Case Study: Managed Care

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Question 1 Insurance is a periodic payment of an individual to a company; the company receives payment but promises to compensate a specific potential future loss on the part of the individual. A car owner may pay a specific amount for his car insurance; the insurance company will then shoulder all the expenses for repair in case the car was damaged by an accident. Insurance also works in a healthcare setting. The individual pays periodically (called premiums) and the healthcare insurance company will then shoulder the hospitalization of the individual in case he gets sick (Landon, 2004). The specific future loss is the money paid by the individual to the hospital or healthcare organization while he was sick and the promise compensation…show more content…
A physician received a specific payment for every service he rendered to his patient. The patient pays the doctor a specific fee every time he visits the clinic. This is fee for service payment model. Fee for service is sometimes handled by a third party called insurance provider. The patient pay the doctor every visit, he then collects the document and present them to the third party (the insurance provider) for reimbursement. Managed care is a term used to describe a variety of techniques that aim to reduce the cost and directs the utilization of health benefits. Shortell (2005) defined manage care as any attempt to provide members health care services at the lowest possible cost. This principle aims to limit health care expenditures. Managed care provides patients with several options. These options include managed fee-for-service indemnity insurance; a preferred provider organization (PPO) option; or access to all providers. Providers were paid based on fee-for-service, and enrollees have the financial incentive (pay a lower premium) to use the PPO providers or out of the network providers. In this sense, if fee for service is handled by a third party, it can be considered as managed…show more content…
The business philosophy today is to provide work-life balance to every employee. This is based on the belief that employee perform well and stay on the job for long if they have a health and balance life. Employees now provide special benefits to employees such paid time offs, which are not part of the Family and Medical leave. Employees are now given paid leaves to take care of sick relatives and birthday leaves to celebrate their birthday or the birthday of the love ones. The changes in the business environment and societal values actually provide positive impacts to legally required benefits. They become more viable and accessible. Companies are willing to provide additional
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