Managed care


Managed care has had a profound impact on the way that health care is delivered and paid for in the United States. A large portion of Healing Hands Hospital’s revenue comes from managed care reimbursement making managed care a very important part of the business process. Part of the Task Force’s work will include obtaining feedback from the community and a public relations committee has been formed to help educate the community when decisions are made about changes to Healing Hands Hospital.   Mr. Johnson, Healing Hands Chief Financial Officer, has asked you to help provide some training to the members of the public relations committee to help them understand managed care and other possible models for reimbursement including value-based reimbursement and Accountable Care Organizations (ACOs), so this can be included in their campaign of community education. Your report to Mr. Johnson should include:
Identify three types of managed care plans, such as Preferred Provider Organizations (PPO) and how they impact the way that health care is delivered at Healing Hands Hospital.
Managed care has changed dramatically in the United States over the years. What did managed care look like 10 years ago compared to how it looks today?
Discuss the future of managed care as a viable reimbursement model for Healing Hands Hospital compared to Accountable Care Organization model and valued based reimbursement.
Reimbursement by CMS for Medicare patients is also an important source of revenue for Healing Hands Hospital.  Include a description of the different models for Accountable Care Organizations (ACOs) and what would be a good strategy for Healing Hands to ensure the highest level of Medicare reimbursement for the future. 
Through legislation such as the Affordable Care Act and MACRA, there are regulations and requirements that are designed to improve patient quality of care and ensure highest levels of reimbursement.  Include how these laws impact Healing Hands Hospital and its financial plans.
Mr. Johnson, like all healthcare management professionals, believes that the data and information presented must be backed by good research and the reference sources must be listed appropriately in the written report. 
Be sure to include at least three references for the information presented in your report using APA formatting.

Sample paper

Managed care

The healthcare industry is one of the most important industries in any country considering that they help in maintaining the standard health of the populations as well as preventing diseases.  However, the rising cost of medication and treatment is increasingly becoming a burden to most people, especially those from low-income families.  To curb this challenge, the government is promoting managed care plans in the country.  Managed care refers to a group of activities undertaken by individual health care organization or a group of health care facilities to reduce the cost of offering health care facilities while enhancing the quality of the services provided (Todd, 2009).  Research shows that managed care has essentially become an exclusive system of delivering and receiving American health care.  This study will attempt to analyze and describe types of managed care plans as well as their functionalities.

Question 1

There are three types of managed care organizations that are widely used throughout America, and they include:

  1. Health Maintenance Organizations (HMOs) – they are the most prohibitive kind of managed care design as they regularly request individuals to choose a primary care doctor from whom a referral is normally required before accepting consideration from a specialist or other doctor.
  2. Preferred Provider Organizations (PPOs) – they allow members to outsource treatment, but members must incur the extra cost of receiving treatment or care outside the organization (Todd, 2009).
  • Point Of Service (POS) – this plan integrates characteristics and characteristics of both the HMOs and PPOs, but its premium is usually higher than those of HMOs.

Despite the fact that managed care helps in reducing the cost of treatment while improving the quality of the services provided, there is a higher probability of the caring physician having a conflict of interest and failing to act in the best interest of the patient. This conflict is brought by the limitation in locations of diagnostic tests, the length of hospital stay and choice of specialist.

Question 2

Managed care today is different from how it operated ten years ago.  For example, back in 1993, managed care was paying much attention to customers’ role in scoring physician presentation. Back them fulfilling the needs of the customers was the priority.  Back then a physician would be judged by the number of patients treated a day, unlike today where patients are becoming an important source of data regarding medical outcomes (Baicker & Robbins, 2015). With time, patients are increasingly becoming aware of the importance of the value of the services provided and thus are judging the outcome based on the value they get for the money they spend on the services. Additionally, patients can now be sensibly involved in satisfaction with outcomes, considering that information runs both ways to the patients and to the physician.

Question 3

With the current innovations in the market, the feature of the managed care seems uncertain.  Additionally, the passing and implementation of Obamacare which increases the number of patients visiting a hospital or accessing medical services without increasing the number of caregivers, it is becoming extremely difficult for the caregiver to provide high-quality services.  It is difficult to meet the increasing demand without increasing the number of people providing the services (Baicker, Chernew, & Robbins, 2013).  Therefore, the government needs to increase the number of caregivers in all healthcare facilities as well as training and educating the current ones to increase their efficiency, effectiveness, and performance which in turn improves the quality of the services provided.


Baicker, K., Chernew, M., & Robbins, J. (2013). The Spillover Effects of Medicare Managed Care: Medicare Advantage and Hospital Utilization. doi:10.3386/w19070

Baicker, K., & Robbins, J. A. (2015). Medicare Payments and System-Level Health-Care Use: The Spillover Effects of Medicare Managed Care. American Journal of Health Economics, 1(4), 399-431. doi:10.1162/ajhe_a_00024

Todd, M. K. (2009). The managed care contracting handbook: Planning and negotiating the managed care relationship. Boca Raton, FL: Taylor and Francis.


Healthcare Industry Overview