HMO plan a health care alternative

Abstract

William Mays, M D H ealth maintenance organizations (HMOs) are becoming a preferred alternative to traditional insurance and health care delivery systems because they offer more benefits at less cost to their members. HMOs have components similar to health insurance companies and traditional systems of health care but are different for several reasons. While traditional indemnity plans either reimburse subscribers or the provider for services already rendered, the HMO provides the services to its subscribers on a prepaid basis. Michigan HMO Plans is one example of an effective, efficient health care delivery system based on the HMO model. Michigan HMO Plans is an organized delivery system in which individual health care centers offer all primary care medical services. Licensed by the state of Michigan since February 1974, the organization provides health care services to more than 32,000 subscribers in an area that includes Wayne, Oakland, and Macomb counties and most of the state’s residents. Our plan includes 36 primary health care centers, 38 strategically located hospitals, and 26 dental centers under contract in the Detroit metropolitan area and is the largest health care delivery system of any licensed HMO in the state. Because of the location and number of its health care facilities, Michigan HMO Plans provides greater availability and accessibility of care to its subscribers. There are four reasons why the Michigan HMO Plans is able to offer more benefits a t less cost. 1. Its physicians are prepaid for their services. Thus, increased use of physicians’ services cannot increase the cost of care to the HMO enrollee. 2. The system provides health care through an organized delivery system, ie, it has the potential to be efficiently managed.