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Summary
Health maintenance organizations (HMOs) faced losses for two years. In 1989, 70% of HMOs operating managed-care systems reported profitability, indicating a significant financial recovery.
Area of Science:
- Healthcare Management
- Health Economics
Background:
- Two-thirds of health maintenance organizations (HMOs) experienced financial losses for two consecutive years.
- The healthcare industry has faced significant financial challenges in managed-care systems.
Purpose of the Study:
- To assess the financial performance of health maintenance organizations (HMOs) in 1989.
- To identify trends in the profitability of managed-care systems.
Main Methods:
- Analysis of financial data from healthcare organizations operating managed-care systems.
- Survey of health maintenance organizations (HMOs) regarding their profitability in 1989.
Main Results:
- In 1989, a notable shift occurred with 70% of healthcare organizations reporting profitable HMOs.
- This contrasts sharply with the previous two years where two-thirds of HMOs incurred losses.
Conclusions:
- The year 1989 marked a period of renewed financial vigor for health maintenance organizations.
- Managed-care systems demonstrated improved profitability, suggesting a positive turnaround in the sector.