Managed Care
| Description | In managed care, patients select an insurance plan to manage all of their health benefits. The insurance plan contracts with a network of providers to deliver services. Enrollees are limited to receiving care from network providers only, except in limited circumstances. |
| Patient Population |
All and increasingly for Medicaid populations with long term services and support needs that had traditionally been excluded from managed care |
| Typical Lead |
Commercial Managed Care Organizations; Large Providers, e.g., Hospitals, Large Physician Groups, and Integrated Delivery Systems for Provider-Led Variation |
| Role of Home Health | Home health providers contract with MCOs to provide a subset of services. MCOs are generally not restricted by the same rules as government payers (Medicare and Medicaid). Therefore, home health agencies may contract with MCOs to provide a broader range of services. |
| Reimbursement Model | Payers reimburse MCOs on a capitated per member per month basis. MCOs generally accept full risk for costs associated with managing their enrolled population. MCOs contract with providers through a variety of mechanisms. While most contract on a fee-for-service basis, MCOs are increasingly looking at value-based payment methodologies, including capitated payments for primary care services, and pay-for-performance for other providers. |
| Minimum Infrastructure Requirements |
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| Variations | Provider-led MCOs, which are generally operated either by a large provider (e.g., hospital, large physician group) alone or in partnership with an existing MCO serving in an administrative capacity. |