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These organizations are liable to provide the individuals who are registered with recognized medical services at a lowered cost. Usually these organizations tend to charge a small amount of premium from an individual every month for which their medical requirements are fulfilled. These individuals are then referred to a set of doctors or hospital where they can seek their health insurance with accordance to the guideline laid out by the HMO. Over the years HMO has expanded such that it is recognized by many hospitals and doctors and these hospitals and doctors are being paid a particular sum of money by these HMOS to ensure continuous health care facilities. But with ease of expenses on individuals these HMOS also have their disadvantages which are both affecting the doctors and the hospitals in a certain way. This essay would further bring light upon these issues and how they are affecting hospitals and doctors (Coombs 2005; Spece et al 1996).
Previously hospitals had great benefits when they provided the patients with care as the patients were directly liable to pay to the hospitals. However after the arrival of HMOs it has become known that these hospitals have become hesitant in providing the patients with the necessary health care. The problem arises when these hospitals to maintain their good image follow the HMO guidelines but still provide the patients with expensive care. It is seen that if the patient is recommended expensive care by the hospital authorities or doctors, the hospital is putting itself on ‘risk’. In simple terms if HMO denies the expensive care given to the patient by the hospital authorities then the hospital can simply go into a deficit in monetary terms. It is known that these HMOs pay a specific amount of money per patient to the hospital and the hospital thereafter has to manage the patients under the given circumstances. This impacts the image of the whole hospital as
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