Insights into managed care--operational, legal and actuarial

Understanding the operational, legal and actuarial dimensions of managed care is essential to developing managed care contracts between managed care organizations and individual health care providers or groups such as provider-sponsored organizations or independent practice associations. Operationally, it is important to understand managed care and its trends, emphasizing business issues, knowing your practice and defining acceptable levels of reimbursement and risk. Legally, there are a number of common themes or issues relevant to all managed care contracts, including primary care vs. specialist contracts, services offered, program policies and procedures, utilization review, physician reimbursement and compensation, payment schedule, terms and conditions, term and termination, continuation of care requirements, indemnification, amendment of contract and program policies, and stop-loss insurance. Actuarial issues include membership, geography, age-gender distribution, degree of health care management, local managed care utilization levels, historical utilization levels, health plan benefit design, among others.