The term managed care or managed healthcare is used in the United States to describe a group of activities intended to reduce the cost of providing health care and providing American health insurance while improving the quality of that care. It has become the predominant system of delivering and receiving American health care since its implementation in the early 1980s, and has been largely unaffected by the Affordable Care Act of 2010.
...intended to reduce unnecessary health care costs through a variety of mechanisms, including: economic incentives for physicians and patients to select less costly forms of care; programs for reviewing the medical necessity of specific services; increased beneficiary cost sharing; controls on inpatient admissions and lengths of stay; the establishment of cost-sharing incentives for outpatient surgery; selective contracting with health care providers; and the intensive management of high-cost health care cases. The programs may be provided in a variety of settings, such as Health Maintenance Organizations and Preferred Provider Organizations.
Mass General Brigham (MGB) (formerly Partners HealthCare) is a not-for-profit, integrated health care system that engages in medical research, teaching, and patient care. It is the largest hospital-based research enterprise in the United States, with annual funding of more than $2 billion. The system's annual revenue was nearly $18 billion in 2022. It is also an educational institution, founded by Brigham and Women's Hospital and Massachusetts General Hospital. The system provides clinical care through two academic hospitals, three specialty hospitals, seven community hospitals, home care services, a health insurance plan, and a robust network of specialty practices, urgent care facilities, and outpatient clinics/surgical centers. It is the largest private employer in Massachusetts. In 2023, the system reported that from 2017–2021 its overall economic impact was $53.4 billion – more than the annual state budget.
Blue Cross Blue Shield Association, also known as BCBS, BCBSA, or The Blues, is a United States–based federation with 33 independent and locally operated BCBSA companies that provide health insurance to more than 115 million people in the U.S. as of 2022.
The Massachusetts health care reform, commonly referred to as Romneycare, was a healthcare reform law passed in 2006 and signed into law by Governor Mitt Romney with the aim of providing health insurance to nearly all of the residents of the Commonwealth of Massachusetts.
Cambia Health Solutions is a nonprofit health care company based in Portland, Oregon. It is the parent company of Regence, a member of the Blue Cross Blue Shield Association operating in Oregon, Idaho, Utah, and Washington; Asuris Northwest Health; BridgeSpan Health; and LifeMap.
Fee-for-service (FFS) is a payment model where services are unbundled and paid for separately.
Utilization management (UM) or utilization review is the use of managed care techniques such as prior authorization that allow payers, particularly health insurance companies, to manage the cost of health care benefits by assessing its medical appropriateness before it is provided, by using evidence-based criteria or guidelines.
Samuel Osiah Thier was professor of Medicine and Health Care Policy at Harvard University. He earned his medical degree at the State University of New York Upstate Medical University in 1960. He previously served as the president of Brandeis University from 1991–1994 and the president of the Massachusetts General Hospital from 1994-96.
Capitation is a payment arrangement for health care service providers. It pays a set amount for each enrolled person assigned to them, per period of time, whether or not that person seeks care. The amount of remuneration is based on the average expected health care utilization of that patient, with payment for patients generally varying by age and health status.
Cost-shifting is an economic situation where one individual, group, or government underpays for a service, resulting in another individual, group, or government overpaying for a service. It can occur when one group pays a smaller share of costs than before, resulting in another group paying a larger share of costs than before. Some commentators on health policy in the United States believe the former currently happens in Medicare and Medicaid as they underpay for services resulting in private insurers overpaying. Although the term cost shift is used in the field of healthcare these days and there are many studies about it, other fields have more or less used it. For example, its origins go back to the environmental economy where cost-shifting referred to the practice where corporations pass the harmful consequences and negative externalities of economic production to third parties and communities whether those that are part of the production circuit or are in some way beneficiaries or those that are outside this circle, K.W. Kapp, is one who coined the concept. This concept is also used in the American legal system, especially since the cost of electronic discovery has increased dramatically due to a large amount of raw information and the urgent need to extract relevant data, its processing, and analysis. In the past, each of the plaintiffs and defendants had to bear the cost, but later many of those who prepared the summons demanded the transfer of the cost because they thought they would have to pay for something they did not do. In this regard, some courts have agreed to shift part of the costs to the complainant.
