Home Degrees for a Career in Managed Care Administration

Degrees for a Career in Managed Care Administration

Insurance and compensation for healthcare services is a subject that almost no one in the United States is excited to talk about. It’s not hard to find the reasons why: despite healthcare expenditures towering above those of other developed countries, reaching almost 18 percent of GDP, Americans experience lower life expectancy and higher mortality rates from universal threats like diabetes, heart attacks, and childbirth.

In 2019, the average American spent more than $10,000 on healthcare. By 2023, that number is expected to rise closer to $15,000. The administrative costs are nearly $1,000 per person… compared to Germany’s $293 or France’s $289.

And everyone, from politicians down to individual patients, is uncomfortable with the reality that there are fiscal limits on how society cares for the sick and injured.

Managed care administrators find themselves at the crossroads of these thorny topics. They are the ones responsible for figuring out how to structure insurance and reimbursement rates in a way that keeps insurers and doctors from going broke while still ensuring patients get a sufficient level of care that meets not just their standards, but the general societal standards of what 21st century healthcare should look like. And they do it not just by crunching numbers, but also by figuring out more effective treatment methods, preventative care, and lifestyle paths that can reduce the cost of care while improving overall health for their subscribers.

That innovation may represent the future of American healthcare. An insurer in Reno, Nevada, explored the idea of offering a free gym membership and personal trainer to select members to promote exercise and a healthier lifestyle to decrease long-term medical expenditures. In a 2017 study of the outcomes, a significant percentage of the participating members had lowered their body mass index and had a significant decrease in the amount and cost of medications being taken… savings that show up in the company’s bottom line.

If solving those kinds of complex problems, saving money and lives at the same time, is something you have the talent and interests to accomplish, then the managed care industry could be a very welcome home for your administration skills.

How is Managed Care Administration Different From Other Healthcare Administration Jobs?

Managed care plans are all about efficiency and looking forward. That doesn’t mean shirking on quality healthcare—in fact, it can be exactly the opposite, since encouraging low-cost preventive care can often reduce major expenses on treating easily-prevented diseases that are allowed to get out of hand.

Managed care organizations can take advantage of those forward-looking programs to nudge participants into patterns that will be healthier, and therefore less costly, going forward. It’s a win/win for patients and insurers alike. Incentivizing patients to take proactive steps to keep themselves healthy, and the cost savings that comes with it, has proven to be a magic combination that is making the managed care model a very popular concept in American healthcare today.

In the private sector, Health Maintenance Organizations, which develop their own networks of doctors, hospitals, and healthcare providers who operate under fixed contracts, started to become popular in the early 1970s with the passage of the Health Maintenance Organization Act of 1973. Preferred Provider Organizations offer another vision of managed care, with a less structured implementation of the same idea. In the public sector, although most people outside the industry don’t think of them that way, Medicare and Medicaid represent the largest managed care organizations in the country.

Managed care administrators can work in any of these organizations, and, of course, in the hospitals or healthcare provider organizations that contract with them. Coordinating all those providers and members is a big job. Their work consists of putting together the contracts that govern the provider/insurer relationship, administering those contracts, monitoring the financial and healthcare outcomes that result from them, and making adjustments going forward. They also calculate and arbitrate the reduced compensation and member payment responsibilities for out-of-network visits.

As with all administrative roles, this necessarily involves a lot of data and paperwork, and you can expect to spend plenty of time staring at spreadsheets, sitting in meetings, and engaged in phone calls with providers and vendors to get all the inevitable kinks straightened out.

That requires a sort of general education that covers the spectrum of business and financial training with a strong dose of healthcare industry domain knowledge. And it definitely calls for a college degree.

Bachelor’s and Master’s Degree Options for a Career in Managed Care Administration

HMOs aren’t overly restrictive in the degrees they will accept from candidates vying for administrative positions. As long as your program covers all relevant general business topics, along with economics and business finance, regulations and ethics, and informatics all in the context of healthcare, the specific degree focus doesn’t really matter that much. Whether your degree happens to be in healthcare administration specifically or not, you’ll have plenty of opportunities. That means you can also consider degree such as:

  • Business Administration with Healthcare Concentration
  • Public Health
  • Health Services Management
  • Public Administration with Healthcare Concentration

You’ll also find that you can get started in managed care administration with a variety of different levels of education.

