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The Role of Managed Care Organizations in the Healthcare Environment

Managed care organizations (MCO) have become a significant part of the overall healthcare environment, aiming to address the system’s challenges. They adhere to strict standards, which are necessary to follow to ensure safety and affordability. Failing to comply with them may put patients at risk, so organizations should have appropriate policies and recognize their unique role in care provision; otherwise, vulnerable populations may feel even more defenseless.

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Healthcare organizations conduct risk management while pursuing several essential goals. First of all, as providers, they are responsible for reducing medical errors, such as prescribing or administering the wrong medicine (Kongstvedt, 2019). Then, they manage the insurance risk and work towards eliminating one’s financial burden without detriments (Kongstvedt, 2019). Another aspect concerns post-litigation events, which may equally threaten the organization and the patients (Kongstvedt, 2019). For instance, one Supreme Court ruling was against the expansion of Medicaid, which required an appropriate response (Kongstvedt, 2019). Thus, MCO’s administrative role in risk management involves the mitigation of medical errors, healthcare costs, and litigation outcomes.

Regulatory statutes may provide a considerable value to MCOs, although some can be limiting. For instance, SSA, Sec. 2105(a)(1)(D)(ii) allows for flexible dollars to promote health initiatives targeting low-income (Hughes & Mann, 2020). Meanwhile, SSA, Sec. 1852 is only valuable for programmatic expenses, ignoring other areas (Hughes & Mann, 2020). As far as risk management and conflict resolution are concerned, they may not fall under the Employee Retirement Income Security Act and require state involvement, which does not always culminate in a beneficial outcome for patients and employees (Kongstvedt, 2019). Altogether, some statutes are valuable, while others are limiting or detrimental.

MCOs are directly responsible for preventing fraud, waste, and abuse. They should ensure that the claims-paying process is properly administrated, reduce program vulnerabilities, and promote transparency (Cormack & Brown, 2021). The establishment of a Special Investigations Unit is also an essential tool to address the issue, defending the payer’s side (Kongstvedt, 2019). MCOs should focus on integrity and accountability to further comply with the laws.

MCOs help vulnerable populations while not being particularly invincible themselves. While some regulations are genuinely beneficial to follow, several statutes may hinder their work and put patients and employees at risk. Criminal activities are also rampant, prompting MCOs to strengthen plan soundness and implement stricter policies, although the issue is persistent. Still, they have certain obligations and should attempt to improve the overall health environment and accessibility.

References

Cormack, L., & Brown, H. (2021). A decade of congressional efforts to conduct and communicate oversight of Medicare and Medicaid. Public Policy & Aging Report, 31(2), 47–52.

Hughes, D. L., & Mann, C. (2020). Financing the infrastructure of accountable communities for health is key to long-term sustainability: A legal and policy review to identify potential funding streams specifically for Accountable Communities for Health infrastructure activities. Health Affairs, 39(4), 670-678.

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Kongstvedt, P. R. (2020). Health insurance and managed care: What they are and how they work (5th ed.). Jones & Bartlett Learning.

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StudyCorgi. (2022, September 26). The Role of Managed Care Organizations in the Healthcare Environment. Retrieved from https://studycorgi.com/the-role-of-managed-care-organizations-in-the-healthcare-environment/

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StudyCorgi. "The Role of Managed Care Organizations in the Healthcare Environment." September 26, 2022. https://studycorgi.com/the-role-of-managed-care-organizations-in-the-healthcare-environment/.

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StudyCorgi. 2022. "The Role of Managed Care Organizations in the Healthcare Environment." September 26, 2022. https://studycorgi.com/the-role-of-managed-care-organizations-in-the-healthcare-environment/.

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StudyCorgi. (2022) 'The Role of Managed Care Organizations in the Healthcare Environment'. 26 September.

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