As the CFO of Seamus Company, my main concern is to focus on its vision and mission. The Managed Care Organization (MCO) is a model contrary to the fee-for-service model that struggles to decrease costs without conceding health care. The MCO model helps to reduce costs through substantial utilization reviews, impatient control, and providing different contractual levels for physicians. There are three strategies that Seamus Company would adopt when moving to the MCO model.
The first is the Health Maintenance Organization (HMO), which assembles all healthcare evaluations to the gatekeeper provider/physician responsible for providing direct care to the patients (Vander-Laan et al., 1998) . In terms of cost-saving, the direct caregiver initiates referrals or any other specialties. The strategy is associated with few or no tax-deductible considerations. Other tax advantages, if any, are few. In terms of improving fiscal management, the HMO minimizes specialty physicians' exploitation, which might lower the costs.
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The second strategy is the Preferred Provider Organization (PPO), which adheres to a stringent network that will discount or deny payment for all the services by providers who have not subscribed to the PPO plan. The plan will less probably cover preventative services. Like the HMO, the strategy is associated with few or no tax-deductible considerations; other tax advantages, if any, are few (Vander-Laan et al., 1998) . The PPO model allows patients to see any care provider of their choice, which is the primary fiscal management improvement. The third strategy is the High Deductible Health Plan (HDHP), which covers 100 percent of all costs. Regarding cost-saving-measures, employees should meet a specific high deductible sum before coverage by insurance plan.
The two major financial principles are Costs and Control. In this perspective, the cost is the expense that Seamus undergoes to perform its normal operations ( Titman et al., 2011) . If the costs exceed revenue, the business will fail, but if the costs are continuously contained, it will maintain its profitable status. The second aspect, control, form the basis of the company. To protect the resources and finances of the company, Seamus has instigated stringent policies. Once Seamus moves from fee-for-service to MCO model, costs and control will be impacted significantly. Selecting the Zia Health PPO plan ensures that Seamus can incur lesser costs of health insurance paid out for workers. It will provide an opportunity for all the workers to minimize expenses or risk of denied payments from a non-participating physician ( Titman et al., 2011) . By cost reduction, control will be impacted beneficially. As health plan costs are reduced, some cash will be freed and allocated to other areas.
Various benefits and drawbacks are associated with the improved service benefits for the Seamus Company. The insurer carries the impact of the risk of utilization since care providers are only paid the services they render. The shift to the PPO plan will imply that the company will concede a significant measure of the exploitation risk to the healthcare owing to the observance of basic care plans and pre-authorizations (Kerrigan et al., 2005) . With the adoption of the PPO, Seamus Company will experience financial benefits. The benefits include telegraph services, discounted gym, provision of preventive healthcare, and cost reduction. Preventive healthcare will ensure that employees are more mindful of their health, which will reduce the number of reported illnesses.
The implementation, however, also has certain drawbacks. First, employees are responsible for their health and might only choose to utilize preventive healthcare service. Initially, this sounds like a cost-reduction technique, but lack of continuous follow up complicates the health situation. For example, if the primary care provider refers the patient to a specialist for a serious complication, and the employee chooses not to heed to the commendations, the situation will deteriorate. Inexorably, the worker will experience declination of health to the point of seeking costly inpatient services. With the PPO model offering preventive services without any costs to the employee, there lacks any room for abuse since the employee might overuse the benefits (Kerrigan et al., 2005) . This generates a moral risk problem because the employees do not incur any cost to access the services. Weighing from the information provided, the benefits of transitioning from fee-for-service to the PPO plan has more benefits than the risks. Studies show that the benefits increase the morale and productivity of the employees. At the same time, the plan decreases the sic time from the company.
When incorporated into the Seamus Company, external partnerships will have both benefits and drawbacks. Examples of the partnerships include designated outpatient high-cost diagnostic imaging and gym memberships. For most employees, the gym is cost-prohibitive. By offering free or reduced membership, more employees would be available. Being a specialized facility, the imaging center can control costs by emphasizing on elemental supplies that are coherent with the performed supplies ( Harrison, & St. John, 1996) . The partnerships also have certain drawbacks. In an instance where the employees register but fail to utilize the membership, the company would be incurring costs. The disadvantage of partnering with an external imaging center is the location and the ability to provide timely results. Non-compliance might result if the location is not proximal to the employees’ home or the direct care physician. Delay in communicating the results to the physician increases the risk to the employees.
Although the gym has an overall great impact on the health of the employee, most workers might accept membership but fail to utilize it. The company has first to engage the employee s and educate them on the importance of leading healthier lifestyles. Partnering with an external imaging center would be beneficial to the company. Evidence shows that having a specialized center does all the advanced diagnostic imaging is more economical than when done within the hospital ( Harrison & St. John, 1996) . The external partnership would be partially beneficial, having considered all the cases.
As the Chief Financial officer, I have weighed all the options and put them into creative consideration. I would recommend that Seamus transitions to the PPO plan for all the employees. The PPO plan will incorporate and emphasize preventive healthcare, including vaccinations, laboratory services, and routine physical examinations. The plan seeks to provide reduced gym membership. Focus groups will also be formed to promote friendly contests and group exercising. The value of incorporating an external imaging center to reduce diagnostic costs will also be considered. Shifting from the fee-for-service plan to the PPO will provide improved care to the employees and lead to cost reduction for Seamus Company.
References
Harrison, J. S., & St. John, C. H. (1996). Managing and partnering with external stakeholders. Academy of Management Perspectives , 10 (2), 46-60.
Kerrigan, M., Howlader, N., Mandelson, M. T., Harrison, R., Mansley, E. C., & Ramsey, S. D. (2005). Costs and survival of patients with colorectal cancer in a health maintenance organization and a preferred provider organization. Medical care , 1043-1048.
Titman, S., Keown, A. J., Martin, J. D., & Martin, T. (2011). Financial management: Principles and applications (Vol. 11). Boston: Prentice-Hall.
VanderLaan, B., Karande, V., Krohm, C., Morris, R., Pratt, D., & Gleicher, N. (1998). Cost considerations with infertility therapy: outcome and cost comparison between health maintenance organization and preferred provider organization care based on physician and facility cost. Human reproduction (Oxford, England) , 13 (5), 1200-1205.