Bundled payment is the reimbursement of health care providers "on the basis of expected costs for clinically-defined episodes of care." It has been described as "a middle ground" between fee-for-service reimbursement and capitation, given that risk is shared between payer and provider. Bundled payments have been proposed in the health care reform debate in the United States as a strategy for reducing health care costs, especially during the Obama administration (2009–2016). Commercial payers have shown interest in bundled payments in order to reduce costs. In 2012, it was estimated that approximately one-third of the United States healthcare reimbursement used bundled methodology.
An accountable care organization (ACO) is a healthcare organization that ties provider reimbursements to quality metrics and reductions in the cost of care. ACOs in the United States are formed from a group of coordinated health-care practitioners. They use alternative payment models, normally, capitation. The organization is accountable to patients and third-party payers for the quality, appropriateness and efficiency of the health care provided. According to the Centers for Medicare and Medicaid Services, an ACO is "an organization of health care practitioners that agrees to be accountable for the quality, cost, and overall care of Medicare beneficiaries who are enrolled in the traditional fee-for-service program who are assigned to it".
Elevance Health, Inc. is an American for-profit health insurance provider. Prior to June 2022, Elevance Health was named Anthem, Inc. The company's services include medical, pharmaceutical, dental, behavioral health, long-term care, and disability plans through affiliated companies such as Anthem Blue Cross and Blue Shield, Anthem Blue Cross in California, Wellpoint, and Carelon. It is the largest for-profit managed health care company in the Blue Cross Blue Shield Association. As of 2022, the company had 46.8 million members within its affiliated companies' health plans.
Steward Health Care is a large private for-profit health system headquartered in Dallas, Texas. It utilizes an integrated care model to deliver healthcare across its hospitals and primary care locations, as well as through its managed care and health insurance services. At the start of 2024, Steward operated 33 hospitals and employed 33,000 people in the United States, however that number has decreased significantly due to the company's May 2024 bankruptcy filing. Steward's international ventures include Steward Colombia, which operates four hospitals, and Steward Middle East, which operates in Saudi Arabia and the United Arab Emirates.
Cleve L. Killingsworth is a former CEO of Blue Cross Blue Shield of Massachusetts. There, he was dissatisfied with the results of pay for performance initiatives, in that he thought billions more of wasteful medical spending could be reduced with a new payment model. In 2007, he set a 6-month deadline for his staff to come up with a new payment model, which was introduced as the alternative quality contract (AQC) to health care providers.
Atrius Health is a Massachusetts based healthcare organization with a system of connected care for adult and pediatric patients in eastern and central Massachusetts. Atrius Health's medical practices work together with the home health and hospice services of its VNA Care subsidiary and in collaboration with hospital partners, community specialists and skilled nursing facilities. Atrius was acquired by Optum on May 31, 2022, which caused it to lose its tax-exempt status, although its charitable assets were transferred to the Atrius Health Equity Foundation.
Balance billing, sometimes called surprise billing, is a medical bill from a healthcare provider billing a patient for the difference between the total cost of services being charged and the amount the insurance pays. It is a pervasive practice in the United States with providers who are out of network, and therefore not subject to the rates or terms of providers who are in-network. Balance billing has a variable prevalence by market and specialty.
Turntable Health was a direct primary care clinic in Downtown Las Vegas, Nevada. It began as part of Zappos CEO Tony Hsieh’s $350 million economic revitalization project in Downtown Las Vegas. The clinic was founded by Zubin Damania, known by his YouTube screen name as ZDoggMD, who Hsieh recruited from the Bay Area in 2012. The clinic was made in partnership with and in substantial part modeled on Iora Health, an innovative primary care chain led by Rushika Fernandopulle.
The Oncology Care Model (OCM) is an episode-based payment system developed by the Center for Medicare and Medicaid Innovation. The multipayer model is designed for discrete instances of care, especially those involving chemotherapy, which triggers the six-month episode. The program combines fee-for-service (FFS) payments for established services, monthly payments for additional care under a structured guideline, and performance-based payments weighed against quality metrics and benchmarks.
How healthcare payment is managed is one of key policies that countries have to drive healthcare system. Payment for healthcare is managed in various ways. The main categories of payment systems are salary, capitation, bundled payment, global budget and fee-for-service. Most countries have mixed systems of physician payment.
