What is "managed care" in health insurance?

Managed care in health insurance primarily refers to a method of managing costs by controlling access to and the delivery of healthcare services. This approach aims to enhance the efficiency of healthcare delivery while simultaneously ensuring quality care for patients.

Managed care organizations often employ various strategies such as establishing networks of preferred providers, implementing care coordination, and utilizing preventive care measures. By overseeing the type and level of care provided, managed care aims to minimize unnecessary procedures and hospitalizations, ultimately leading to cost savings for both insurers and consumers.

This model typically involves a framework where patients may have to choose from a select group of healthcare providers in order to receive their full benefits. By influencing decisions about services, managed care can help maintain the quality of healthcare while also curbing excessive healthcare spending.

The focus on managing costs through controlled access and delivery is key to the concept of managed care, making it an essential part of modern health insurance solutions.