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"The term managed care refers to a team of activities designed to lower the costs of providing health care and yet delivering high-quality American health care while improving the overall quality of the care. The ultimate goal is to provide optimal health care at an affordable price, using the greatest possible resource mix. Managed care plans fall into a number of categories, including:"

"Managed care plans are generally supported by health insurance companies, though they sometimes provide their own doctors and specialists. Most Managed care plans focus on keeping health costs down by contracting with health care providers who provide the least expensive services. Managed care providers participate in a network, so when one person in the network requires specialized treatment, the provider making the call gets payment. This form of “networkship” allows managed care plans to offer more options and coverage than health insurance companies alone could do."

"There are several different types of managed care plans, including: fee-for-service; fee-for-service plus managed care plans; and Medicare Advantage, also known as Medigap. Fee-for-service plans are generally the most common type of managed care plan in the United States. These allow the health care provider to set the amount they are paid for services and the types of services covered. The health care provider and the insurance company jointly agree on a dollar amount for each service. Some managed care plans allow a choice of out-of-network doctors, although Medicare does not."

"Managed care plans may also include hospitals within the managed care plan's network. This provides the added benefit of skilled doctors and the ability to treat more patients. Many health insurance plans limit the number of hospitals, a patient can see under their health plan, which limits the freedom of the patient in terms of where they receive their care. Health care providers and health insurance companies use these limits as part of their marketing strategy."

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