INSIDE THE HEALTH-CARE SYSTEM – HOW TO GET THE MOST FROM YOUR HMO (INTRODUCTION)

If you’re not already enrolled in a health maintenance organization (HMO) or other managed-care plan, you may be soon. Three-quarters of American workers are enrolled in some form of managed care (HMO, PPO, POS) plan.

The number in traditional fee-for-service insurance is decreasing every year, and even these plans increasingly incorporate managed care features.

The rules are very different in this new system. To get good care, you must understand how managed care works and adjust your approach accordingly.

The first thing to understand is how the financial incentives for doctors have changed. Under the fee-for-service system, insurance companies paid doctors for every service rendered. Each time doctors stuck in a needle, ran a cardiogram or took out someone’s tonsils, they were paid.

Unfortunately, doctors responded to this arrangement by doing millions of needless tonsillectomies and other procedures.

As a result, medical costs skyrocketed, with health care consuming a larger and larger chunk of the GNP.

HMOs came along and changed the way doctors are paid. Although they use dozens of different systems, the bottom line in many plans is this—the less the doctor does, the more money he or she makes.

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