When responding to your classmates, analyze their rationale and constructively critique the viability of their recommendations. Based on their support and explanation, would you follow their recommendation? 

Post # 1

Providing high quality healthcare to patients should be the goal of every healthcare. At the same time, in order to provide quality healthcare, an organization needs to be able to sustain themselves financially. According to Casto (2018), the objective of managed care is to “provide affordable, high quality healthcare.” Casto (2018) further explained that managed care merges clinical, financial, and administrative processes in order to manage, access, cost and quality of healthcare. There are many disadvantages as well as there are advantages when it comes to managed care. Sekhri (2000) stated that a disadvantage of managed care is that administrators are worried about profitability. Sekhri (2000) further explained that with managed care physicians worry about reductions in compensation, unfair labor practices that can dismiss physicians if they provide services that are too expensive. Reimbursement is too low to provide adequate healthcare and providers are heavily micromanaged. 

The Medicaid and CHIP Payment and Access Commission (2020) explained that low rates may also motivate plans to pay less for services. This can potentially reduce the number of physicians in a facility. With less physicians, this turns to a lack of quality services, a lack quality services turns in to a lack of revenue. Casto (2018) stated that an advantage of managed care is stable revenue. Honestly after doing research it seemed as though the disadvantages outweighed the advantages. As an administrator a decision like this cannot be done lightly. With that being said, as an administrator I would adopt this plan. Although quality care is important and should be the focus of every organization, it is important to have stable flow of cash. According Sekhri (2000) facilities receive more than 50% of their revenue from managed care.

References:

Casto, A.B. (2018). Principles of healthcare reimbursement (6thed.). Chicago, IL: American Health Information Management Association.

MACPAC (2020). Managed care’s effect on outcome. Retrieved from: https://www.macpac.gov/subtopic/managed-cares-effect-on-outcomes/

Sekhri, N (2000).Managed care: the US experience. Retrieved from: https://www.who.int/bulletin/archives/78(6)830.pdf

Post #2

HMO’s have a contract with selected hospital system or providers which provide a discount for the recipient. These plans also aid in reducing fee-for-spending by decreasing the amount of days in the hospital (Thorpe, 2001). A hospital system will have a higher operating margin in this managed care plan when the patient spends less time admitted and with efficient services being provided. The services that are covered need to be referred by other physicians, therefore only medically necessary services will be approved for coverage. This is an advantage to the organization because it aids in controlling costs. This isn’t ideal for the patient sometimes because there isn’t much flexibility in seeing another specialist provider that isn’t referred for example.  

Covering large volumes of people are another reason the HMO is a beneficial way of managing care. Reduced costs and discounted prices are the result when a large organization offers a plan like this. There is a large network of physicians and available health services that are all covered under this plan, and if utilized correctly, most patients would benefit from the reduced rates. I support the HMO but with the contracted physicians would have to be plentiful. I would also recommend that certain specialty practices be included with our plan specifically. One of the main disadvantages of this plan is the non-flexibility and that is what I would want as a patient. Therefore I would recommend to the organization that certain services allow for flexibility and negotiating of prices. Ultimately the organization wants to have a profit margin while producing quality care. Reduced rates will not interest patients over the long-term if the care was inadequate, which will not be sustainable for the organization. Finding the sweet spot where both costs are controlled and patients are satisfied is a constant challenge that we as healthcare administrators must constantly be evaluating. 

 

 Thorpe, K. E., Seiber, E. E., & Florence, C. S. (2001). The Impact of HMOs on Hospital-Based Uncompensated Care. Journal of Health Politics, Policy & Law, 26(3), 543. https://doi-org.ezproxy.snhu.edu/10.1215/03616878-26-3-543