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Managed care in the United States

F D Scutchfield1, J Lee, D Patton

  • 1Center for Health Services Research, Policy and Management, University of Kentucky Medical Center, Lexington 40536-0003, USA.

Journal of Public Health Medicine
|November 5, 1997
PubMed
Summary
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Managed care, including Health Maintenance Organizations (HMOs), offers cost control in US healthcare through financial risk-sharing. While enrollment is rising, it may not be the ultimate solution for healthcare provision.

Area of Science:

  • Health Economics
  • Healthcare Management

Background:

  • US healthcare spending is rising as a percentage of GDP.
  • Managed care models are increasingly adopted to control costs.
  • Various managed care types exist, including PPOs, EPOs, and HMOs.

Purpose of the Study:

  • To examine the role and mechanisms of managed care in controlling healthcare costs.
  • To understand the different risk-sharing strategies employed in managed care.
  • To assess the impact of managed care on service delivery and future healthcare trends.

Main Methods:

  • Analysis of managed care financing and delivery mechanisms.
  • Description of risk-control strategies: capitation, risk pools, and withholds.
  • Review of service utilization patterns, including same-day surgery and outpatient treatment.

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Main Results:

  • Health Maintenance Organizations (HMOs) utilize prepaid premiums and provider financial risk.
  • Capitation, risk pools, and withholds are key methods for managing costs and behavior.
  • HMOs have driven innovations like same-day surgery and outpatient care, reducing hospital stays.

Conclusions:

  • Managed care, particularly HMOs, is a significant trend for controlling US healthcare expenditures.
  • Government programs like Medicare and Medicaid are increasingly offering managed care options.
  • Despite its growth, managed care is not presented as a definitive, final solution for US healthcare challenges.