Explain why HMOs are viewed as a more cost-effective way of practicing medicine than the traditional fee-for-service systems
The HMO idea is viewed as a fixed cost to the consumer with the health care insurer and health care provider as one and the same. This model is viewed as a more cost-effective way of practicing medicine as compared to the traditional fee-for-service plan. Prepaid group health plans emphasize health promotion because they provide health care services at a preset cost. By keeping people healthy, HMOs avoid the need for lengthy hospitalizations and costly services. Because HMOs make money by keeping you healthy, they have a greater stake in your wellness.
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