Question

Please describe the ways in which facilities are paid through managed care organizations? Is there a process that's more effective than others? Please explain why or why not that may be the case.

Answer 1

A managed care organization is a health care company which might include a group of doctors, hospitals, pathological labs, radiology test centers etc.

Managed care organizations take the sevices of various smaller units which may be private or semi-private. Mostly, these organizations negotiate with such service providers in two ways - [a] on a fee for sevice basis, and [b] they pay a fixed amount to the service providers on the basis of the service they provide.

There are three types of managed care plans [i] Health Maintenance Organization [HMO]

[II] Preferred Provider Organizations [PPOs], and

[iii] Point of Service [POS]

MCOs help to reduce cost and time and make medical aid faster and more efficient. It helps to reduce the cost of health care services by stimulating competition and streamlining administration.

The purpose and goal of MCOs is to save money by keeping people healthier in the first place, so that they do not have to utilize costly services.

So, to ensure continuous and effective care, it is better to pay a fixed amount to the service provider on the basis of the service they provide.