How does managed care work?

What is managed care contracting?

Managed care contracting are contracts which attempt to restrain healthcare costs by controlling both the quality and the type of services provided. The level of service and cost are both considered with managed care contracting. There are three basic types of managed care health insurance plans: (1) HMOs, (2) POS plans, and (3) PPOs.

How does managed care work?

By forming custom arrangements with specific hospitals, health-care providers and physicians managed care allows providers to serve patients at a contracted reduced rate. Typically managed care plans require less paperwork and offer a lower premium.

What is the purpose of managed care?

The purpose for managed care plans is to reduce the cost of health care services by stimulating competition and streamlining administration. One application of managed care is the medicare managed care plan, an arrangement between managed care organizations(MCOs) and a state Medicaid agency.