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In the United States, Medicare programs are in the rise as they are being favored by many researches carried out due to the presence of many and diverse Medicare challenges. The government of the United States has also played a significant role in the development of the Medicare programs. The Medicare managed-care plan is being encouraged in the United States because of the added coverage it has over the Medicare plans. Studies have been carried out and revealed that the Medicare Advantage Plan is a bit cheaper than the Medical Fee for Service even with its enhanced effectiveness and efficiency.
A Medicare managed care is a plan for individuals to obtain coverage for their bills of health care, which is not paid for by the Medicare. The Medicare managed plans are the programs that are run by the health care agencies. They include the health maintenance organizations (HMOs) or the preferred provider organizations (PPOs), whereby, they are involved in the provision of Medicare coverage as well as coverage left as gaps by the Medicare coverage.
The Medigap polices provide basic Medicare in the same way as the Medicare managed care; and they can appear to replace each other. However, the Medicare managed care is different from the Medigap policies in the basis of its operation. While Medicare and Medigap policies will operate together to pay the client's medical bills, they have different extents to which they operate (Elliott Et al. 2011).
While the jurisdiction of the Medigap polices will extend to the point of the coverage of the bills, the Medicare managed-care plans will go further than just the bill level. Other than providing the client's Medicare coverage, the Medicare managed care will include other coverage extending to the filing of Medicare coverage gaps. The managed-care plan controls the extent of the clients beyond Medicare, as well as the premiums size and copayment size. The managed-care plan is also the one that makes the decisions regarding payments for the clients’ treatment (Elliott Et al. 2011).
The managed care is distinct in that the clients are left to agree on the specific hospitals, specific doctors and others in the network of the Medicare exchange aimed at reducing the costs of the overall healthcare costs. In the light of the provision for chances to choose on the part of the clients, the Medicare managed care provides a variety of provisions for the patients. For example, there is a Medicare managed-care plan that provides narrow limitations on consulting with specialists or accessing practitioners from outside the network. There are others that do not impose restrictions to the patients’ freedom in choosing the doctors to consult for their treatment. However, the premium charges for a particular Medicare managed-care plan vary with increasing trends inclined to expand the choice's ability of the client.
In further pursuing of the economic implications of the Medicare managed care for the clients, it is necessary that individuals make some research on the available options in their area. It is essential that such individuals check on the adequacy of care, as well as costs for each particular healthcare managed care in the proposal. It is also necessary that the cost will include the doctor’s visits together with the prescribed drugs.
There are several types of managed-care plans. The health maintenance organization (HMO), preferred provider organization (PPO), and provider sponsored organization (PSO) are some of the available types of managed-care plans. Out of the three aforementioned types of the Medicare managed-care plan, the HMO is the least expensive. The HMO is also popular for its restriction, which ranks higher than the others.
Other than the Medicare Health Plan, individuals have a choice of Medicare Advantage Plan as a part of their Medicare. The Advantage Plans are, however, offered by the private companies, which are approved by Medicare. The Medicare Advantage Plan provides clients with all of their Part A and Part B coverage. In the Medicare field, the Hospital Insurance is referred to as Part A, while the Medical Insurance is Part B. Other than covering for the Hospital Insurance and Medical Insurance, some Medicare Advantage plans offer extra coverage that may include the coverage for hearing, dental, vision, and health and wellness programs. At the same time, the majority of the Medicare Advantage Plan will cater for Medicare prescription drug coverage (Part D).
Basically, it is the Medicare that pays some fixed monthly installments to the Medicare Advantage Plan providers. The Medicare Plan Providers are entitled to follow some rules set by the Medicare. It is, however, common that each Medicare Advantage Plan imposes different extra costs, as well as different rules for their service provision. The clients subject to the rule of the Medicare Advantage Plan on whether they require a recommendation of seeing a specialist, or go to see a doctor alone.
The cost analysis of a Medicare Advantage Plan involves various considerations. It is also notable that the clients are required to pay for their Part B premium, and some added monthly premiums for the included services. At the same time, each Medicare Advantage Plan has its unique, extra costs to the clients. Since the clients subjected to a Medicare Advantage Plan have an option for obtaining their Medicare by Medicare Fee for Service, the cost considerations for the two available options can be looked upon by their various implications to the client.
In case of Medicare Advantage Plan, the patients are obligated to go to a middle man, who is usually the assigned primary medical practitioner; although, sometimes they will go to the practitioner-nurse, prior to being sent to a specialist. This, in the eyes of many, can appear to be inconvenient. It can also mean a waste of the patient’s time. Opponents of Medicare Advantage Plan may argue that the patients are better placed if they see a specialist to obtain the needed Medicare. What the opponents of Medicare Advantage Plan fail to anticipate is the cases where the efforts of a specialist can be proved unnecessary, thus saving the patients' money and even time, not mentioning the inconveniences of operations and tests.
There can be cases where the patient may actually know which specialist could be right for his problem. Even in such cases, it might not always be necessary for the patient to obtain an expensive service from the specialist. The Medicare Advantage Plan offers a chance for possibilities, as when a nurse-practitioner could have done as well as a specialist, thus saving the patient’s money. In the light of this, the Medicare Fee for Service is more expensive than the Medicare Advantage Plan.
