Understanding Managed Care

Posted by mgsionline on October 3rd, 2013

The US healthcare industry’s financial viability has witnessed significant changes with the onset of Managed Care. A broad spectrum of varied plans is used under Managed Care to reduce rising medical costs while enhancing the quality of patient care services. To accomplish this goal, several initiatives such as HMOs, PPOs and POS came into existence. Let’s take a look into these Managed Care initiatives:  

Health Maintenance Organizations (HMOs): They were created as an upshot of the Health Maintenance Organization Act of 1973. In general, HMOs build a huge network of medical care by contracting with a wide range of Providers and Healthcare Facilities. Since the Premium is less in HMOs, patients who cannot afford normal indemnity plans will find HMOs highly valuable. HMOs are financed through federal development funds and have a huge market penetration.  Every member is assigned a primary care physician (PCP) who needs to authorize referral to a specialist or non-emergency hospital admissions. The best part about these Managed Care units is that they pay for emergency room treatment even without a referral.

Preferred Provider Organizations (PPOs): These Managed Care units offer a certain level of flexibility to patients that traditional HMOs don’t offer. A PPO plan not only allows a person to use the services of out-of-network providers but also offers medical coverage to the entire family. There is no copy, but only Deductible and Co-insurance.  Since the member bears additional expenses in the Deductible and Co-insurance, it is considered as the least expensive of all Managed Care healthcare plans. Patients can enjoy substantial discounts from providers who are within the network.

Point of Service (POS): This Managed Care plan is derived from the combination of HMO and PPO plans. Like how HMOs allow patients to choose a primary care physician, POS also allows choosing a preferred in-network provider. The patient also has the freedom of choosing an out-of-network provider but will be expected to bear most of the expenses. However, the POS plan covers all or most of the expenses, if the patient is referred to an out-of-network physician by the primary care physician (PCP). Like the other two Managed Care plans, POS also aims at reducing healthcare costs while offering patients numerous choices. 

Whether Healthcare Providers and Facilities prefer to join a HMO, PPO or POS network, they require a lot of time and man power to get adapted to the new techniques and code sets for performing medical claims billing functions without a hindrance. Therefore, in order to keep the provider billing processes running smooth and avoid inflated medical AR, Healthcare Providers and Facilities must choose to outsource medical billing. A renowned medical billing company like MGSI can take care of the provider billing functions while physician practices adapt to the new Managed Care plan.   

About MGSI:

Based in Florida, MGSI is a reputed US medical billing company that has been providing hassle-free medical billing services to its clients. With more than 20 years of experience in the healthcare industry, this reputed company will solve any medical claims billing problem that a provider faces. For more details, log on to http://www.mgsionline.com


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Joined: July 6th, 2012
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