Academic journal article Alcohol Health & Research World

Managed Health Care

Academic journal article Alcohol Health & Research World

Managed Health Care

Article excerpt

The rapid development of managed care systems has resulted in sweeping changes in the U.S. health care system, including alcoholism treatment. Although the forerunners of such systems date back to the 1920's (MacLeod 1993), the modern development of managed care accelerated during the 1970's, stimulated by the private sector in response to years of unchecked inflation in health care costs and by widespread resistance to the concept of a national health insurance. The passage of both the Health Maintenance Organization Act in 1973, which required minimal benefits for alcohol and other drug abuse treatment, and subsequent amendments facilitated the expansion of the corporate practice of medicine. Large enrollment health care programs developed through new means of financing. These programs proliferated, with the expectation that competition between different programs would help contain health care costs with minimal government intervention.

One outgrowth of this movement was a major shift in the financing of health care. In many cases, individual fee-for-service payments were replaced by one prepayment covering services provided to each subscriber in the system for a specified period. This process is known as "capitation." Under these new plans, health care providers had to bear part of the financial risk in providing services-for example, if providers incurred expenses exceeding the budgeted estimates, they had to absorb the deficit. …

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