Managed Care: Origins, Current State, etc.


Managed care is one of the primary health care systems adopted by the U.S. government to control the provision of health care to its citizens, through specific healthcare organizations and medical practitioners (Tobin, 1997, p.1). The system manages the funding and delivery of required healthcare services to individuals who have subscribed to particular healthcare plans. The primary aim of this system is to ensure that, all healthcare givers offer quality health care services to their clients, in a cost-effective and controlled environment. In addition, this system is in place to ensure that, not only do the health care providers offer required healthcare services to their clients but also such healthcare providers obey the set healthcare standards as specified by the federal government (National Committee for Quality Assurance: NCQA, 2010, p.1).

Within the U.S., there exist three main categories of managed healthcare schemes namely: Point of Service (POS), Health Maintenance Organization (HMO), and Preferred Provider Organization (PPO) plans. Although all these forms of plans have one primary goal, delivery of quality healthcare services, their provisions and conditions vary in terms of service vary. For example, PPOs and POSs guarantee their clients reimbursement of funds used in seeking medical services out of the set zones, a case that is contrary to HMO plans. Another primary difference between these schemes is that individuals with the POS scheme can seek outside special treatment without consulting their insurance companies, a case that is different from PPO because consultation with the one’s insurance company is compulsory in “special” health complications. Contrary to this two, the case is very different in HMO plans, because the scheme denies its client’s such rights (New York Health Plan Association, (n.d), p.1).

Origins of Managed Care

The system of managed care has been in place since time memorial, although it has undergone numerous changes in its form, because of the many economic, social, and political transformations the American continent has gone through. Before the Second World War, U.S. citizens paid medical practitioners directly for any services offered. This never lasted for long with the emergence of government health plans, for example, Medicaid and Medicare in the 1960s. Implementation of the federal government’s Health Maintenance Organization act of 1973 brought a transformation in the health sector, as it marked the emergence of many HMOs. Because of the increased numbers of citizens in need of a medical cover, a factor promoted by the increase in the numbers of individuals in need of a medical cover, more HMOs emerged, which eventually gave rise to the present-day healthcare insurance firms (Kongstvedt, 2001, pp. 4-9).

Current State of Managed Care in the U.S. Health Care System

Presently, although the federal government offers some public and social insurance covers to its citizenry, a greater portion of the American citizenry depends on private companies for health insurance cover in form of managed care (Scutchfield, Lee, & Patton, 1997, pp. 251-254). Although previously most individuals were discontent with the functioning of these private companies, because they believed that the government was reducing health costs at the expense of its citizens’ health, presently most individuals praise this initiative, because it has enhanced healthcare delivery (Tietz, 2003, pp. 311-319 and Scandlen, 2005, p.1).

Potential Impacts of Health Care Reform Initiatives on Managed Care

To improve efficiency in delivery and provision of insurance coverage to all American citizens, the Obama government brought the health care reform agenda, which is presently a healthcare law. The primary goal of this reform is to ensure the entire American citizenry, regardless of class, has health insurance coverage. In addition, the enactment of the bill is a primary mechanism of ensuring all American citizens receive reasonably, cost-saving, and sustainable healthcare cover. Because the legislation is likely to control the funding and control of managed care plans, this reform is likely to benefit citizens at the expense of the insurance companies. That is, the reform is a positive incentive to Managed Care Organizations (MCOs), although most of them are likely to lose the control they had over their client’s rescissions, lifetime caps, and control over the nature of diseases they cover (BloomBerg, 2010, p.1).


In conclusion, for the government to ensure managed care meets all U.S. citizens’ health needs, there is a need for the government to always make sure any formulated health policy addresses concepts of equity, cost-effectiveness, and quality health care delivery to the entire American citizenry, for it is the only way it will help to protect the rights of Americans.

Reference List

Bloomberg. Experts talk healthcare reform bill impact. Bloomberg Business Week. Web.

Kongstvedt, P. R. (2001). The managed health care handbook. (4th e.d). Maryland: Aspen Publishers. Web.

National Committee for Quality Assurance. (2007). Managed care Organizations, accreditation MCO. Web.

New York Health Plan Association. Managed care vs. FFS Chart. New York HPA. Web.

Scandlen, G. (2005). Consumer-driven health care: just a tweak of a revolution? Health Affairs (Millwood) 24(6), 1554-1558. Web.

Scutchfield, D. F., Lee, J., & Patton, D. (1997). Managed care in the United States. Journal of Public Health, 19(3), 251-154. Web.

Tietze, M. F. (2003). Impact of managed care on health delivery practices: the Perception of health administrators and clinical practitioners. Journal Of Healthcare management, 48 (5), 311-321. Web.

Tobin, C. (1997). What is managed health care? Web.

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