Managed Care Pros and Cons

Managed Care Pros and Cons

DeVry University

December 14, 2013

There has been a lot of controversy about managed care some are for it while others are against it. Managed care has been around since 1929, when a physician from Oklahoma named Michael Shadid established a health cooperative for farmers in a small community without medical specialists or a nearby general hospital. He sold shares to raise funds to build local hospitals and he also created an annual fee schedule to cover the costs of providing care. By 1934 600 family memberships were supporting a staff which included Dr. Shadid plus four newly recruited dentist. Then by 1970 managed care was introduced to the public as Health Maintenance Organizations also known as HMOs. The enactment of the HMO Act of 1973 provided a major impetus to the expansion of managed health care. This legislation was proposed by the Nixon Administration in the attempt to restrain the growth of healthcare costs and also to preempt efforts by congressional Democrats to enact a universal health care plan.

Managed care is defined as a system of health care in which one agrees to visit only certain doctors and hospitals, and in which the cost of treatment is monitored by managing company. With that being said I will be discussing the pros and cons of managed care this will include some discussion of HMOs and burdens that doctors and patients may face. Who benefits from managed care and who doesn’t.

Pros and Cons of Managed Care

Some of the pros for managed care are; Preventive care: HMOs pay for programs, they are set up and are intended at keeping one healthy (yearly checkups, gym memberships, etc.)The idea is, so they won't have to pay for more costly services when and if one gets sick. Lower premiums: because there are limits set as to which doctor’s one can see and when one can see them, HMOs charge a premium and usually they are lower premiums. Prescriptions: as part of their precautionary retreat, most...