Standard 7.01 Classify types of health insurance and features
of types of coverage.
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Essential Questions What are the types of health insurance and
things to consider when selecting options?
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Handling Risk Individuals handle risk in three ways: 1.Prepare
to bear the costs themselves. 2.Use safety and avoidance measures
to try to avoid costly incidents. 3.Transfer risks to another party
by purchasing insurance policies.
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Insurance is a risk-management technique, an arrangement in
which an insured pays money to an insurer to gain protection
against risks and compensation for loses.
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Types of Coverage Medical benefits Pay a large part of hospital
and surgical care, may also pay part of some other medical expenses
(doctors visits) Major Medical Pays for long-term illness expenses
after basic medical benefits limits have been reached (cancer)
Dental Insurance Covers all/part of routine services (examination
cleanings, Xrays) and some other procedures Vision Benefits May
cover all or part of eye examinations, glasess, and contact
lens
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Vision Insurance Dental Insurance Medical Benefits Major
Medical
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Types of Coverage Disability Insurance Supplies all/part of a
workers pay if unable to work due to illness or injury. Short term
vs. Long Term Often a waiting period before payments begin
Long-term care insurance Intended to cover the costs of extended
home nursing care and related expenses which are not covered by
regular medical benefits Accident Insurance Covers costs from
injuries that occur at an eligible location and/or time. Large
group rates keep costs low, but do not cover illness. Medigap
Insurance Private insurance available to citizens 65 and older who
have Medicare A and B plans. Covers the cost of co-payments and
deductibles.
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Disability Insurance Long-Term Care Insurance Accident
InsuranceMedigap Insurance
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Government Programs Medicare The federal government pays some
of the medical expenses of the elderly, ages 65 and over, and for
some people with disabilities. Client can choose managed Medicare
called Medicare Advantage or get fee-for service Medicaid State and
federal governments share the cost to pay certain medical bills for
low-income persons
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Government Programs Childrens Hospital Insurance Programs
(CHIP) Health insurance for children under eighteen whose parents
earn too much to qualify for Medicaid, but not enough to buy
private insurance. Federal funds are distributed by state programs
to cover costs. COBRA Consolidated Omnibus Budget Reconciliation
Act Gives the right to pay ones own premiums and continue
employer-sponsored group health insurance plan for a limited time
after leaving a job.
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Non- Government Programs Health Maintenance Organization (HMO)
A health care group that provides health care services to members
for a set fee and a small co-pay. Preferred Provider Organization
(PPO) An agreement between health providers with employers or
insurers to provide services at a reduced rate to employees.
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Non- Government Programs Point of Service (POS) Members use a
primary physician who refers them as needed to participating
specialist or members can see non-participating health providers.
But, members pay more to use non-participating health providers.
Fee for Services plan A plan in which an insured can select his/her
own doctors and hospitals, pay costs at time of visit, and file
form with insurance company for reimbursement of covered
expenses.
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Non- Government Programs Health Savings Account
Employer-sponsored plan where monies are automatically deposited
before taxes into a savings account to cover predicted medical,
dental, vision, and child care expenses for a twelve month period.
Monies not spent within the year are transferred to the savings
account provider.
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Seek the plan whose features best meets your needs Co-payments
The percentage of costs you pay once the deductible is met
Deductible The amount of medical expenses you pay each term
(usually one year) before insurance will cover any expenses. The
higher the deductible the lower the premiums Pre-existing
conditions Expenses that are not covered because they existed when
coverage began E.g. pregnancy expenses for 10 months after the
policy goes into effect Maximum benefit The maximum dollar amount
the insurance company will pay over the term and/or a lifetime.
Chiropractic care often has a term limit and cancer expenses often
have a lifetime limit.
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Seek the plan whose features best meets your needs Open
enrollment period The period of time during which a person whose is
eligible has to consider their options before enrolling without
cost increases or exclusions. Preauthorization Insurance approval
is required in advance for expensive and/or extensive tests,
treatments, and/or surgery. Exclusions Items that the insurance
policy will not cover E.g. cosmetic surgery, teen pregnancy, new
treatments that do not yet have FDA approval Renewability What
extenuating circumstances would cause the insurance company to not
renew your policy at the end of the policy contract period.
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Choosing a Health Care Plan Review several policies to
determine exclusions and deductibles Consider the costs Ask advice
from others who have used the plan Consider services that may/may
not be covered Office visits, medical tests, maternity care,
physical therapy, outpatient surgery, inpatient hospital services,
prescription drugs, preventative care, and home health care
