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Ethical Implications of Administrative and Organizational Decisions

A managed care organization is a healthcare delivery system that seeks to lower healthcare expenditure costs while maintaining a high quality of care (Heaton, 2022). Some of these features include Primary Care Providers (PCP), provider networks, and prescription drug tiers.

Managed care organizations have made several attempts to manage healthcare costs while lending quality care. These measures include saving money on medicines. This can be achieved in several ways, like inquiring from your health care provider if you can change your medicine to generic ones that contain similar active ingredients but cost less than brand-name drugs. Also, one can inquire from the health care provider if there are less expensive drugs that cure the same condition (MedlinePlus, 2020). One can use a Health Care Savings Account (HSA), which is convenient as it sets aside before-tax funds for health care expenditure.

Predominantly, the managed care operation makes efforts to institute provider networks. The provider networks offer their services to members in a given geographical region through a health plan that is accessible. They consent to provide these services at lower costs (MedlinePlus, 2020). The health plan finance more funds for your care through provider networks, reducing the cost one could have used if one visited a doctor and not the network.

Preferred Provider Organization (PPO) allows members to consult any physician of choice, whether in- or out-of-network. One may pay less for services offered by providers who are in-network, possibly because they have a contract with the concerned health plan (MedlinePlus, 2020). In the case of a procedure or surgery, one may ask the provider if one can have the procedure at an outpatient clinic that is more cost-efficient than in a hospital.

Another feature of the managed care plans is the precautionary care inducement. Health care plans prioritize it as most prophylactic services like regular screenings, and yearly check-ups are 100% covered by the health plan. This saves many funds that could have been used by patients who have regular check-ups with the physician (MedlinePlus, 2020). For instance, patients who have diabetes or early stages of cancerous diseases before they become severe and costly.

There are many benefits associated with the cost-controlling measures by managed care organizations. They include; patients who have numerous choices for coverage. The patients can choose one of the three health plans with different coinsurance rates depending on the desired type of service. It may be health maintenance organizations, preferred provider organizations, or point of service plans. People can quickly seek care within their network, which can be rendered quickly and efficiently, including referrals to specialists who need one (Gaille, 2017). There is the assurance of care within the network as the managed care networks implement several accreditation processes to facilitate effective patient care.

The expenditure used on prescribed drugs is less. Provider networks collaborate with pharmaceutical agencies to meet the required prescriptions at affordable prices. This lowers the cost of health care for the concerned patients (Gaille, 2017). Also, relationships between the doctors and patients Are fostered; necessary information is acquired to get the proper diagnosis.

Some drawbacks of controlling the costs include limited care access for patients without insurance or provider coverage. This primarily affects the poor in a managed care system, giving them limited options. There are restrictions on where patients can access services and get referrals; hence patients may be forced to defend their needs. Privacy is violated as personal medical files are shared with the managed care organizations as part of payment and planning procedures (Gaille, 2017). Preoccupied networks can have issues with the delivery of service.

In summary, managed care organization is a sound health care system that puts the members’ needs at its heart. It ensures good quality services are offered to the members at cost-efficient rates. Despite having a few limitations, it serves much good as good health is vital to a better life.


Heaton, J. (2022, March 9). National Center for Biotechnology Information. National Library of Medicine. Retrieved July 19, 2022, from

MedlinePlus. (2020, August 13). Eight ways to cut your health care costs: Medlineplus medical encyclopedia2020. MedlinePlus. Retrieved July 19, 2022, from

Gaille, L. (2017, June 15). Twelve advantages and disadvantages of managed care. Retrieved July 19, 2022, from


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