Health Insurance Essentials Chapter 12

The Purpose of Health Insurance

• helps individuals and families offset costs of medical care

• defined as a contract for protection against financial losses resulting from illness or injury

• provides payment of monetary benefits for covered sickness or injury, depending on policy purchased

• policy is purchased with a premium or payment

Cost- sharing

most policies require patient to pay a portion of healthcare expenses

Includes:

• Deductible: a set dollar amount that the policyholder must pay before the insurance company starts to pay for services

• Co-insurance: kicks in after the deductible has been met. is usually a percentage (ie. 20%) that the policyholder is responsible to pay

• Copayment: is a set dollar amount that the policyholder must pay for each office visit

Benefits

this is the amount payable by an insurance company for a monetary loss to an individual insured by that company, under each coverage

what’s covered or what can i do with this insurance is called “benefits”

10 categories of essential health benefits:

• ambulatory patient services

• hospitalization

• mental health and substance use disorder services

• prescription drugs

• preventative and wellness services; chronic disease management

• emergency services

• maternity and newborn care

• rehabilitative and habilitative services and devices

• laboratory services

• pediatric services, including oral and vision care

Health Insurance Plans

• two types of health insurance plans in the United States:

  • government health insurance plans

  • private health insurance plans

• Medically necessary services are those that are necessary to improve patient’s current health

• Elective procedures: medical procedures that are not deemed medically necessary

Preventative Care Services

• alcohol misuse screening

• blood pressure screening

• cholesterol screening

• colorectal screening

• depression screening

• diabetes (type 2) screening

• diet counseling

• hepatitis B and C screening

• human immunodeficiency virus (HIV) screening

• immunization vaccines

• lung cancer screening

• obesity screening and counseling

• tobacco use screening

• sexually transmitted infection (STI) prevention counseling

Government Health Insurance Plans

• patients need to qualify by:

  • age

  • income

  • government occupation

  • health condition

• patient who is 65 or older can qualify for Medicare

• low income patient may be eligible for Medicaid or MediCal

• dependents of military personnel are covered by TRICARE

Medicare

• federal health insurance program that provides healthcare coverage for individuals who are age 65 or older; people who are disabled, and patients who have been diagnosed with end-stage renal disease (ESRD)

• four parts:

  • Part A: Inpatient hospital charges

  • Part B: Ambulatory care (covers 80% after met deductible)

  • Part C: Option for medicare-qualified patients

  • Part D: Prescription drug program

Medicaid

• government program that provides medical care for indigent

• funded by federal and state governments

• mandatory medicaid benefits:

  • inpatient and outpatient hospital services

  • nursing facility and home health services

  • early and periodic screening

  • physician services

  • rural health clinic services

  • family planning services

  • transportation to medical care

• eligibility is determined by respective states; most medicaid recipients are:

  • low-income families

  • qualified pregnant women and children

  • recipients of Temporary Assistance for Needy Families (TANF)

  • individuals who receive Supplemental Security Income (SSI)

  • Individuals who receive certain types of federal and state aid

  • Individuals who are Qualified Medicare Beneficiaries (QMBs)

  • Individuals in institutions or receiving long-term care

Government managed care plans

• medicare and many medicaid programs offer their members an option to join a managed care plan

• identification cards will look just like ones issued to people not on Medicare or Medicaid

• may have a copayment that patient would be responsible for

TRICARE

• comprehensive healthcare program for uniformed service members and retirees and their families

• managed by military in partnership with civilian hospital and clinics

• designed to:

  • expand access to health care

  • ensure high-quality care

  • promote medical readiness

Civilian Health and Medical Program of the Veterans Administration

• health benefits program similar to TRICARE

• provides coverage for families of veterans who were permanently disabled or killed in the line of duty

• department of Veterans Affairs (VA) shares costs of certain healthcare services and supplies with eligible beneficiaries

Private Health Insurance Plans

• Employer group plans: plans offered usually at a reduced premium for all qualified employees

• Self-funded group health plans: when an organization funds their own insurance program and offers it to their employees

