Health Care Insurance polcies have been forced to take action to contain expenses  of quality medical delivery as medical expenses  have skyrocketed. Health Care Insurance premiums, deductibles and co-pays have steadily increased, and medical insurance corporations have implemented certain strategies for reducing medical expenses . “Managed care” describes a group of stratgies aimed at reducing the expenses  of medical for medical insurance corporations.

There are two basic types of managed care plans; health maintenance organizations, or HMOs, and preferred provider organizations, or PPOs. So which health plan is best? How do you choose what kind of medical insurance best suits the medical needs of you and your family?

Both HMOs and PPOs contain expenses  by contracting with health providers for reduced rate on medical services for its’ members, often as much as 60 percent. One vital difference between HMOs and PPOs is that PPOs often will cover the expenses  of care when the provider is out of their network, but usually at a reduced rate. On the other hand, most HMOs offer no coverage for medical services for out-of-network providers.

Both Health Maintenance Organization and PPOs also control medical expenses  by use of a gateway, or primary care provider (PCP). Health Care Insurance policy members are assigned (or select) a primary care practitioner (physician, physician assistant, or nurse practitioner). usually a family practitioner or internal medicine physician for adult members or a pediatrician or family care practitioner for childern. The primary care provider is responsible for coordianting health delivery for plan members. Care by specialist medical providers require referral from the primary care provider. This price containment strategy is intended to avoid duplication of services (for example, the cardiologist ordering tests that have already been done by the PCP, or a sprained ankle being referred to an orthopedic) and avoid unnecessary specialist referrals, tests and/or procedures.

Health Maintenance Organization and PPO plans also contain expenses  by requiring prior approval, prior authorization, or pre-certification for numerous elective hospital admissions, surgeries, costly tests and imaging procedures, durable medical equipment and prescription drugs. When such services are required, the provider must submit a request to the medical insurance policy review department, along with medical records that justify the service. The request is reviewed by the medical insurance corporation to determinewhether the services are justified as “medically necessary” according to the health plan policy and guidelines. Review is usually performed by licensed nurses, and, if the reviewer agrees that the service is necessary, approval is given and the service will be covered by the medical insurance plan.

As medical expenses  continue to rise, numerous indemnity medical insurance polcies, or “fee for service” plans are being forced to adopt some managed care strategies in order to provide quality medical and keep medical insurance premiums affordable. And as long as medical expenses  continue to rise, the distinctions among PPO, Health Maintenance Organization, FFS and other medical insurance polcies will become blurred. Rest assured, however, that managed medical is here to stay