managed care, a health care system with administrative control over primary health care services in a medical group practice. The intention is to eliminate redundant facilities and services and to reduce costs. Health education and preventive medicine are emphasized. Patients may pay a flat fee for basic family care but may be charged additional fees for secondary care services. The system of managed care evolved after World War II from the traditional fee for service, in which the patient paid the physician directly for services performed; through a shift toward health insurance organizations, which paid physicians and hospitals from premiums paid by the patients to the insurers; to the advent in the 1960s of government programs, such as Medicare and Medicaid. In the 1980s another economic shift, originating in California, led to the concept of health maintenance organizations (HMOs), with large corporations initially negotiating with groups of health care workers for financing of medical and hospital expenses of the corporation’s employees. HMOs also began enrolling individual patients and by the mid-1990s challenged the survival of the traditional insurance systems. See also health maintenance organization.
