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Strategies Adopted by Managed Health Care Organizations to Control Cost

1. Cost Control Strategy in Managed Care Organizations

Term managed care is used for the wide-ranging approach to the delivery of health care and managed care organizations, in this respect, are providers or group of medical service providers who are in contract with self-insured employers in order to provide wide range of managed health care service to registered employees through contributing panel providers (David, 1994, pp. 119-125).  In the beginning, managed care organizations were considered as the driving force in the health care system of United Sates but with the passage of time, managed care organizations are no more efficient in controlling the cost of health care system in the country. In couples of previous years, it is observed that the cost of health care has increased along with the rate of enrollment in the managed care (, 2011). Get assignment writing help from professionals.

Concerning this issue, managed care organizations are now more focusing on employing effective strategy that could help in controlling the rising cost. In this view, managed care organizations regard the greater use of preventive services and education for patients to cut the cost, because through developing the clinical guidelines, physicians are provided with the opportunity to abstain from costly procedure, which is less likely to improve the patients’ health (Grumbach& Bodenheimer, 1995). However, this is also known as capitation, in which managed care organizations seek to control the cost through clinical guidelines which purpose is to change the clinical management of particular health care. Other than this, under the health care plan of managed care organization, employers now prefer their employees to bear the maximum cost of health care so that less financial burden are put on them. Hire dissertaiton help online by well-versed writers.

Another significant strategy is that managed care organizations now prefer their physicians to prescribe non-branded medicine because branded medicines are rather costly and prescribing other similar non-branded medicine can help in cutting the cost (, 2011). In addition, many of costly and branded medicines are excluded from the Medicaid's preferred list of medicines to ensure lowering the cost of health care system (, 2011). Buy essay writing help in UK.

2. Positive Aspects of Cost Control Strategy

The positive aspects of above-mentioned cost controlling strategy adopted by managed care organizations can be credited with restraining the medical most in the time of recession and economic downturn by decreasing the rate of unnecessary hospitalization, persuading health care service providers to discount their rates and increasing the efficiency and quality of health care industry (David, 1994). Furthermore, the clinical guidelines as part of the strategy to adopt appropriate treatment for patient can help patients to have better understanding of illness while preventing unnecessary costly medical treatment along with persuading the medicine companies to decrease the cost of medicine (Grumbach& Bodenheimer, 1995). You can order coursework online.

3. Negative Aspects of Cost Control Strategy

The negative aspect of adopting these strategies by the managed care organizations is that they intend to control cost through ignoring medically important and necessary medical service to patients (Kongstvedt, 2009). Since most of the managed care organizations are for-profit organizations, therefore, this impression is taken that they are saving money instead of providing quality health care service. Further, the strategy regarding non-branded and exclusion of costly medicine can put threat on the life of patient, as it may affect the quality of the medical care (Kongstvedt, Essentials of managed health care, 2007). Acquire experienced thesis writing online by well-versed experts.


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