Chapter 47: Medical Insurance

What is capitation?

A set payment provided by managed care insurance per patient per month regardless of the amount of care a patient receives

What organization first started capitation?

Kaiser Permanente

What were the two programs created by the federal government to try and close the large gaps in medical coverage? Who is covered under both?

Medicare: For the elderly, the disabled, and those with end-stage kidney disease.

Medicaid: For low-income individuals and families.

What is TRICARE? Who does it cover?

A government insurance plan providing medical care to spouses and dependents of active duty military

What is CHAMPVA? Who does it cover?

Health insurance program that covers dependents of military veterans with service-connected disabilities

p.s: the acronym stands for Civilian Health And Medical Program of the department of Veterans' Affairs.

What is a group plan/group insurance? Who does it cover?

One insurance policy that covers a group of people

Define the following health insurance term:

Premium

The amount of money paid by the consumer to purchase health insurance

Define the following health insurance term:

Benefit

Payment for a service covered by health insurance

Define the following health insurance term:

Beneficiary

Each individual covered by the health insurance plan

Define the following health insurance term:

Insured

The person who is covered by a specific insurance plan

Define the following health insurance term:

Deductible

An amount of money that an insured person must pay for medical services annually before those services are covered by an insurance plan

Define the following health insurance term:

Coinsurance

A percentage of the allowed charge for health services that the patient must pay

Define the following health insurance term:

Copayment

A fixed amount of money that the patient must pay for certain health care services

What is primary insurance?

The insurance company that must be billed first for a given individual

What is secondary insurance?

Insurance that an individual has in addition to primary insurance

What is coordination of benefits?

Rules followed by insurance com­panies so that no claim is reimbursed at more than 100% of the charges

What type of household would follow these rules?

If both members of a couple have insurance with coordination of benefits

Briefly describe the 5 rules under coordination of benefits.

1. If the employee is the patient, their insurance is primary, and the spouse's or partner's insurance is secondary, covering any remaining costs.

2. For children, the "birthday rule" applies: the parent whose birthday is earlier in the year has the primary insurance.

3. For divorced parents, the parent designated as the "responsible party" by the court has primary insurance. If no court ruling exists, the custodial parent's insurance is primary, or the birthday rule applies.

4. Households with two working adults can avoid coordination issues by modifying benefits, such as choosing one policy for family coverage or opting for cash if already covered elsewhere.

5. If a Medicare recipient has employer insurance, the employer's policy is primary, and Medicare is secondary. Supplemental insurance for Medicare also acts as secondary coverage.

What is managed care?

A movement in healthcare focused on reducing costs while maintaining quality care

Define primary care provider (PCP)

The physician chosen by a patient to provide general care and authorize any additional medical services needed

In the original HMO concept, all medical care was provided for 1 year for a fixed premium, with no deductibles or coinsurance.

The patient was only responsible for what?

For a fixed amount for each visit or prescription (copayment)

In this model, who acts as the gatekeepers before any referrals to specialists are approved?

PCPs, including physicians, nurse practitioners, and physician assistants

PPOs allow in and out of network services.

At what cost is this to the patient though?

Patients pay a copayment or percentage for in-network costs, but a higher percentage for out-of-network costs

What is a point-of-service plan? It is a combination of what?

Type of health insurance that combines both HMO and PPO

What are the details of Medicare Part A, Part B, Part C, and Part D?

Medicare Part A: Hospital Insurance

• Covers:

  • Inpatient hospital stays

  • Skilled nursing facility care (after hospital)

  • Hospice and some home health care

  Cost:

  • No premium for most

  • Annual deductible

Medicare Part B: Medical Insurance

• Covers:

  • Outpatient care (doctor visits, lab tests)

  • Preventive services (vaccines, screenings)

  • Durable medical equipment (e.g., wheelchairs)

  Cost:

  • Monthly premium

  • Annual deductible + 20% coinsurance

Medicare Part C: Medicare Advantage

• Covers:

  • Combines Part A & B

  • Often includes Part D (prescriptions), dental, vision, etc.

• Cost

  • Premiums (in addition to Part B)

  • Varies by plan

Medicare Part D: Prescription Drug Coverage

• Covers:

  • Prescription medications

• Cost:

  • Monthly premium

  • Co-pays for prescriptions

Which part has a premium?

Medicare Part B and D

Patients with original Medicare can purchase additional insurance, known as Medicare supplemental or Medigap insurance. Which is billed as primary, Medicare or the supplemental?

Medicare

Only children enrolled in which government program can be enrolled into CHIP?

In the state's Medicaid plan, a separate CHIP program, or a combination of the two

What is TRICARE Prime?

An HMO-type plan available to service members, reservists, dependents, and some retirees.

What is eligibility status and why is it so important to check prior to an office visit?

To determine whether the patient has health insurance coverage and will be able to receive health insurance benefits during the proposed time period

What is a referral?

The primary care physician refers the patient to a specialist, often requiring prior authorization from managed care or other insurance plans

What type of services would a PCP complete a referral for a patient?

Physical therapy

On the lower lines of the claim form, there is information on the charges for services rendered.

What information should be included for these charges?

Date of service, place of service, pointer to the procedure code, charge for the service, number of units being billed, and NPI number of the provider of each service