Bachelor’s Degrees Open The Door in Managed Care Administration

A four-year bachelor’s degree is the most practical entry-level degree in the industry. Although you can find two-year associate’s programs in these majors, most of them exist to serve as transfer programs that allow you to fulfill the first two years of a bachelor’s education closer to home and at a reduced cost from a full-fledged university program.

Either way, the full bachelor’s degree will give you the foundations you need to both get hired and to make a real impact at a managed care organization. It will deliver courses in all the subject areas listed above, plus a wide array of general education studies… things like communications, social studies, languages, and history.

At first glance, it may seem like those don’t have a lot to do with managed care, but the real point of an American bachelor’s degree is to create well-rounded graduates with exposure to different perspectives and ideas to build problem-solving and critical-thinking skills that let them field any new challenge that comes their way. That’s a valuable talent for any industry, a critical one if you want to work in managed care.

MHA, and Other Master’s and Doctorates are Appropriate for Top Executive Roles in Managed Care Administration

A bachelor’s is just the minimum for getting into managed care administration, however. If you want to sit at the big table, making the big decisions in the industry as a top executive, you need more in-depth and more specialized knowledge… the kind that only comes with a master’s degree or even a doctorate in the field.

Master of Health Administration (MHA) and other graduate programs in the field build on the foundation you got at the bachelor’s level to add entirely new levels of competency to your game. You will learn from the top instructors in the field, participate in internships in some of the biggest healthcare organizations in the country, and delve into ideas and questions at the cutting-edge of modern healthcare administration.

Graduate degrees also give you more opportunity to chart your own course at this level, selecting your own research topics and building out either a thesis, dissertation, or capstone project that is structured around your interests and findings. It’s the kind of master-class in the industry that the biggest and best HMOs and PPOs expect their senior executive hires to have.

Standard Health Administration Curriculum is the Perfect Preparation for a Career in Managed Care Administration

The ideal degree for managed care administrators is undoubtedly in the major of healthcare administration. These programs check all the right boxes with a curriculum heavy in concepts that align perfectly with the work administrators do in the managed care setting every day:

General Business Knowledge – Careers in managed care involve working on the business side of the healthcare industry, which means that general business knowledge covering operations, human resources administration, organizational theory, and management are all concepts you will rely on daily. You need a strong business footing to succeed in this field.

Healthcare Industry Economics and Financial Training – Managed care is all about finding efficiencies in healthcare delivery. You can’t find those efficiencies if you can’t calculate the relative costs and don’t understand how the economics of the industry work, so you need to find a program that dives into the twists and turns of healthcare financing and reimbursement in America, covering both public and private revenue sources and operating expenses.

Health Care Marketing – HMOs and PPOs operate in an increasingly competitive environment, fueled in part by the broadening ACA healthcare exchanges. Since your organization won’t be the only game in town, you’ll need to understand how it can best represent itself to not just individual patients, but also to the providers who you will need to sign up to build out strong networks of care that are attractive to new customers.

Legal and Ethical Considerations in Healthcare – The intersection of money and health is always one that is fraught with the potential for abuses or inequities. Both from a regulatory standpoint and from the basic ethical stance of right and wrong, you’ll need training in how to walk the fine line between keeping your organization profitable and providing the highest and best standards of care in your agreements with providers.

Healthcare Information Management and Informatics – The degree to which every other aspect of managed care is affected by information technology and big data today can’t be overstated: it’s a revolution in the industry that is changing how the totality of care is measured and understood, and opening up new opportunities for driving business and treatment efficiencies. Graduates going into managed care organizations can’t settle for anything less than the most cutting-edge education in healthcare informatics so they can better understand the language of data and how it can inform big decisions. On the other side of the technology coin and as a purely practical matter, being familiar with the way patient records are created and stored through the process of health information management is key to understanding modern patient privacy concerns in the context of HIPAA regulations.