• Individual health insurance plans: an individual health insurance plan is one that is not offered by an employer or another group

Capitation

a payment method in which providers are paid for each individual enrolled in a plan, regardless of whether the person sees the provider that month

• ensures adequate care for only necessary procedures

Managed Care Organizations

• health insurance companies whose goal is to provide quality, cost-effective care to its members

• negotiate reduced rates with contracted providers and hospitals

• many require patient to choose a primary care provider (PCP)

• require referrals

• preauthorization process can further control patient care

Models of Managed Care Organizations

• patient care is coordinated through network of providers and hospitals

• Types:

  • Health maintenance organizations- HMO

  • Preferred provider organizations- PPO

  • Exclusive provider organizations- EPO

Health Maintenance Organizations (HMOs)

• health plans that are regulated by HMO laws

• goal is to reduce cost of health care while still providing quality health care

• typically have lowest monthly premiums; low out-of-pocket expenses

• patients have to pick a PCP

• Insurance plan will not pay for services that are not included in its provider network

Preferred Provider Organizations (PPOs)

• managed care network that contracts with a group of providers

  • agree on a predetermined list of charged for all services

• uses fee-for-service concept

• typically patient’s financial responsibilities are 20% to 25% of allowed charge

Exclusive Provider Organizations (EPOs)

• combines features of an HMO and a PPO

• patients with EPO will not be covered for services outside designated network of providers

  • may not need to obtain a referral for specialized care

• EPO plan members not required to choose a PCP

Referrals

Three types:

• regular referral: 3 to 10 working days

• urgent referral: about 24 hours

• STAT referral: can be approved online; emergency

Utilization Management/Utilization Review

• Utilization management: form of patient care review by healthcare professionals who do not provide the care but are employed by health insurance companies

• Utilization review committee: reviews individual cases to ensure medical care services are medically necessary

Precertification/Preauthorization

• to obtain precertification, the medical assistant:

  • calls the provider services phone number on back of patient’s health insurance ID card

  • provides insurance company with procedures and/or services requested and the diagnoses

  • documents the outcome of call in patient’s health record, including precertification number

Example: MRI, CT

Participating Provider Contracts

• with all government health plans and most private health plans, healthcare providers must become participating providers (PARs)

• healthcare providers can apply to become PARs through a process called credentialing

• once healthcare provider is credentialed, health insurance plan issues contract to become an in-network PAR

Health Insurance Identification Card

Supplies:

• health insurance company

• health plan name and type

• subscriber’s name and covered dependents

• subscriber’s identification number

• copay amounts

• policy group number

• health plan contact phone number

Verifying Eligibility

• process of confirming health insurance coverage for patient

• medical assistant should gather health insurance information and verify effective date

  • Then, review each insurer’s online insurance Web portal

• Once approved, a patient’s benefits can be looked up in their entirety in seconds

Workers’ Compensation

insurance plan for individuals who are injured on the job or become ill due to job-related circumstances

Covers:

• medical care and rehabilitation benefits

• weekly income replacement benefits

• death benefits to dependents

Disability Insurance

• provides income replacement if patient has a disability that is not ]work related

• Short term disability:

  • unable to work 9 to 52 weeks

• Long term disability:

  • pick up when short-term benefits are exhausted

  • pay out until patient returns to work or for number of years specified in policy

Long-Term Care Insurance

• relatively new

• covers broad range of maintenance and health services for chronically ill, disabled, or developmentally delayed individuals

• medical services may be provided on inpatient or outpatient basis, or at home

The Affordable Care Act

• enacted in 2010

• increased quality, availability, and affordability of private and public health insurance for more than 44 million uninsured Americans

• works to reduce overall healthcare spending in the long run

• insurance companies cannot drop patient’s health coverage if individual gets sick or makes unintentional mistake

• Pre existing conditions eliminated

Patient Coaching and Legal and Ethical Issues

• responsibilities include keeping patient informed and answering questions as they arise

• use good communication skills, patience, and tact when discussing third-party reimbursement issues with patients

• written release must be given for medical information to insurance claims processing