Steeves, 2008). Many times treatments and procedures are simply denied under utilization review if they are not proven to be “medically necessary” (Mental Health America, 2009).

Bertrand (1996-2007) states an example of this: “a CT scan or an MRI are often prescribed by a private physician to eliminate less common might be disallowed by an HMO because the procedures cost $800- $1000, and considered unnecessary” (p. 1). Another issue of managed care is that they rush doctors to get patients treated in hospitals out at a predetermined time even if the doctor feels that they are not ready to go home. Different reasons for hospitalization have a certain “length of stay” period that the doctors have to work around to get patients back at home in the allotted amount of time (Huntington,

Health care in Chaos: Will We Ever See Real Managed Care? , 1997). This situation can also have damaging effects on the patient’s well-being if proper care is not continued at home. Patient confidentiality is another issue that comes into play with managed care (Outlining the Pros and Cons of Managed Care, 1997). HMO programs require their primary care physicians to be evaluated for performance and efficiency on a regular basis. The HMOs use patients’ medical record to give the doctors evaluations.

Therefore, many other people have access to the patients’ medical records (Outlining the Pros and Cons of Managed Care, 1997). One final issue with managed care programs is that patients that are victims of malpractice are unable to sue the managed care companies that give them care (Bertrand, 1996-2007). These programs are able to offer such low prices because they do not have to have as much malpractice insurance. Therefore if something happens to a patient because the right tests were not allowed to be ordered for diagnosis, the insurance company that denied the test is not at fault (Bertrand, 1996-2007).

This is definitely an issue that needs to be addressed by the government. How Does Managed Care Affect Nursing? Even though it may seem that managed care doesn’t really affect nursing, it does in many ways. Managed care programs focus on keeping costs lower. One way that they do this is by hiring fewer registered nurses and replacing them with cheaper less qualified staff (Huntington, Health care in Chaos: Will We Ever See Real Managed Care? , 1997). The drastic increase in managed care programs at hospitals has created a significant job loss for registered nurses.

Also with doctors being pressured to get patients out of the hospitals and home in shorter amounts of time, the need for nurses in home-health settings is steadily increasing (Huntington, Health care in Chaos: Will We Ever See Real Managed Care? , 1997) . This provides more opportunities for nurses to work in different settings other than hospitals. Advanced practice nurses are a great way to minimize costs in managed care programs. Advanced practice nurses are a great, less-expensive alternative to physicians (Hansen-Turton, Ritter, & Torgan, 2008).

Advanced practiced nursing includes nurse practitioners, certified nurse anesthetists, and nurse-midwives. They provide comparable quality care at a lower cost. It would seem that most managed care programs would jump at the opportunity to use these nurses to save money. However, the opposite seems to occur more frequently. Managed care programs single advanced practice nurses out and will not reimburse them for their quality care (Hansen-Turton, Ritter, & Torgan, 2008). There is even legislation that attempts to prevent such issues from occurring, but managed care programs find ways around it.

This is another issue that needs more attention from the government. Solutions to the Problematic Errors of Managed Care To solve the problematic errors of managed care, the issues need to be brought to the attention of the government so that reform can take place. More nurses need to unite together and join the American Nurses Association to work on these issues together. Nurses need to prove their cases to the government so that legislators can pass laws to fix the flaws in managed care. Nurses should also work more closely with managed care insurers and providers to improve managed care programs.

Nurses see these problems first-hand and they need to share these findings with the companies. As advocates, nurses need to educate the public about the problems with managed care so that they can also fight for reform. Conclusion In conclusion, managed care has many wonderful, positive aspects that provide people with the opportunity to receive quality, preventative care that is both efficient and cost effective. However, there are several issues with the managed care systems that need improvement.

By educating the public on these issues and allowing them to acknowledge their importance of these issues, we can all join together and write to our legislators demanding reform in the problems that are associated with managed care. Together, we can influence and shape managed care systems, allowing us to take great steps forward in perfecting managed care programs. References Bertrand, C. A. (1996-2007). Managed Care- Solution or Problem? Retrieved Novemeber 2, 2009, from Medicine Up to the Minute: http://www. medicineuptotheminute. com/mgdcare. htm Burns, M. E. (2009).

Medicaid Managed Care and Health Care Access for Adult Beneficiaries with Disabilities. Health Services Research , 1521-1541. Chitty, K. K. , & Black, B. P. (2007). Professional Nursing: Concepts and Challenges. St. Louis: Saunders, Inc. Cohen, D. (2008, February 19). Health Insurance Types- HMO and PPO- Pros and Cons. Retrieved September 9, 2009, from Ezine Articles: http://wzinearticles. com/? Health-Insurance-Types—HMO-And-PPO—Pros and Cons&id… Fang, H. , & Rizzo, J. (2008). The changing effect of managed care on physician financial incentives. American Journal of Managed Care , 653-660.

Hansen-Turton, T. , Ritter, A. , & Torgan, R. (2008). Insurer’s Contracting Policies on Nurse Practitioners as Primary Care Providers. Policy, Politics, ; Nursing Practice , 241-248. Huntington, J. A. (1997). Glossary For Managed Care. The Online Journal of Issues in Nursing . Huntington, J. A. (1997). Health care in Chaos: Will We Ever See Real Managed Care? The Online Journal of Issues in Nursing . LaTourette, S. C. (1997). Managed Care: A Legislator’s Viewpoint. The Online Journal of Issues in Nursing . Mental Health America. (2009). Dealing with Treatment Denials.

Retrieved November 1, 2009, from Mental Health America: http://www. mentalhealthamerica. net/go/help/how-to-pay-for-treatment/dealing-with-treat… Outlining the Pros and Cons of Managed Care. (1997). Retrieved September 9, 2009, from Surviving Managed Care: http://www. ecnnews. com/hlth/man3. htm Tufts Managed Care Institute. (1998). A Brief History of Managed Care. Retrieved November 2, 2009, from Tufts Managed Care Institute : http://www. tmci. org/downloads/BriefHist. pdf Wenzel, J. , & Steeves, R. H. (2008). Experiencing Breast Cancer in Managed Care. Qualitative Health Research , 1477-1488.


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