Final answer:
Health care managers are key in managing and coordinating health services, dealing with various healthcare financing models like fee-for-service and HMOs, and addressing insurance market challenges such as adverse selection and moral hazard.
Step-by-step explanation:
Health care managers are primarily needed to manage and coordinate various types of health care services. Their role encompasses overseeing different functions of healthcare facilities, including but not limited to, human resources, general administration, marketing and sales, finance, and direct healthcare services such as nursing or therapy. With the shift towards efficiency models, such as the growth of health maintenance organizations (HMOs), the need for effective healthcare management has intensified to ensure both quality care and cost-effectiveness.
In healthcare financing systems, like the fee-for-service model, providers are reimbursed for the individual services they deliver. Conversely, HMOs reimburse providers with a fixed amount per patient, which requires careful allocation of resources to balance patient care with cost control. Healthcare managers must also address the insurance market's challenge of adverse selection, where insurers risk attracting a disproportionate number of high-risk patients.
As healthcare managers aim to reduce the moral hazard in healthcare provision, they implement incentives for providers to offer essential care without overutilizing services. This requires managers to balance financial items with healthcare incentives to maintain a sustainable and efficient healthcare delivery system.