In many cases, Managed Care organizations carry out scrutiny for expensive procedures to ensure that they are necessary (McGuire, Newhouse & Sinaiko, n.d). By scrutinizing the expensive procedures for the clients, the Medicare Advantage Plans are able to wedge into the gap between the patient’s desire or need and their economic pressures. Following the findings, the 30 per cent of surgeons’ recommended operations are not necessary; the intervention by the Medicare Advantage Plan comes at the right moment. As an example of the operations that managed care refuses to pay for is hysterectomy, the uterus removal. The basis for this refusal is the complaints about patients calling for hysterectomy, while they can successfully be treated with other less-expensive methods. Of course, this has ultra slim chances of occurring in Medicare Fee for Services, and thus becoming more expensive (McGuire, Newhouse & Sinaiko, n.d).
The Medicare Advantage Plan has the ability of eliminating expensive doctors and other medical practitioners from the lists of providers (McGuire, Newhouse & Sinaiko, n.d). The way the Medicare Advantage Plans determine that particular doctors are overpriced is by the doctors ordering abnormal number of CAT scan, X-rays and laboratory procedures. The Medicare Advantage Plans organizations utilize the information technology to research on the effectiveness of the doctors they are to enroll in their lists of providers. By doing so, the Managed Care organizations obtain the benefits of eliminating high-priced doctors and also caution the remaining ones. In the case of Medicare Fee for Service, it is hard to obtain such levels of specializations, thus medical service remains expensive.
The Medicare Advantage Plans organizations are also able to identify medical practitioners who have tendencies of offering significantly expensive medications. At the same time, the doctors who over-exploit the hospital facilities are identifiable through the same procedure. Theoretically, the Medicare Advantage organizations obtain some levels or accuracy index of skills for the doctors engaged in their programs, especially for treatment of specific cases. It is agreeable that such studies are done rarely; on the contrary, the Medicare Fee for Services options will not provide such a service (Berenson & Dowd, 2009).
In notable cases, Medicare Advantage organizations operate their own health facilities in the rural areas. In such facilities, the staff and doctors are commonly paid by the organizations. This eliminates the fee-for-service, which is normally subjected to the individual patients and is expensive. The collectively run health facilities enable cost-saving measures, such as technicians and nurse-practitioners carrying out the work that could otherwise be done by doctors. The Medicare Advantage Plans are, therefore, able to cut down on the overall costs for the client members, making them a bit less expensive than the Medicare Fee for Services.
Finally, the large enough number of members of the Medicare Advantage organizations enhances their bargaining powers (Berenson & Dowd, 2009). The bargaining power is mostly put in practice during the hospital and pharmaceutical negotiations. Where the Medicare Advantage Plan contracts with private and public hospitals for their membership, they are able to obtain flat daily rates for the hospital charges and extend the cheap services to their clients. Therefore, it is evident that the Medicare Advantage Plan is less expensive than the Medicare Fee for Services by the individual members with limited bargaining powers.
The operators of the Medicare Fee for Services have the advantage of being exempted from network requirements for adequacy (Kaplan, 2011). This can have some economical implication, cutting down charges for the patients. While the Medicare Fee for Service is exempted from the requirements of network adequacy, the impact can be so minimal to the point of being significantly felt by the individual clients. Therefore, on the grounds of the aforementioned fact, the Medicare Fee for Services cannot be said to be less expensive than the Medicare Advantage Plan.
Other than the Medicare Fee for Service providers being exempted from adequacy requirements for network, they also are subjected to fewer requirements, while they benefit from particular statutory and rules of administration. Nonetheless, this service is expected to cost less to the patients. The problem usually arises from the fact that the bargaining power of the patient is weak. It can also be argued that most of the providers are private individuals who cannot afford to be everywhere treating all possible cases in terms of clients’ state of health. Therefore, the patients who go for Medicare Fee for Service will be subjected to more subjective operations than is the case with the patients opting for Medicare Advantage Plan (Kaplan, 2011).
Research data by Medpac on preference of Medicare Fee for Services shows that they take more than three-quarters of the overall options available for Medicare beneficiaries. This indicates that the Medicare Fee for Services is gaining popularity despite its expectation of being expensive. However, in the same study by Medicare Payment Advisory Commission (MEDPAC) (2008), the Medicare Fee for Services accounted for 19 per cent of the total Medicare Advantage Plan enrollment. They actually accounted for 60 per cent of the 2006 to 2007 enrollment growth. Figures indicated that during the period from 2006 to 2007, Managed-Care plan's enrollment remained flat (MEDPAC, 2008).
The employers are also seen to be playing some significant roles in the Medicare Advantage Plan. It was noted in the employer-only plan that the year 2008 tended to be higher than other plans with a noted 108 percent. At the same time, the payments by the employer-only plans showed an average of 116 percent of the Fees for Service spending. The impacts of the employer-only plans to the Medicare Advantage are detrimental as they compromise the ability of the Medicare Advantage plans.
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The Medicare Managed Care helps individuals to pay for their Medicare costs. The Medical Advantage plans have coverage on such health issues of the patients as visual, dental and hearing problems. These plans are being encouraged to be adapted currently. When Medicare Advantage Plan is compared to the Medicare Fee for Service, it has evidence of effectiveness and efficiency added to the fact that it is less expensive than the Medicare Fee for Service.
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