quiz 2

Managed care organization- a system that integrates functions of financing, insurance, delivery and payment and uses mechanisms to control costs, and utilization of services.

type of managed care organization that providea comprehensive medical care for pre-determined anuual fee per enrollee

• employs its own salaried positions based on productivity and HMO performance there are bonuses (kaiser)
• physicians work only for employeer
• physicians in all specialities
• subspecialities are subcontracted
• abultalory office
• auxillary support services
• contracts with inpatient hospitlas
• greater degree of control over phyisicans pratices 
• disadvangtages: fixed salaries (high), limited choice of physicians, expanision into markets requires lots of money

• contracts with single OR mutli-speciality group practice (lends prestige but has limited)
• contracts seperately with one or more hospitals 
• advantages: no salary or facility expenses, well-known practice, prestige
• disadvantgages: difficulties with service obligation if the contract is lost
• large groups because they deliver a large pool of physicians under one contract

• contract with more than one medical group 
• works in large metropoltian areas and geographic areas
• common arrangments: contracts with only PCP groups
• -paid capitation fees
• -responsible for all services
• -give and manage referels and specialist re-imbursment

• independent practice association
• -a legal entity seperate from an HMO
• -contract s with indepoendent solo and group practiconers
• HMOs contract with an IPA instead of physicians
• -HMO pays capitation amount to IPA
• IPA has administrative control over how it pays its physicians
• -reimburse through capitation or other means like modified fee for service
• shares the risk with physicians
• assumes responsibility for how services are used and the quality of the services
• logistics of arranging physician services shifts from HMO to the IPA
• advantages: expanded choice of providers for enrollee, allows small physicians group and independent to particiapte in managed care

disadvantages: if contract is lost the HMO loses as a large amount of physicians, acts as a buffer bw HMO physicians, thus the IPA does not have as much control over physician practices

• preferred provider organization
• offers open-panel options for insured
• offers non-capitation for providers (by substituting discounted fee arrangements
• -no primary care gatekeeping
• prior authorization required for hospital and outpatient services
• don't have the same organizational mechanisms as HMOs for assuming corporate responsibility-cost containments nad quality control... 
• out of pocket high cost for out of network.

• employers must either provider with insurance (play) or pay into a public health insurance program (pay)
• pay never materialized because of the ERISA (self-insured business) prevents states from requiring the small business to provide insurance --Hawaii is only state to have this exemption.

• private such as a hospital that operates under a 501-c3 
• tax exempt
• in exchange for tax exemption that provide some defined public good such as service, education or community welfare and do not distribute profits to any individuals

• uses certain aestb criteria to determine the amount of reimbursement in advance b4 service
• minimizes abuses inherent in cost + approaches and enables providers suchas a medicare to better predict health care spending

• this sets rates after evaluating costs
• fee for service

• planned rationing
• carried out by government to limit availabilty of health care services (esp health technology)

rationing by the ability to pay also known as price rationing

artifical creation of demand by providers that enables them to deliver unneeded services to boost their incomes

• supplementary medical insurance
• voluntary
• party financed by tax revenues
• includes some premuim contributions
• (1965) 
• covers physician bills
• Generally pays 80% of the Medicare-approved
• amount for covered services
• –In 2007, premiums became means-tested (MMA 2003)

• hosptial insurace
•  (1965)
•  hospital and limited nursing home coverage
• Financed by mandatory payroll taxes
• •Employer and employee pay equally into the Hospital Insurance Trust Fund
• –Covers inpatient hospital care, skilled nursing facility, home health, and hospice

• ision,dentures, hearing aids, routine foot care, routine physicals, but
• •certainscreenings and vaccinations   arecovered under Part B, and•long-termcare benefit is limited 

• Medicare Advantage Plans
• additional health plans
• (1987)
• Managed Care options

• No class distinction
• Uniform national standards for eligible and benefits
• Federal program consistent across the nation

• drug coverage
• (2006) Prescription Drugs

• same insurance rate for everyone
• risk is spread among a larger community
• Pure community rating
• Modified community rating  
• –good risks help pay for poor risks 

• setting of insruacne rate based on a groups actualy haealth care expenses in a prior period allows healthy groups to pay less.
• –group’s medical claims experience–vary from group to group due to different risks

• *** requiring people to pay insurance preiums
• A health insurance mandate is either an employer or individual mandate to obtain private health insurance instead of (or in addition to) a national health insurance plan

medical insurance coverage considered inaqeduate to cover the cost of a major illness

• cross bw HMO and PPO
• still have capitation
• and open acess
• lost popularity due to high out of pocket costs 

reimbursement mechanism under whcih the providers pay a set monthly fee per enrolee sometime refered to as per month or PMPM rate regardless of whether or not enrollee see the provider and regardless of how often the enrolle e seesthe provider

• a practice used in "contract practice"
• -when making a contract with independent physicians and hospitals at a flat fee per month
• * this was actually regarded by the AMA as an unethical invasion of private practice--physicians could bid against one another and drive down the price.
• Capitation
• •Per member per month (PMPM) fee to cover all needed services
• •Monthly
• fee = PMPM rate x number of enrollees
• •Minimizes provider induced demand

• program for the indegent jointly adminestrated by the fedrale and state government
• US determines public-sector expenses and   reimbursement rates for Medicare and Medicaid
• Title XIX of SSA
• For indigent
• -Based on a means test developed by each state
• Expanded to include all age groups, not just poor
• Class distinction
• Sigma of public welfare
• Eligible and benefits vary state to state
• 20% of kids1
• 48% of adults2

assignment through contractual arrangement throuh specialized serviceto an outside organization because these services are not included in contracts MCOs have with their providers or the MCO does not provide services.