The Quality of Health by Health Medical Organization

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The quality of health care which a population receives is predetermined by a skillfully chosen management plan. Health Medical Organization is a certain strategy of managed care planning used by a healthcare institution to regulate the relationships between it, a physician, and a patient. This term was coined by Paul Ellwood (as cited in Marcinko & Hetico, 2011) who narrows the concept of HMO to “a group responsible for both the financing and delivery of health to an enrolled population” (p. 14). The HMOs major benefit lies in doctors acquaintance with each patients family, social, and financial situations that is a solid basement for a qualified health care (Hunter, n.d.). There are two major types of HMOs subdivided into various specific models having both advantages and disadvantages that are described in the given paper.

HMOs Types

The classification of HMOs is based on their peculiarities that appear in the relationships between physicians, the members of these organizations who get medical service, and the health care institutions. Open-panel and closed-panel plans are two major types of health medical organizations. Open-panel HMOs include private physicians legally agreeing to provide the HMOs members with health services. These private health care providers should only accept the specific terms of HMO and meet all its criteria (Kongstvedt, 2013). On the contrary, closed-panel HMO is based on the medical service provided by a single medical group associated with the HMO (Kongstvedt, 2013). Closed-panel HMOs are considered to be more old-fashioned, which is confirmed with Marcinko and Hetico (2011) claiming that open-panel HMOs “give physicians more latitude for independent thought and decision-making skills” (p.14). A deeper classification is provided with a further subdivision of these major types of HMOs.

Traditionally, open-panel HMOs include two models of collaboration with private health care providers. The first one is called an independent practice association model. It is based on the absence of the direct contraction between physicians and HMOs (Kongstvedt, 2013). It means that a doctor is not legally affixed to his/her HMO, which gives him an opportunity to be an incumbent member of another medical institution, have personal offices and medical crews, and treat non-HMO patients. On the other hand, the second type of open-panel HMOs called direct contract model diversifies the relationships between physicians and HMOs. The connection is based on the direct contract between a physician or a medical group with HMO (Kongstvedt, 2013). In this case, the outer activities of a private health care provider are restricted by the terms of employment, although a physician remains a private practitioner.

Closed-panel HMOs include two models of collaboration as well. The first one called a group model aims to create multispecialty groups that are contracted by HMOs and provide versatile services to HMOs members (Kongstvedt, 2013). Marcinko and Hetico add that the physicians referring to a group practice are allowed to work in a private office and treat non-HMO patients as well (Marcinko & Hetico, 2011). The group members share the same equipment, medical documentation, facilities, and supporting medical staff. In addition, HMO is capable of either creating a new physician group, which is called a captive one, or contracting with already existing independent group of various specialists. A group model allows HMOs to fill the basic positions and provide their members with a complex of health services. Another closed-panel model is called a staff model and considered to be the most restrictive plan of providing medical services. This model is considered to be the most spread in the health care market (Ozcan, 2008). The physicians are the official employees hired by HMO on the most common positions to match the needs of the HMO members (Kongstvedt, 2013). However, doctors are affixed to a certain medical location and may treat the HMO members only. The given model is characterized by a lower productivity level since the circle of patients is limited, while the physicians lose their right for an independent research work.

Both open-panel and closed-panel classifications of HMOs have strong and weak points. The open-panel models of HMOs are mainly appreciated for the variety of qualified specialists located throughout the service area, which makes it easier for the HMOs members to find a health care provider not far from their houses (Kongstvedt, 2013). Furthermore, the independence of the physicians makes it unnecessary for the HMOs to pay much attention to maintaining a fruitful collaboration between them. However, the employment of the private practitioners requires bigger funds and reduces the benefit of HMOs. On the other hand, the closed-panel models of HMOs are more useful for the employers since they do not have to hire administrative staff with the option of leaving routine work for physician groups (Kongstvedt, 2013). Unfortunately, the closed-panel models tend to cause some inconveniences to the HMOs members such as having different doctors or sticking to the location of a medical institution.

Taking into account all mentioned advantages and disadvantages of the various HMOs types, I could claim that the open-panel models are more convenient and universal, thus, more suitable to the conditions of Florida. Furthermore, the 2014 Florida HMOs report has shown that most of the closed-panel HMOs had losses (15 of 34 Florida HMOs Report 2014 Losses, 2014). This fact may be connected with the disproportion between a growing number of enrollees and a lowered quantity of the newly employed medical staff. However, I see no point in shifting the priority to the open-panel models since they are functionally and economically inefficient in medium and large cities that prevail in the state of Florida.

All in all, a deeper insight into the classifications of HPOs has revealed key qualities of the various health care models. The observed advantages and disadvantages have helped to decide which model is the most efficient for Florida.


15 of 34 Florida HMOs Report 2014 Losses. (2015). Web.

Hunter, R. (n.d.). HMO Insurance. Web.

Kongstvedt, P. R. (2013). Essentials of Managed Health Care. Burlington, MA: Jones & Barlett Learning.

Marcinko, D. E., & Hetico, H. R. (2011). Revolving Health Care Industrial Complex: The Changing Health 2.0 Economics and Financial Ecosystem. In D. E. Marcinko (Ed.), The Business of Medical Practice: Transformational Health 2.0 Skills for Doctors (pp. 1-27). New York, NY: Springer Publishing Company.

Ozcan, Y. A. (2008). Health Care Benchmarking and Performance Evaluation: An Assessment Using Data Envelopment Analysis. New York, NY: Springer.

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NursingBird. "The Quality of Health by Health Medical Organization." December 22, 2021.