Question

How does managed competition, as conceived in the US, differ from that applied in the United Kingdom?

(300 words) No written responses.

Answer 1

Since the mid-1970s, this strategy of financial management for healthcare organizations has emerged in a context of rising costs resulting from increasing demand for services, particularly in societies where aging populations and the decline of the family have placed greater strain on existing services and institutions. Managed competition can be technically defined as a purchasing strategy by adopting microeconomic principles to maximize value for consumers and employers alike. A sponsor acting in the interests of a large number of subscribers, whether in the private or public sector, regulates the market to avoid attempts by insurers to suppress price competition.

The sponsor is attempting to create price-elastic demand through this strategy and reduce market risks. This type of financial management has been appealing to U.S. health sector employers and insurers because it provides pluralism of products while managing costs and retains individual consumer option, but also approximates universal coverage. Generic benefits must be available that can guarantee a minimum level of coverage (such as hospitalization), thereby allowing performance comparisons between plans; facilities should in principle be open to all consumers regardless of any pre-existing health condition (such as diabetes), and rates should not be disproportionately affected (such as age or gender); and competition s;

While controlled competition as a concept has existed since the 1970s, it is generally agreed that in terms of cost control, efficiency, and service delivery across society, the U.S. health care system is failing. The job-based system does not provide coverage for people whose employer does not offer health insurance or to individuals who are self-employed or unemployed but not poor. There is little motivation for companies to improve efficiency in the early twenty-first-century situation. There is, in short, no market mechanism for creating incentives for delivery systems to reduce care costs.

All developed societies ' health-care systems are subjected to similar problems of price inflation, bureaucratic inefficiencies, and rising costs arising from reliance on advanced medical technologies, aging populations with chronic disease's health-care needs, and growing customer expectations for better services. These challenges were faced by countries such as the United Kingdom and Sweden, which at the point of delivery had, at least since the end of the Second World War (1939–1945), state-sponsored, universal health care with free service provision.