Which of the following is a component of managed care in PMI?

Paid referrals and treatment reviews are integral components of managed care in Private Medical Insurance (PMI). Managed care aims to provide cost-effective healthcare services while maintaining quality. To achieve this, it employs a structured approach that includes pre-authorization for treatments and referrals to specialists. This ensures that care is necessary and appropriate, thus helping to manage costs and outcomes effectively.

The system typically involves a network of providers that insurers negotiate rates with, providing controlled access to necessary medical services. The requirement for referrals not only streamlines the process but also allows for assessment of the treatment's necessity before it is approved, further ensuring that patients receive appropriate care without unnecessary expenses.

In contrast, unlimited access to all medical facilities undermines the managed care principle of cost control and provider network management. Self-selected specialist options would allow patients to bypass the referral process, which is contrary to the managed care model designed to regulate access to care. Direct insurance payments to all healthcare providers could lead to unregulated costs and undermines the negotiated contracts that are fundamental to managed care arrangements.