Institute:Office of National Coordinator (ONC) Workforce Training Curriculum
Component:Introduction to Health Care and Public Health in the U.S.
Unit:Financing Health Care - Part 1
Lecture:The history of the health insurance industry in the U.S.
Slide content:Health Maintenance Organization Act of 1973 Federal grants and loans to encourage HMOs Required employers offering traditional health plans to offer HMO option HMOs thought to lower costs Gave pre-paid health plans access to the employer-based insurance market 14
Slide notes:Due to rising health care expenditures in the late 1960s, the Health Maintenance Organization, or HMO, Act of 1973 was passed into law in an attempt to lower rising health care costs . The law provided federal grants and loans to encourage the development of HMOs, and required employers with twenty-five or more employees that offered traditional health plans to also offer an HMO option . HMOs were thought to lower costs by offering comprehensive hospital and physician services through a limited group of health care providers . The law allowed prepaid health plan companies access to the employer-based insurance market, which led to the development of todays managed care organizations and techniques. 14