Question

Although MCOs are responsible for contracting with providers to deliver services to their members, MCOs have various networks they offer to their employer group customers to achieve different goals, like local/national networks, cost control, limited/expansive access... There are costs associated with each of these options, whether a higher or lower cost. If you are working for an employer in making the health care purchasing decisions:

• What options do employers have for compensating providers?
• What role does reinsurance play in provider reimbursement?
• What limitations exist (e.g., state or federal laws)?
• Provide examples to support your ideas.

Answer 1

1. An employer can compensate providers through fixed compensation, stock options or daily compensation. Having options favors employers because it allows more than one method of compensation which can be provided to both the independent contractors as well as contacted employees.

2. The role of reinsurance is allowing a reduction in the employee's premium when the employer contributes to it. With this, employee gets the best possible treatment and it makes the employee feel he/she is taken care of.

3.While claiming the reimbursement, there is a limitation on the time period avilable before a provider can no longer file a claim for the services provided. In addition to filling a claim in a timely manner, a managed care organisation must also follow any federal and state plan requirements. Payments must be consistent with the economy, quality of care as well as being effecient

4. For example, please refer to Longstreet, P.R of what they are and how they work