Thesis on "Current and Future Legislation How Will This Effect the Future of Managed Care"

Thesis 14 pages (3829 words) Sources: 10 Style: APA

[EXCERPT] . . . .

Future Legislation: The Impact on the Future of Managed Care

The focus of the research proposed in this study is to ascertain what the advantages and disadvantages exist relating to managed care and to attempt to understand the impact that the current trends and future legislation in health care will have on the future of managed care in the health care system of the United States. Unless future legislation addresses the disadvantages and drawbacks that exist in relation to the managed care of the health care system will suffer greatly not only in relation to the quality of services and care provided to patients but will as well suffer from the inability to properly train and educate medical service providers. It is likely that the impact of future health care reforms and legislation will result in changing the face of managed care so dramatically that it will fail to exist in its present form. Questions in this proposal for research include those of: (1) What impact has managed care had on the training and education of health care service providers? (2) What does future legislation relating to health care system financing need to address to optimize services patients receive from health care providers and to optimize the training and educational potential of health care service providers? And (3) What effect will the proposed health care reforms have on managed care and will managed care exist in its present form following these health care reforms?

CURRENT TRENDS & FUTURE LEGISLATION: THE IMPACT on the FUTURE of MANAGED CARE

INTRODUCTION

The focus of the research proposed in this study is to ascertain what the advantages and disadvantages exist relating to managed care and to attempt to understand the impact that the current trends and future legislation in health care will have on the future of managed care in the health care system of the United States.

STATEMENT of THESIS

Unless future legislation addresses the disadvantages and drawbacks that exist in relation to the managed care of the health care system will suffer greatly not only in relation to the quality of services and care provided to patients but will as well suffer from the inability to properly train and educate medical service providers.

RESEARCH QUESTIONS

The questions addressed in the research proposed herein are those as follows:

What impact has managed care had on the training and education of health care service providers?

What does future legislation relating to health care system financing need to address to optimize services patients receive from health care providers and to optimize the training and educational potential of health care service providers?

What effect will the proposed health care reforms have on managed care and will managed care exist in its present form following these health care reforms?

BACKGROUND to the STUDY

The work of Gottlieb and Einhorn entitled: "Current Concepts Review - Managed Care: Form, Function and Evolution" states that the concept of the "HMO has its origins in the National policy of the 1970s. (1997) it is reported that complaints were stated related to "insufficient access to medical care and concern that the United States was inferior and inefficiently administered. In 1970, in response to calls for national health insurance from Democrats and some Republicans as well as to sharply rising health-care costs, the Nixon administration began to explore ways to achieve more efficient, less costly medical care and thus to quiet critics." (Gottlieb and Einhorn, 1997)

There was alarm by the administration at that time since the proposals for nationalized health care was a popular issue so the Nixon administration searched for a strategy that might compete on a political level with this plan and resulting was an alternative national health plan that had the HMO centric in the approach. This plan was initially termed the 'Health Maintenance Strategy" which would enable those receiving Medicare to make a choice between traditional fee-for-service systems and the HMOs. It was anticipated by those designing this plan that the actions of the government would serve to "catalyze similar restructuring in the private, largely employer-financed segment of the health-care economy, which, at the time, was also having difficulty coping with medical inflation." (Gottlieb and Einhorn, 1997)

Resulting was the Health Maintenance Organization Act of 1973 authorizing the federal government to loan funds to new HMOs who were unable to obtain private funding. Qualifications that were required were the offering of some specialty services as well as "open enrollment, community ratings..." As well as other features. This act however, did not pass the Congress which was controlled by Democrats at that time but some parts of it were incorporated into later legislation. It is stated that the Nixon legislation served to usher in an "...era during which the government took an active role in helping the HMO industry to grow. For more than a decade, until President Reagan phased out programs geared toward subsidizing HMOs, the managed-care industry enjoyed explicit support from the federal government in the form of grants and start-up money. From 1974 to 1980, the federal government contributed $190 million to the development of new HMOs." (Gottlieb and Einhorn, 1997)

Business leaders had become dissatisfied with the insurance industry by the middle of the 1970s and held that they "...were paying commercial insurers large fees to do little more than process hospital and physician claims for their covered employees. As a result, businesses began to self-insure. Gradually, most large and medium-sized employers cut back or entirely discontinued their reliance on commercial insurers. Surprisingly, most for-profit carriers failed to protect their profitable niche in the expanding health-insurance market." (Gottlieb and Einhorn, 1997) the HMKs had gained in their marketing influence by the early 1980s and sought a "greater role in the vast health-care market." (Gottlieb and Einhorn, 1997) by the beginning of the 1980s there are stated to have been three major health-insurance arrangements which are stated to be the following:

1). Approximately 90 per cent of working Americans and their dependents were covered by conventional indemnity health-insurance plans, purchased by employers as a benefit. Under a typical employment-linked plan, consumers were free to choose any available provider. Physicians were faced with few constraints and practiced more or less as they wished. The insurance company usually served as a passive intermediary between the employer and the provider. With little scrutiny, insurers typically paid bills submitted to them on a fee-for-service, retrospective basis. For the most part, insurers let providers determine the rates of reimbursement. The government-sponsored insurance programs (Medicare and Medicaid) were not much different. Although slightly less flexible, they were patterned directly on this traditional employee-health-benefit model. Moreover, private-sector insurance companies performed most of the day-to-day management of the Medicare program, further blurring any distinctions";

2) the second major type of health-insurance plan, the prepaid HMO, was the preferred arrangement for only about 5 per cent of Americans in 1980. However, the industry was still in its early stages. Approximately 80 per cent of HMO enrollees received care from so-called closed-staff or group-model HMOs, where physicians practiced in large, organized, multispecialty group settings; and 3) the remainder were enrolled in open-panel independent-practice associations, consisting mainly of physicians practicing in small groups or alone who wanted to compete with the larger, closed-panel plans." (Gottlieb and Einhorn, 1997)

According to Gottlieb and Einhorn there are four primary types of arrangements in managed care:

the staff-model HMO;

the group-model HMO;

the preferred-provider organization, or network model; and the independent-practice association. (1997)

Gottlieb and Einhorn describe each of these as follows:

Staff-model HMO: A staff-model HMO directly employs its doctors and health-care staff and usually owns its own hospitals and clinics. The HMO provides services at one clinic location or more through its own staff physicians. A well-known example of this type of model is the Kaiser-Permanente Plan;

Group-model HMO: A group-model HMO operates essentially as a partnership among a group of doctors, hospitals, and the membership plan. Under this arrangement, a single large multispecialty group practice is the sole (or major) source of care for an HMO's enrollees. The HMO provides services to enrollees by contracting with at least one physician-owned group practice or clinic. HMO members are seen in the medical group's office. Because of the similarity with the staff-model HMO, the term staff/group-model HMO is often used to denote these large HMOs;

Preferred-provider organization: To provide health-care services to enrollees, preferred-provider organizations contract with both large physician-medical group practices and independently practicing physicians. The preferred-provider organization enters into contracts with a broader range of health-care providers and is thought to offer enrollees more points of service (facilities and doctors from whom the enrollee is permitted to receive care and still be reimbursed by the managed-care plan), although often at the expense of higher premiums. There are variants of the preferred-provider organization, but enrollees typically receive all of their care for a flat monthly charge as long as they use the plan's so-called preferred hospital or doctors, or both. If enrollees seek care elsewhere, they… READ MORE

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