Managed Care System - Essay Example

Till 1980’s there was only a trifle between the public and private players of health care. But, the overall payment system concentrated on fee for service basis. Accordingly, each visit was counted as an episode. The physician had the liberty to administer treatment according to his diagnosis. As private insurance mostly dominated the scene, the physicians, to fulfill their selfish ends, could also recommend for unwanted tests, hospital stays and drugs. Patient safety was their only cap and they could re-jig monetary considerations underneath this consideration.

The insurers also never complained as major bill payment was a responsibility of the employers. But, employers understanding this disadvantage started to backlash on the reasons of uncapped expenditure and over utilization of resources. This of course was a valid point. As more and more are getting enrolled into the health care, fee for service model has become outdated giving way for Managed Care Organizations (MCO’s). (Christensen. C., Grossman. J., Hwang. J. 2009) As accountability comes into picture, unnecessary expenditure gets curbed automatically.

From past 30 years, MCO’s have been well placed and growing in the market. The main postulates of their existence are: Lowered rates of hospital admission, in patient treatment, procedural expenditure. This has resulted in a mixed result of outcomes that some patients were treated satisfactorily while many did not have that contentment about care practices. Development of state insurance sector commensurate to private players. Giving an inevitable choice to the employer and employees to be enrolled into those organizations for reduced health costs.

(Anonymous., 2010). All these recommendations by the bill only point out that the MCO’s are here to stay for some more time. If not for them, accountability and cost reduction for the insurer’s purpose fulfillment would never be possible. In short, the arrangement seeks to reduce the health