Managed care is now nearly ubiquitous in the U.S., but has attracted controversy because it has had mixed results in its overall goal of controlling medical costs.
[5] In a 2004 poll by the Kaiser Family Foundation, a majority of those polled said they believed that managed care decreased the time doctors spend with patients, made it harder for people who are sick to see specialists, and had failed to produce significant health care savings.
[5] Meanwhile, insurers responded to public demands and political pressure by beginning to offer other plan options with more comprehensive care networks—according to one analysis, between the years 1970 and 2005, the share of personal health expenditures paid directly out-of-pocket by U.S. consumers fell from about 40 percent to 15 percent.
Data indicating whether this increase in use was due to voluntary or optional service purchases or the sudden access lower-income citizens had to basic healthcare is not available here at this time.
[9] Despite managed care's mandate to control costs, U.S. healthcare expenditures have continued to outstrip the overall national income, rising about 2.4 percentage points faster than the annual GDP since 1970.
In addition, 26 states have contracts with MCOs to deliver long-term care for the elderly and individuals with disabilities.
The states pay a monthly capitated rate per member to the MCOs that provide comprehensive care and accept the risk of managing total costs.
High-deductible health plans are used by insurers to keep costs down by incentivizing consumers to select cheaper providers and possibly utilize less healthcare.
Reference price schemes are another method to share costs, where a health insurer will only pay a certain amount and anything above that must be paid out of pocket.
Here is a list of common organizations: As of 2017, the largest commercial plans were Aetna, Anthem, Cigna, Health Care Service Corp, UnitedHealthcare, and Centene Corporation.
[30] Kaiser Permanente was the highest-ranked commercial plan by consumer satisfaction in 2018[31] with a different survey finding it tied with Humana.
As defined in the act, a federally-qualified HMO would, in exchange for a subscriber fee (premium), allow members access to a panel of employed physicians or a network of doctors and facilities including hospitals.
Typically, services are not covered if performed by a provider not an employee of or specifically approved by the HMO unless it defines the situation to be an emergency.
Financial sanctions for use of emergency facilities in non-emergency situations were once an issue, but prudent layperson language now applies to all emergency-service utilization, and penalties are rare.
Since the 1980s, under the ERISA Act passed in Congress in 1974 and its preemptive effect on state common law tort lawsuits that "relate to" Employee Benefit Plans, HMOs administering benefits through private employer health plans have been protected by federal law from malpractice litigation, on the grounds that the decisions regarding patient care are administrative rather than medical in nature.
An Independent Practice Association is a legal entity that contracts with a group of physicians to provide service to the HMO's members.
Physicians who participate in IPAs usually also serve fee-for-service patients not associated with managed care.
A membership allows a substantial discount below their regularly charged rates from the designated professionals partnered with the organization.
Policies may vary from low cost to all-inclusive to meet different demands of customers, depending on needs, preferences, and budget.
Major Medical Protection covers costs of serious illnesses and injuries, which usually require long-term treatment and rehabilitation period.
Basic and Major Medical Insurance coverage combined are called a Comprehensive Health Care Plan.
Many "traditional" or "indemnity" health insurance plans now incorporate some managed care features, such as precertification for non-emergency hospital admissions and utilization reviews.
They argue that there is no consistent, direct correlation between the cost of care and its quality, pointing to a 2002 Juran Institute study which estimated that the "cost of poor quality" caused by overuse, misuse, and waste amounts to 30 percent of all direct healthcare spending.
The term "Professional Caregiver Insurance Risk"[39][40] explains the inefficiencies in health care finance that result when insurance risks are inefficiently transferred to health care providers who are expected to cover such costs in return for their capitation payments.
The HMO Act in 1973 included a voluntary program of "federal qualification", which became popular, but over time this role was largely taken over by the National Committee for Quality Assurance (NCQA), which began accrediting plans in 1991.