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60 CHAPTER TWO an oV ienc i ’ Spcifllg:grgoac()éhgc) .c[ficmncy of service delivery (Trends in Health Care Costs and One spccial version of the HMO is the independent practice association (IPA) The IPA hires physicians to provide services for HMO members. Physicians n;a' : contract with several HMOs. In most instances, the fee for service is neaoliatec)i/ between the HMO and the physicians. In many areas of the country the IPA advo- cates for quality services for clients and uses collaborations to improve client care. From the client’s perspective, the site-of-services restrictions also represent the greatest disadvantage of an HMO. Clients do not like limits on their use of providers; they wish for more freedom to choose. In response to members’ de- mands for freedom to choose their own providers, two other managed care sys= tems have emerged: PPOs and POS. PREFERRED PROVIDER ORGANIZATIONS The term preferred provider organization (PPO) does not describe any single type of managed care arrangement. Rather, this plan falls between the traditional HMO and the standard indemnity health insurance plan. The following charac- teristics apply to PPOs (Joint Interim Committee on Managed Care, 2000): « Contracts are established with providers of medical care. « These providers are referred to as preferred providers. « The benefit contract provides significantly better benefits for seryices re- ceived from preferred providers. « Covered persons are allowed benefits for n onparticipating providers’ services. PPOs point with pride to their prompt payment of claims. The providers ac- which represents the PPO fee, and they do not bill + Based on the negotiated fee, both the clients and the PPO can anticipate their costs, and providers can anticipate their income. From the providers’ perspective, they are assuming a business risk in terms of the fees that they agree to accept. On the other hand, they expect to increase the number of patients under their care, Many providers also maintain independent medical practices. cept a ncgoliated discount, patients an additional amoun \ POINT-OF-SERVICE The third option of managed ca wraditional HMO members who w provide. The following features ch re offered today is the POS. It is often adopted by ant more flexibility than the HMO or the PPO aracterize a point-of-service plan: out-of-plan providers, but if they do, they « Customers are allowed to use receive reduced coverage. « To participate in a POS plan, clients pay » ibles, and a higher percentage of the medical fees. « Clients are encouraged to use the providers in the man they receive partial benefits if they choose medical care outside the system higher premiums, higher deduct- aged care system, but rgin, s il purty Cousans amp o e Cimmmsa. avsemsitn s M S 45 s whole e i past. Duc 2 PIESToS il i o, May 8t be copied, samed, of Auplicaied ¥ - V: e « u g ot il bbb M counge Leaming. All Rights Rexct b :“LM(.A Frkshawaal vomeonss I sl thns P ] Copyright 2013 Ce b aBlewd andios < ‘MacBook Air