Managed Health Care

Managed care

a generic term for various health care payment

systems that attempt to contain costs by
controlling the type and level of services
provided.

Health maintenance organization (HMO) is a term

that is often used synonymously with managed
care
Managed-care industry consists of:

Health maintenance organizations (HMOs)

Preferred provider organizations (PPOs)
Managed fee-for-service plans.
The primary intent of managed care is to reduce
health care costs.

Emphasis is placed on preventive care and early

intervention , rather than care provided after an
illness or injury has occurred.

The responsibility of limiting services is placed

on the service provider rather than the consumer.
In the United States, health maintenance organizations have
been in existence since the late 1800s.

In 1950s, the US government began to encourage the

development of HMOs.

In 1973, the Health Maintenance Organization Act was passed;

In 1978, a Congressional amendment increased federal aid for

HMO development.

From 1980 to 1989, enrollment in HMOs increased from 9

million to 36 million Americans.

By 1990, 95% of private insurance companies used some form of

managed care.

In the 1990s, managed care was incorporated into Medicare and

Medicaid plans as well
Brief Historical Overview of the
Philippine Health Care System
In 1969, the Republic Act (RA) 6111, otherwise known as the Philippine
Medical Care Act, was passed. It established the Philippine Medical Care
Plan and the Philippine Medical Care Commission (PMCC).

In 1971 the PMCC was organized with the appointment of a nine-member

Board of Commissioners (ASEAN Social Security Association, 2012).
The PMCC was given the task of administering the Philippine Medical
Care Plan, commonly known as Medicare.
This program implemented a policy to provide total medical services
to the people based on the following concepts of health care:
comprehensive, in accordance with the patients individual needs, coordinated
through the use of government and private medical facilities, and common
pooling of contributions into the Medicare Health Insurance Fund (HIF).
Medicare aimed to provide health care to Filipino citizens in an
evolutionary way within the economic capacity of the country,
and as a viable means of helping the people pay for their own
adequate care. It consisted of two programs or phases, namely:

1. The Medicare Program I (MPI) is designed for the

formal sector of the labor force (regularly employed and
salaried), basically private sector employees who are members
of the Social Security System (SSS), and civil servant-members
of the Government Service Insurance System (GSIS).

2. The Medicare Program II (MPII) is designed for the

informal sector of the labor force, mainly the self-employed
who are not members of either SSS or GSIS.
History of HMO in the Philippines

Began in the late 1970s as a spill over from a successful run in the
United States.

US Congress passed the HMO Act of 1973

Paved the way for a federal grant and loan program to

encourage and stimulate the growth of US HMOs.

PIONEERS WERE:

Philam Care

Medicard

Fortune Care

Health Maintenance Inc.

According to the latest statistics available in the
countrys public insurance system, PhilHealth
(June 2013), 85% of the working class are enrolled
in the system.

Since 1991, there had been major changes on

how the Filipinos view health care, mostly
through active involvement of the private sector
accounting for 50% of the health care system in
the Philippines.
Association of Health Maintenance Organization of the
Philippines Inc. (AHMOPI)

> The official trade association of Philippine HMOs

>Mandated by its mission to protect the interest of the

industry and individual member firms as well as to
improve means of providing appropriate health care at
affordable costs.

Goals:

To attain proper recognition for itself and the industry

>

To establish minimum industry standards

>

To represent the industry in transactions with the

>

government.
Self regulation by AHMOPI

Government requires HMOs to register with the SEC

SEC does not have regulatory power on HMO since they do

not sell securities

- To secure clearance from the Bureau of Health Facilities

and Services of the DOH

- Mandated by Executive Order 102

- Directs DOH to supervise all health care services and

facilities.
- DOH only issues clearance to operate though do not
have direct regulatory power over HMOs.
Insurance Commission (IC)
- Does not consider HMOs as an insurance companies
AHMOPI was formed in 1987 by the first six HMOs:

> Health Maintenance

> Philam Care

> Medicard

> Fortune Medicare

> Health Plan Philippines

> Integrated Health Care Services

Here is the list of companies they authorized for 2016:
1. Asalus Corporation (Intellicare)

website: https://www.intellicare.com.ph/

hotline: (02) 789-4000

2. Carehealth Plus Systems International, Inc

website: http://www.carehealthplus.com/

hotline: 09228447644

3. Carewell Health Systems, Inc.

website: https://www.facebook.com/Carewell-Health-Systems-Inc-130500297034459/

hotline: 4344868/3555771

4. Caritas Health Shield, Inc.

website: http://www.caritashealthshield.com.ph/

hotline: (02) 711-2411 / 09178733882 / 09985795518

5. Fortune Medicare, lnc

website: http://www.fortunecare.com.ph/

hotline: (632) 857-5499 (Manila) / 1-800-10-633-8888 (Provincial Toll Free)

6. Health Maintenance, lnc

website: http://www.hmi.com.ph/

hotline: +63 (2) 811-1313 / +63-917-853-3705 / +63-943-136-5772 / +63-943-136-5773

7. Health Plan Philippines, Inc.

website: http://mainsite2.hppi.com.ph/home

hotline: (+632) 907-2539 (0917) 539-4504

8. Insular Health Care, Inc

website: https://www.insularhealthcare.com.ph/

hotline: (632) 813-0131 / Toll Free Number 1-800-10-8177857

9. Kaiser International Healthgroup, Inc.

website: http://www.kaiserhealthgroup.com/contact.php

hotline: (02) 274 8202 / (02) 274 8203 / (02) 274 8205 / 0917 5642 398 / 0998 9591 088
10. Life & Health HMP, Inc.

