HMO Healthcare
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HMO healthcare is a type of managed healthcare where a network of doctors, physicians and pharmaceuticals is set up to create an assistance program. This program aims at bringing down the total expense of medical care. It functions by offering discounts to the insured if they seek medical help within the network. It also offers the benefits of loyalty to the medical practitioners.[br]
The HMO healthcare also pays the hospitals and the doctors (within the network) an annual rate for each enrollee. For a group, a bigger amount is prepaid to the network units. If the group does not use the funds to the fullest, the remaining balance is the bonus for the network units. This process is also called ‘capitation.’
Incentives for Patients Healthier: A Guiding Principle of HMO Healthcare
Based on the principles of optimizing medical costs for patients, HMO healthcare offers incentives to the doctors on the basis of their effectiveness. The Primary Care Physicist (PCP) acts as the gatekeepers. After assessment, they refer the patients to the right doctors. At the very onset, this cuts down the leg work of many who would otherwise spend considerable time trying to identify the problem they suffer from.
The incentive structure aims to contain the cost by encouraging the doctors to cure their patients as quickly and as economically as possible.
Limitations of HMO Healthcare[br]
Being a closed network, the HMO structure limits the options for the patients. When proper care is not available in the network and the need for an outside-the-network doctor is imperative, the patients need to go through a tedious process of getting referrals or else lose the coverage for lapsing on the terms. This limitation has often led people to question the real motive of HMO structure.
However, in a bid to overcome such criticism, California became the first state in the US to revamp the HMO structure and ensure quicker check ups and follow ups. As per the new guidelines, the HMO patients will be seen by a general practitioner within 10 days and within two weeks by specialists.
The new HMO healthcare rules also facilitate call backs within 30 minutes and an availability of doctors 24X7. However, all these reforms indicate a trend towards higher HMO healthcare premiums.