Specialty Accreditation for Managed Care Administration Degrees

One thing to consider for any degree you choose is whether the program or the specific university department or school holds a specialty accreditation that lines up with the subject being taught. That means getting the seal of approval from one or more of these organizations:

While just about every American university already holds a solid institution-level accreditation that establishes its basic academic and administrative capacities, these organizations are recognized by the Department of Education as having the credentials to evaluate individual departments and programs, focusing specifically on the specialized curriculum in those majors. They work with active industry groups and professionals to ensure that the instructors have the right qualifications, the curriculum lines up with modern business expectations, and that the resources available will get you set on the right track to hit the ground running at an HMO after graduation.

Are Online Degrees Okay For Managed Care Administration Degrees?

You’ll have no problem these days finding degree options that are offered entirely online. The real question is, should you take advantage of them?

Though some people learn better in traditional residential degree programs, in the disciplined atmosphere of the lecture hall, with in-person access to instructors and fellow students, that is a sentiment that is largely giving way to the practicality, safety and convenience of remote programs. In the post-COVID era as universities worked diligently to roll out online options for even the most traditional on-campus legacy programs, it’s becoming an easier decision to make.

If you have the self-discipline and the high-speed internet access, though, online programs have proven themselves to be fully equal to any traditional degree plan over the past decade. Advances in technology and in teaching styles and expertise have made the full array of educational experiences available online, from real-time streaming lectures to group chats to asynchronous recorded lessons and assignments you can tackle on your own time.

Online programs offer an enormous amount of flexibility and personal preference to the college experience. You can study when and where you prefer, without uprooting your life to relocate to a college town, or making compromises in your current career path or your family life. An online program can get you to the same destination with a lot less hassle than traditional degrees.

Managed Care Administrator Salary and Career Outlook

Managed care has come to dominate the American healthcare landscape. That means you aren’t going to find any shortage of jobs in the field in the coming years, with major demographic pressures like the aging Baby Boom generation and new scientific advances in treatment options both driving a huge demand for healthcare services… the health and medical insurance market in the country is forecast to have expanded 6.7 percent in 2020 alone, and has a track record of growing at more than 5 percent per year over the past five years.

That translates into enormously strong demand forecasts for professional medical and health services managers. The Bureau of Labor Statistics, which tracks that category of employment, estimates that the number of positions will expand by an amazing 32 percent between 2019 and 2029.

Salary Prospects for Managed Care Administrators

BLS also finds that those jobs are pretty well-compensated, with a median salary of $100,980 as of 2019. But that just represents the broadest swath of health services managers.

Specialists in managed care administration can expect to bring in much higher paychecks. According to a 2019 survey published by Crain in Modern Healthcare on executive compensation in healthcare organizations, managed care executives averaged $312,100 in base pay, and $364,100 in total compensation, including bonuses. That represented a nearly five percent bump over the median compensation from the previous year.

Of course, those are averages pulled from the private sector. Many managed care executives will find themselves working in government service, however, in the vast machinery that governs Medicare and Medicaid. That can mean working for federal or state government agencies, performing the same types of tasks as your private sector counterparts.

It’s true that those jobs will offer lower salaries… the federal General Schedule that governs all official positions starts master’s-educated graduates off in the GS-9 range that can be between $45,627 and $59,613, for instance. BLS data shows that administrative service manages working in state government averaged $92,370, on the other hand.

And the federal rates are subject to adjustments based on location… as high as a 40% increase based on local cost-of-living considerations:

  • New York : 31.2%
  • Los Angeles : 29.65%
  • Chicago : 26.85%
  • Dallas : 22.61%
  • Miami : 22.13%
  • St. Louis : 15.83%
  • Atlanta : 20.7%
  • Seattle : 24.24%

Plus, the kind of job security and benefits that come with government jobs are almost impossible to find in the private sector. So you might well decide a managed care position in government is well worth the trade-offs, depending on your individual goals.

Whatever your chosen path, you can help forge the future of American healthcare with a career in managed care administration… and secure your own future and prosperity at the same time.