The Problem Statement
As health care costs climbed exponentially in the 1980′s, so did the cost of health insurance plans. As a result, employers began to enroll their employees in managed care organizations, and many Americans were forced to leave their traditional indemnity type plans. With the advent of the health maintenance organization, there is a financial incentive for the underutilization of care. (Blumstein, 1996; Davis & Shoen, 1996).
In order to reduce financial risk, health insurance companies have restricted enrollment to individuals in poor health. By covering the minimal standards of treatment and excluding high risk groups altogether, major US insurance companies have realized that the health insurance market can a be an extremely profitable industry. The public sector absorbs the cost of unreimbursed care for chronic care in America (Robert Wood…
View original post 9,298 more words