1:5 Health Insurance Plans

• Health care costs are rising faster than other costs of living

• Most people rely on health insurance plans to pay for health care costs

• Without insurance, the cost of an illness can become a financial disaster

Types of Plans• Health insurance plans

– Offered by thousands of insurance agencies• Premium or fee the individual pays for insurance coverage, is

made to the insurance co

Insurance Terminology• Deductible

– amounts that must be paidby the insured individual for medical

• Co-insurance– requires that specific per centages of expenses are

shared by indi vidual and company• Co-payment

– Specific amount of money patient pays for a particular service

– Example: $10 for each physician visit regardless of total cost of visit

Types of Plans• Health maintenance organization

(HMO)– Most pay for total health care including routine

examinations & preventive type health care ( not usually covered by other plans)

– Advantages– Disadvantages

• Preferred provider organization (PPO)– Another type of managed care insurance plan– Usually provided by large companies or industry– Contracts with certain HC agencies– Usually requires a deductible & copayment

Types of Plans• Medicare ( Three types of coverage)

1. Type A ( covers hospital, ECF & Hospice )

2. Type B ( covers doctor’s svcs, Output tx, lab, etc.. Individual pays premium ( 80/20) co-insurance

3. Type D (assists with pharmaceutical (medications) expenses

• Medigap– Health insurance plans that help pay

expenses not covered by Medicare

Types of Plans(continued)• Medicaid

– Medical assistance program that is jointly funded by the federal government and state governments but Operated by individual states

– Benefits may vary from state to state– Usually covers individuals with low incomes, children who qualify for public

assistance, and individuals who are physically disabled or blind– Generally, all state Medicaid programs provide hospital services, physician's care,

long-term care services, and some therapies– Some states provide dental care, eye care, and other specialized services

• The State Children’s Health Insurance Program (SCHIP)• Worker’s Compensation• U.S. government plans for all military personnel and

their families– TRICARE ( formerly called CHAMPUS)

Types of Plans(continued)

Managed care plans• Developed because of the rising cost of health care• HMOs and PPOs are the main providers• Principle is that all health care provided to a patient must

have a purpose– Provide quality care at lowest possible cost

• Second opinion or verification of need is fre quently required• Usually provides routine physical examina tions, well-baby

care, immunizations, and wellness education to promote good nutri tion, exercise, weight control, and healthy living practices

• Employers and insurance companies create a network of doctors, specialists, therapists, and health care facilities that will provide care at the most reasonable cost

HIPAAHealth Insurance Portability & Accountability Act of 1996

Five components1. Health care access2. Preventing health care fraud3. Tax-related health provisions4. Application and enforcement of group health plan

requirements• Establishes standards that require group health care

plans to offer portability, access, andrenewability to all members of the group

5. Revenue offsets• provides changes to the Internal Revenue Code

for HIPAA expenses Compliance with all HIPAA regulations was required by April 2004 for all health care agencies