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HMO Growing More Popular

October 4, 1996
By: David Freitas
State Capital Bureau

A report published this week by the Journal of the American Medical Association finds that Health Maintnence Organizations are treating some of their patients very well.

The study found those patients that are chronically ill tend to have worse health if their in an H-M-O.

H-M-O's are disputing the findings, saying they are outdated and that improvements have been made since the study ended in 1990.

The fact is H-M-O's are growing more and more common, even here in Missouri.

Over a million Missourian's are currently enrolled in an H-M-O...

And they are all part of the managed care experiment that hopes to reduce costs and improve health care across the country.

Although H-M-O membership is widespread, patients are often confused about what HMO's are-- and what they do.

Reporter David Freitas explains what HMO's are and their advantages and disadvantages.

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Health Maintence Organizations are now one of the most used health plans in the country, with about 56-million members.

An H-M-O is a type of health care plan in which treatment is based on a fixed, prepaid amount.

To reduce high costs in medicine, HMO's use a primary care physician that refers you to other specialists-- if needed.

What does all that mean?

It means that every month your health care provider, in most cases your employer, pays a certain amount of money to the H-M-O to take care of your medical needs.

If it costs the H-M-O more to take care of you than the prepaid amount, then the HMO loses money.

If it costs less, the H-M-O makes money.

H-M-O's were created to try and reduce the ever rising costs of medical care.

Randy McConnell, a spokesman for the Missouri Department of Insurance, says so far the plan has been successful.

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Contents: McConnell says the cost savings have been a great contributor to the shift towards managed care.

Dr. Joe Hugenard, Corporate Medical Director of Alliance(uh LEYE uhns) Blue Cross-Blue Shield, which runs Blue Choice here in Missouri, agrees with McConnell.

He also says they are other advantages to HMO's.

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Contents: Hugenard says HMO's can bring you a better check on care that you receive.

Despite what McConnell says there are also concerns about the profit-driven nature of an H-M-O.

Critics claim that HMO's put the almighty dollar before the health of the patient.

They say doctors are discouraged to provide certain treatments because profit is based on how many services are used.

Critics claim that can interfere with the patient-doctor relationship.

Some HMO's have gag clauses which can also prevent your doctor from talking with you about all your medical options.

Mexico Senator Joe Maxwell, co-chair of a legislative committee studying managed care, says those clauses a big problem.

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Contents: Maxwell says doctors practice medicine and when insurance companies get involved that's wrong.

But Hugenard disagrees with Maxwell.

And he says doctors in his HMO still have the upper hand.

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Contents: Hugenard says when its a clinical situation they still try to let the doctors make the decisions.

The conflict between patient and HMO can also be razor sharp in emergencies.

Many patients complain their HMO's have vague definitions of emergency services that leave patients wondering when a trip to the emergency room will be paid for.

Some require a patient with a broken bone to call for an over the phone referral before going to the emergency room.

If they don't, the HMO may not cover the expenses.

Randy McConnell with the state Department of Insurance says patients can run into other problems with emergency services as well.

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Contents: McConnell says that typically what happens is that patients go in for emergency care when it was not an emergency. HMO's then say the patient should not have gone for emergency services.

But Hugenard disagrees with McConnell.

Hugenard says HMO members do not always have problems in emergencies.

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Contents: Hugenard says that his HMO's says if someone collapses then things are moving too fast and not to worry about calling.

Despite all the debates about the advantages and disadvantages of HMO's they're not going away any time soon.

Last year alone Missouri's HMO's experienced a 60-percent increase in membership.

What critics and supporters alike say is that in order to solve the confusion and problems surrouding HMO's, HMO members need more information.

For KBIA's Capital Edition, I'm David Freitas.


Additional Sites of Interest
  1. Buysmart is a consumer's guide to HMO's.
  2. The HMO page, designated specifically to the subject of HMO's.
  3. The Physicans Who Care, a group devoted to the care of the patient.
  4. A good article on HMO's in US News and World Report.
  5. Time's cover story on HMO's.