Question

The "managed care revolution of the 1990s" achieved an important, if temporary, success. It stabilized health insurance premiums and National Health Expenditures (NHE) as a percent of GDP for 5 or 6 years. But it now appears to be failing. High and rapidly increasing health expenditures create serious problems for our society. Managed care has also faced criticism from consumers for “more managing, and not enough caring.”

What does this mean? What ae some of the pros? Cons?

Answer 1

Answer: Managed care plans are a type of health insurance. They have contracts with health care providers and medical facilities to provide care for members at reduced costs. employers could take health insurance premiums out of what would have been wage increases, with premiums so large and rising so fast, they couldn't take them out of wages without actually cutting wages which would have led to great conflict and dissatisfaction.

Some employers offered their employees a wide range of choice combined with a defined contribution that left employees with economic responsibility for premium differences. Some of the largest employers offered multiple choice of plan, but most employers didn't.

State governments only reimburse managed care plans up to a limit, so plans absorb financial losses if their healthcare costs exceed the government limit. ... Therefore, plans have an incentive to reduce either the average cost per visit and/or the number of visits to reduce their total healthcare costs.