website: http://lifeandhealthhmp.com/

hotline: 742-9750/ 781-9682/ 732-4415/ 411-0555/ 4116384

11. Medocare Health Systems, lnc

website: none

hotline: +632 781-9682,

12. Pacific Cross Health Care, lnc. (Formerly Bluecross)

website: http://www.pacificcross.com.ph/

hotline: +63 2 899-8001

13. PhilhealthCare, lnc.

website: https://www.philcare.com.ph/

hotline: (02) 462 1800

14. Value Care Health Systems, Inc.

website: http://www.valucare.com.ph/

hotline: 0917-7-WECARE / (02) 687-3219 / 0917-8862892 / 09256100301

Role of AHMOPI

Primarily regulates the marketing and financial standards.

Premium discounts offered are checked for their

sustainability

Determines standard procedures that can be covered in

hospitals, clinics and by doctors.

Prevent destructive price wars and maintain sustainability

of premium corresponding to an agreed upon quality of
service.

Hears all complaints filed by or against a member firms.

Individuals insured under an HMO or PPO may
receive care only from providers on the panel.

These providers are expected to deliver services

according to specific stipulations.

Payment is often subject to utilization review, in

which delivery of medical services is scrutinized
to determine whether the services are necessary
Payment arrangements between managed care organizations and care
providers are often made in advance.

The health care provider receives a set amount of money each month
based on the number of individuals covered by the plan.

The provider may or may not serve that many people in one month.

Capitation systems provide a steady, reliable cash flow, but involve some
economic risk because the services provided may exceed the dollar
amount allotted.

Another type of payment system uses case rates.

The provider receives a predetermined amount of money per individual

on a case-by-case basis.

The amount of money reflects the estimated service costs to treat the
individual patient's condition.

The provider takes the risk that unanticipated services will be required
Regulation of Health Maintenance Organizations (HMOs)
In the Philippines there is a small group of Health Maintenance
Organizations (HMOs) devoted to providing or arranging for the provision
of pre-agreed or designated health care services to its enrolled members
for a xed prepaid fee for a speci c period of time (Da Silva, 2012-I).
There are three different types of HMOs:
1. The investor-based HMO which is organized to operate at a profit. In
2011 there were 20 issued clearances to operate in Philippines.

2. The community-based HMO, a non-profit organization designed for the

benefit of a particular community. In 2011, there were no such
community-based HMOs recorded to have been operating in the
Philippines.

3. The cooperative HMO which lls the requirements of a cooperative (as

prescribed in the Cooperative Code of the Philippines). In 2011, there
was only one Cooperative HMO.
According to A.O. 34 of 1994 (Rules and Regulations on the Supervision of HMO), the
minimum facilities required to any applicant investor-based HMO shall be:
1. Management of one tertiary hospital or affiliation with five tertiary hospitals

2. An outpatient clinic with basic diagnostic facilities for ECG, chest and extremity X-
rays, CBC, urinalysis and fecalysis

3. Forms of all standard contracts to be entered into with prospective members

4. A copy of the brochures on the standard procedures for availability of bene ts and
fees of PhilHealth/Medicare

5. A statement describing the differences, if any, in the standard benefits and fees of
PhilHealth against non-members

6. A copy of the agreement between the applicant HMO and the providers who shall
furnish the pre-agreed or designated health care services to the HMOs prospective
member

7. A statement of the HMO capitalization duly certified and attested by the Securities
and Exchange Commission (SEC) or Cooperative Development Agency (CDA), as the
case may be

8. A listing of the names and locations of the providers and other persons or facilities
either owned or controlled by the applicant HMO or with whom it has contracted to
furnish designated health care services to its prospective members
 For community-based or cooperative HMO,
the minimum facilities required are:
1. One af liated general hospital
2. One af liated outpatient clinic
3. A copy of the standard bene t packages to
be offered to prospective members 4. Schedule
of fees to be charged for the standard
packages
According to information given by the Association of Health
Maintenance Organizations of the Philippines (AHMOPI)
HMOs covers mostly those in the employed sector.
Payment of premium depends on the agreement among the
employee and the employers.
In 2011, there were around 3.3 million of HMO plan holders,
mainly located in Metro Manila. Usually, the payment
mechanism is per service, but there are some cases of
capitation (Da Silva, 2012-I)6.
Difference Of HMO, Health Insurance And Medical
Insurance

Health Maintenance Organization (HMO) is a

prepaid health care system wherein an Insurance
Company handles the distribution of networks,
providers, and members all in one umbrella.

Health insurance covers pre and post care that

handles an individuals well-being.

Medical insurance covers treatments at the time

that an accident or disease occurs.
Gatekeeper model of HMO

the primary care physician (the Gatekeeper) is paid an

amount per patient assigned to him per month whether
they see him or not.

If no patient sees him, he still gets that prepaid amount.

If there are more patient visits, he still gets paid the same.

when a patient needs a specialist, the Gatekeeper (who

guards the "gate" and controls patient traffic) needs to
share the fee to pay the specialist's fee.

referral to specialists in gatekeeper model are sometimes

delayed or intentionally neglected compromising the
quality of healthcare.