Managed Care Research Paper

The Effects of Regulations on Managed Care and IDS

Managed Care is a health care delivery system organized to manage cost. The legal and business imperatives of managed care pervade our national healthcare system, the regulation of managed care depends on who contributes to the plan and who bears the risk for paying for the insured services. More than 170 million Americans receive health care coverage or benefits through some type of "managed care" setting.1 By 2007 about 20 percent of these services are directly provided by a health maintenance organization (HMO), while the majority are served through other managed arrangements, 60 percent in Preferred Provider Organizations (PPO) and 13 percent in Point of Service (POS) plans. Beginning

The laws that significantly affect MCOs are discussed in more detail later in this chapter. Health plans are carried out by a number of different federal agencies. These agencies are responsible for developing regulations to implement the federal laws. The Department of Health and Human Services has primary responsibility for federal laws affecting managed car, including HIPPA and the ACA. Federal laws that regulate the operations of MCOs. These laws directly govern payers or regulate the employers that contract with payers to administer their benefits plan and the health care providers that provide services to the organization. The federal requirements affect almost all aspects of managed care and payer operations including standards for how insurance coverage must be provided to individuals and employers, provisions affecting health benefits and group health plans, tax preferences for individual and group health coverage, and protections for health information. Many of the consumer protections already passed at the state level are now being debated at the federal level. Congress has shown its willingness to intervene in the area of quality health care by passing the Health Insurance Portability and Accountability Act of 1996 (HIPAA)

the states regulate the business of insurance, which includes the MCO (such as a health maintenance organization (HMO)) that offers a managed care policy to an individual, employer, or other purchaser. If a private sector employer sponsors a plan that is not purchased from an MCO (i.e., the plan is self-insured), The details and the extent of these state laws vary considerably, but they remain in force as a mechanism for regulating HMOs and other forms of managed care organizations. A number of states require managed care plans to provide current and new enrollees the opportunity to continue to receive care and services for a period of time with a provider that has been terminated or dis-enrolled from the plan. Many states call for health plans to institute procedures that provide an enrollee that requires specialized medical care over a prolonged period of time to receive a standing referral to a specialist. Many state laws specify automatic coverage for emergency medical conditions "of sufficient severity, including severe pain, that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of medical attention to result in placing the person’s health in