Managed Care Plan

A Managed Care Plan is a plan that is designed to manage how healthcare is delivered to a patient in an effort to control costs.

This is accomplished in a lot of different ways, including:

  • Primary care providers
  • Referrals
  • Preapprovals
  • Copays
  • Coinsurance
  • deductibles
  • In network providers
  • No out of network coverage

For Patients

Managed care plans provide patients access to a wide network of providers at lower out of pocket costs. This makes a managed care plan ideal. Especially for patients/families that are healthy or have controlled conditions that only require the lowest levels of care.

For patients with complex health issues, gaining access to alternative or specialized levels of care may be a slow process. You may have to wait to exhaust some lower levels of care first or the plan may have a referral and authorization requirement that delays care.

Most plans today are written as managed care plans, but the attractiveness of the lower out of pocket cost should be weighed against the inability to access any provider that you want unless you are willing to pay more out of pocket. 

Real World Example

For the last few years, someone I know has suffered from a host of uncomfortable, though not life threating, illnesses i.e. stomach issues, rashes, itching, etc. I believe her Primary Care Physician described them as “nuisance issues.” Because she had an HMO plan, she was required to stay in the network. In spite of the numerous visits and prescriptions, she only experienced temporary relief.

She decided to pay out of her own pocket to see a holistic specialist that she was recommended to. The cost for the visit and extensive lab work was pricey but she discovered that her condition was related to food allergies.

She swears she is 100% better and even swapped out her HMO plan so that she could at least have some out of network coverage.

This example illustrates what some say is wrong with some managed care plans. Because no one can predict health, having the freedom to go outside of the circle without having to pay an arm and two legs for it - is important; especially for situations of repeat visits with no improvement. 

For Providers

The appeal of managed care contracts is evident - an increase in patients results in a steady stream of income. Besides, what doctor today can afford to opt out of all of the managed care plans? Participation has become almost mandatory. Providers that sign managed care contracts just need to fully understand what it may mean to their practice. 

The payment methodology should be clear. Will you have upfront access to the reimbursement amounts for your most common procedures so you can determine loss or gain? Can you appeal payments with an outside reviewer? Will claims be paid promptly?

My thoughts

You can choose to participate with every health carrier nationwide, but if you are not managing your operation it is not going to give you the result you are looking for which is an increase in revenue. Here are some musts before signing on the dotted line with any carrier:

  • Thoroughly review all contracts before you sign.
  • Keep your eye on all claim’s payments to make sure that you are being reimbursed as expected.
  • Make sure you appeal or dispute every claim that is paid incorrectly.
  • Review all contracts periodically to make sure they are really worth it.
  • If the talent needed to recover every dime that is due does not exist in your practice - outsource.

There is nothing worse than getting stuck with low reimbursement with little or no chance to renegotiate the contract in exchange for a few new patients. 

Please note that this article reflects my opinions and experiences only. Use this as yet another source of information.

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