Managed care plans offered by my employer
Managed care in the United States is the leading form of healthcare insurance whose popularity gained momentum in the last decade. It was initiated to propose solutions to the expensive health care in the 1920s and 1940s. Healthcare providers form a network of facilities which policyholders visit. The policyholders can also visit health facilities outside the network, but they pay more money out of their pockets than when they visit facilities in the network. I am going to discuss the three types of managed care plans offered by my employer in terms of their employee cost sharing, premium contribution, covered benefit and freedom of provider choice. I will also discuss the consumer-directed healthcare plan that is offered by my employer.
Health Maintenance Organizations (HMO)
In this plan, members pay a monthly fee as stipulated in the policy. The policyholders of this healthcare plan enjoy a range of services ranging from clinic visits to surgery procedures and inpatient services. Most members are restricted to visit healthcare providers in the established network. If they attend non-participating health facilities, then they pay more out-of-pocket money than when they attend facilities in the network (Baker, Bundorf & Kessler, 2010).
The HMO’s members have to choose a physician in the network. Before a member visits other doctors, he or she has to consult the primary care physician. This rigidity explains why the plan is the cheapest among the three plans (Baker et al., 2010). This plan of managed care does not have deductibles. In addition, only little co-insurance is paid by policyholders (Ji & Liu, 2007).
Preferred Provider Organizations (PPO)
This is a post-paid managed care plan. Health facilities in a network of healthcare providers offer services to health insurance policyholders at reduced cost (Hurley, Strunk & White, 2004). The organization involves a group of health facilities, doctors or specialists and the contracting healthcare insurance company. The healthcare facilities also benefit by charging insurance companies fees for operating in their network. Policyholders get approvals from the insurance company for treatment to be offered. It is the policyholder who pays for the services rendered; the company reimburses the cost after the policyholder applies for the reimbursement (Hurley et al., 2004).
However, before the company reimburses the cost to the policyholder, its representatives have to verify that the right medical treatment was given. This plan gives the policyholder the freedom to choose healthcare providers. However, there are higher out-of-pocket payments made to healthcare facilities outside the network than those in the network. This health plan has deductibles when members visit health facilities outside the network. This amount is set high to discourage policyholders from visiting hospitals outside the network. The PPO plan that my employer has organized for its employees has co-payment. It is a form of sharing between the policyholder and the healthcare insurance provider.
Before a policyholder can consult other physicians or specialists, his or her primary healthcare physician has to be consulted. Typically, the PPO plan covers 70% of healthcare cost while the remaining 30% is paid through co-insurance. The premium paid by the employer on behalf of employees depends on the job group and the benefits an employee wants from the healthcare plan. Lastly, the plan covers both inpatient and outpatient healthcare (Hurley et al., 2004).
Point of Service (POS) plans
This plan combines the features of both the PPO and the HMO healthcare plans (Robinson & Ginsburg, 2009). A policyholder chooses his or her own primary care physician who must be contacted before he or she can visit other doctors. There are no deductibles paid by a policyholder unless he or she visits health facilities outside the established network. Also, a policyholder pays very little co-insurance. However, when a policyholder visits a health facility outside the network, he or she will have to pay considerable amounts of co-payment and co-insurance.
In addition, when a policyholder visits a health facility outside the network he or she does paperwork. However, the paperwork is done for him or her when he or she visits facilities in the network. The premiums and the benefits of the cover are similar to those in PPO and HMO (Ji & Liu, 2007).
Consumer-driven healthcare plan
In a consumer-driven healthcare plan (CDHP), an employer contributes an amount of money that goes into an employee’s Health Reimbursement Account (HRA). This amount ranges from 1,000 USD to 2,000 USD per year. An employee accesses the funds in HRA at the end of the year to pay for the healthcare provided (Robinson & Ginsburg, 2009). If the funds are not sufficient, then the employee has to pay the extra money from his or her pockets. On the other hand, extra funds for the year are carried over to the following year. There is no network of healthcare providers. Hence, policyholders visit health facilities and doctors of their choice. The policyholders enjoy more covered benefits than those in managed care plans (Robinson & Ginsburg, 2009). For example, the plan accommodates the very complex genetic diagnosis tests.
My experience of selecting a managed care plan
There are many insurance companies offering healthcare products to people in the United States. Settling on one of these companies requires a lot of comparisons. I had to compare about 5 companies before I settled on one. Their terms were very confusing because they all seemed similar. I took and read their brochures in order to comprehend their terms and conditions.
I had to involve a friend of mine who has specialized in insurance brokerage. It was he who made me understand the meaning of terms that were not clear to me. These words were co-insurance, co-payment and indemnity. Finally, my friend told me that the PPO managed care plan has several advantages for employees. For example, it gives the freedom to choose healthcare providers. I settled on the PPO plan.
The advantages and disadvantages of my MCO plan
The PPO plan I have with my insurance company has advantages and disadvantages (Hurley et al., 2004). One of the advantages of the PPO plan is the freedom to visit health facilities outside the network of healthcare providers contracted by my insurance firm. This gives me the freedom to visit the facility where I believe I can receive the best treatment for a disease or condition.
The main disadvantages for PPO are the deductibles and co-insurance. I have to pay some amount of money to non-participating health facilities before the insurance firm can pay the rest. Even after I have paid the deductible, I still have to pay any remaining balance (ranging from 10% to 30% of the total cost). This cost sharing between the patient and the insurance firm might be very expensive to the policyholder (Hurley et al., 2004).
References
Baker, L. C., Bundorf, M. K., & Kessler, D. P. (2010). HMO Coverage Reduces Variations in the Use of Health Care Among Patients Under Age Sixty-Five. Health Affairs, 29(11), 2068-2074.
Hurley, R. E., Strunk, B. C., & White, J. S. (2004). The puzzling popularity of the PPO. Health Affairs, 23(2), 56-68.
Ji, L., & Liu, F. (2007). HMO versus non-HMO private managed care plans: an investigation on pre-switch consumption. Health care management science, 10(1), 67-80.
Robinson, J. C., & Ginsburg, P. B. (2009). Consumer-driven health care: promise and performance. Health Affairs, 28(2), 272-281.