M7 Managed Care Discussion/Capitation Paper
The Basic Tenets of a PPO Plan and a HMO Plan Name: Institution: The Basic Tenets of a PPO Plan and a HMO Plan Discussion Health Maintenance Organizations (HMOs), preferred provider organizations (PPOs), point-of-service (POS) and consumer directed health plans (CDHPs) are the major group insurance plans in the United States.
Introduction
A hallmark of a PPO is that benefits are reduced if a member seeks care from a provider who is not in the PPO network. In the event that a subscriber chooses to seek care from a nonparticipating provider, the responsibility falls on the subscriber and the subscriber bears any charges not paid by the PPO. PPOs are far less expensive than traditional insurance, though usually more expensive than HMOs unless the PPO has a high degree of cost sharing with consumers. HMOs are fundamentally different from the other open plans with exception of open-access HMOs similar in benefits design to PPOs (North Carolina Institute of Medicine, n.d.). With a few exceptions, benefits to members in an HMO must be provided by the HMO’s providers in compliance with the HMO’s authorization procedures. HMOs is referred to as prepaid plan because the plan only pays for services up to a certain amount which an individual has subscribe with the additional costs payable by the subscriber. Advantages and Disadvantages of the Capitation System In Relation To Dental Health Care In terms of the cost of raising the level of dental health, capitation programs emerge to be more efficient for several reasons. ………………………………
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