Managed Care Flashcards
(45 cards)
Traditional fee for service health insurance is also referred to as what?
indemnity insurance
What does indemnity/conventional plans allow for?
The insured to obtain health care services anywhere and from any physician or hospital
Are indemnity (FFS) plans expensive for employers?
Yes, the most expensive
What does the patient typically pay for in a traditional indemnity plan?
10-20% of what the provider billed plus their deductible
What are the 3 main types of managed care arrangements?
- HMO
- PPO
- POS
What does PPO stand for?
Preferred Provider Organization
Describe how a PPO works
The PPO establishes contracts with a select group of physicians and hospitals that are “preferred”. The PPOs make discounted fee arrangements with providers and cost sharing tends to be higher for out-of-network providers
PPOs make what kind of fee arrangements with providers?
discounted fee for service (DFFS)
PPOs introduced the utilization review. What is this?
The process of evaluating the appropriateness of services provided through retrospective review of documentation
PPOs have _____ premiums than traditional indemnity plans, however they are ____ expensive than HMOs
lower
more
PPOs provide a 20-50% discount from providers, what is then done with this money ideally?
It is passed along to the employers via lower premiums
Why didn’t PPOs result in lower premiums?
- Providers increased their prices
- Providers saw more patients (increased demand)
- Providers did more procedures (increased volume)
Describe how the old PPOs worked
The PPO paid 80-90% of the discounted rate after the deductible was met. And the patient paid 10-20% of what provider billed.
Describe how PPOs work now
The patient pays their copay and the co-insurance on the allowable amount. The PPO then pays what is left to meet the allowable after the deductible is met.
What does HMO stand for?
Health Maintenance Organization
Describe how a HMO works
The enrollee is required to choose a PCP that delivers services in accordance with the gatekeeping model
Are PPO or HMO provider networks smaller and more restricted?
HMO
How are providers paid under a HMO?
capitation
True or False
Part of the capitation the provider receives can be withheld. Explain why or why not.
True
Part of the PMPM (per member per month) payment can be withheld depending on the achievement of goals
What happens to the withholdings if goals are not met?
The HMO keeps the money
What does the patient pay in a HMO?
copays before services are provided
What is the significance of paying the copay up front?
It is their way of trying to deter patients from receiving care since the payment occurs on the front end
Are HMOs popular with employers or insurers? Explain why…
BOTH
Popular with employers because of reduced premium growth
Popular with insures due to reduced growth in healthcare expenditures
Explain why HMOs are both loved and hated by consumers
- Loved because of low premium and OOP expenses
- Hated because they restricted/denied access to specialists
