What is Managed Health Care?

For many people the term managed health care gives an ominous feeling of a company that determines what services they will receive. This however, is a misconceived idea, as they do not truly understand what this term means. Basically the idea of managed health care is to provide people with the healthcare they need at a price that they can afford by managing the prices that they have to pay. It is simply a glorified term for the type of health insurance that a person has. There are three basic types and understanding what they are can answer the question what is managed health care.

One of the most common forms of managed health care is Health Maintenance Organizations (HMO). An HMO is set up by the company forming alliances with contracts with certain health care providers, which become part of their network. A  person with an HMO plan will have to see a primary physician that is within the company’s network, also called in-network that will set up the way in which the person’s health care will be managed. If they need to see a specialist for anything, they will need a referral from their physician in order to do so. This plan is good in the aspect of as long as a person stays within the company’s network there is low or no cost for health care visits, though many times they do not cover visits to providers that are not within their network.

Another form of managed care is a Preferred Provider Organizations (PPO). This is set up similar to an HMO where there are in-network providers and out of network providers, though the person does not have to choose a primary physician. There are higher fees for seeing a doctor that is not within a company’s network and can add up fast. The out of pocket expense with this form of managed care tends to be higher than with an HMO.

The third form of managed care is Point- of- Service Plans (POS). This is becoming quite popular because this is a combination of both HMO and PPO plans. Every time a person with this plan goes for a health care visit, they get to choose whether they want to use an HMO or PPO. They do not have to choose a primary physician, though there are benefits for having one and getting referrals through them. If you choose to go out of their network, you will still be covered, though this will probably have deductibles and may only cover a certain percentage, such as with a PPO.

Once you understand what is managed health care, it is important that you do a little research. Depending on your family’s health needs, you may want to choose a certain plan. You will want to weigh the options that you have with all of the different plans available to you. It is important to understand what you are getting into before choosing a plan for your managed care, including knowing the doctors and services that are covered, as this will set the basis for how much you can pay.