Introduction:
Health Maintenance Organization Plans (HMOs for short) are a type of managed care program. The idea behind managed care programs is that you will maintain good health by preventing illness and providing quality care. By maintaining good health, it is believed that rising health care costs can be controlled.
When HMO plans were first introduced, members paid a fixed, prepaid monthly premium in exchange for medical care from a network of contracted providers. The contracted provider network includes hospitals, clinics, and health care providers that have contracted with the HMO. In this sense, HMOs are the most restrictive form of managed care plans because they restrict procedures, providers, and benefits by requiring members to use these providers and not others.
History:
HMOs were meant to take healthcare in a new direction. They were designed by the government to eliminate individual health insurance plans and make affordable health insurance available to everyone. At the time, employers were buying individual health insurance plans for their employees, a costly expense that many were beginning to waive.
The Health Maintenance Organization (HMO) Act was passed by President Nixon in 1973. Managed health care plans were subsidized by the government and new HMO-like systems began to grow, usually organized by willing businesses and community groups. that medical care was available. to its workers and members at costs they could better afford. This grant created insurance company deals to entice these companies to buy these new low-cost, discounted health plans for their employees in lieu of the expensive individual health plans.
Feeling the power of the government behind them and the frantic desire of employers to enroll their employees in these new HMO plans, insurance companies began to pressure doctors to join an HMO. The doctors were told that if they did not join, the insurance company would find doctors who would join and who would effectively take all of their patients. Therefore, physicians ended up joining an HMO so as not to lose their patients and subsequently their entire practice.
Over time, insurance companies added more and more rules each time the doctor’s contract was renewed. The popularity of HMO plans meant that most of his patients had HMO plans, so they accepted the new conditions. The new terms included seeing more patients, stricter confidentiality agreements, and more services that require prior approvals.
Until the 1980s, most members agreed that HMOs were an excellent health plan. However, by the end of that decade, in the face of a growing number of denied claims, members began to resent the HMO plans.
What led to the increase in denied claims? It was not the result of the claims themselves; it was the result of bad investments by insurance companies.
During the real estate boom, insurance companies thought it would be a good idea to invest in real estate businesses. Unfortunately, when the savings and loan industry collapsed along with real estate values, insurance companies began to lose money. These losses caused them to fall short of covering the claims of their HMO members.
Thus began the practice of denying claims from members of the HMO Plan. The insurance companies denied the claims on the grounds that they were too expensive or medically unnecessary. At the time, the members and their doctors did not fight these denials and because the insurance company got away with the denied claim process so well, they continued to do so as part of their operating procedure.
However, a new concept has emerged in recent years: the HMO Act.
Now there are attorneys and law firms dedicated to filing cases against HMOs. These claims include wrongful death, bad faith, and medical malpractice. This means that an HMO can be sued when a person dies as a result of the HMO denying them coverage for necessary medical treatment; for the denial of valid claims; and for medical malpractice on the part of one of your doctors.
Additionally, individual states are tightening their governing laws. HMO plans.
In future articles we will discuss how the HMO works, the types of HMO plans, the cost of the plans, and the future of the plans.
