Assignment 4 Flashcards
provided federal initiatives to encourage the establishment of HMOs. consisted of federal grants and loans to organizations wishing to investigate the feasibility of “federally qualified HMOs.”
Health Maintenance Organization Act of 1973
Why didn’t many employers realize long-term cost savings with PPO
Many employers didn’t realize long-term cost savings with early PPOs because they were primarily discounted fee-for-service arrangements with little focus on utilization control
what steps did PPO companies take to correct this problem of not realizing long term savings
- increasing the monitoring of utilization
- implementing quality control
- surveying member satisfaction.
what do opponents of the PPO approach argue is the reason they are more expensive than HMOs?
Opponents of PPOs argue that PPOs are a weak form of managed care with rich benefits, making them more expensive than HMOs
the managed care company’s way of directing members to in-network providers. Commonly accomplished through setting benefit differentials between in- and out-of-network care between 10% and 30%. Critical to maximize financial results of managed care
steerage
Standalone UM programs found in traditional indemnity plans include:
- (a) Precertification of inpatient admissions
- (b) Concurrent review of ongoing confinements for medical necessity
- (c) Discharge planning
- (d) Precertification for selected outpatient services
- (e) Second surgical opinion
- (f) Case management for high-dollar cases.
This approach was used when the plan sponsor’s primary objective was to introduce a managed care plan with the least amount of employee disruption. It offered members richer preferred benefits while maintaining existing benefit levels for non-preferred benefits
Incentive PPO approach
This approach was used when the primary objective was cost savings with preferred benefits equal to the prior plan and non-preferred benefits being significantly reduced. Savings were maximized, since plan design differentials, negotiated prices and utilization management controls more than offset the administrative expense of operating the managed care plan.
Disincentive PPO approach
This approach worked best for the plan sponsor that wanted to introduce a managed care plan with some improvement in benefits while at the same time saving money. Adequate steerage was built into the plan design while balancing employee acceptance against the plan sponsor’s need for savings.
Combination PPO approach.
What is the key component of the point-of-service plan concept?
The primary care physician (PCP) is the key component of the POS concept, and preferred benefits are available only for care rendered by or coordinated through the member’s PCP. Thus, the PCP acts as a “gatekeeper” to specialist care.
What is the key distinction in level of coverage between HMOs and the PPO and POS plans?
In HMOs, the member receives no coverage for medical care or treatment received outside of the HMO, except for emergency treatment or when traveling out of the network’s coverage area. In both the PPO and POS plans, the member can still obtain care out of network and receive benefits, though at a reduced rate.
Briefly describe the basic features of an HMO
HMOs provide members with comprehensive benefits through an established provider network. Members receive rich benefits (virtually 100% coverage) in exchange for exclusive use of the HMO network and for compliance with its requirements
Contract with groups of physicians and usually link the group with various forms of financial risk sharing. While the physicians are not employed by the HMO company, they typically have large numbers of patients who are HMO members which forms a strong financial tie with the company. Members receive primary care at the medical group’s clinic or health center, with specialty referral care and hospital confinements handled through other contracted arrangements.
Group model HMOs
physicians are employed by the HMO company which pays them a salary rather than payments per service to covered members
Staff model HMOs
contract with individual practice associations (IPAs) or directly with private practice physicians. This is the most common form of HMO structure today because it requires less capital to establish and operate than the other forms require. It is also often the most popular form of HMO among members, whose current physician may already be on the panel.
IPA model HMOs
