Can name some Can name some carriers/companies???carriers/companies???

http://www.healthinsurancesort.com/carrier-list.htm

Health InsuranceHealth InsuranceConsumer Health UnitConsumer Health Unit

ObjectivesObjectives::-TSWBAT differentiate between types of insurance TSWBAT differentiate between types of insurance

programs and terms.programs and terms.-TSWBAT analyze which health insurance plan TSWBAT analyze which health insurance plan

available would best fit the students’ needs. available would best fit the students’ needs.

JUMP STARTERJUMP STARTER

1. Why do you need health insurance?1. Why do you need health insurance?

2. What health insurance do you have?2. What health insurance do you have?

Why do I need health Why do I need health insurance?insurance?

PreventativePreventative

Well visitsWell visits Check upsCheck ups ImmunizationsImmunizations TestingTesting Prescriptive MedicinePrescriptive Medicine

PostPost

IllnessIllness Injury/ FracturesInjury/ Fractures Car accidentsCar accidents SurgerySurgery RehabilitationRehabilitation

Health InsuranceHealth Insurance

A person buys insurance and the A person buys insurance and the insurance provider agrees to pay or insurance provider agrees to pay or reimburse for the costs of medical carereimburse for the costs of medical care ““Gambling analogy”Gambling analogy” In 2006, 47 million people in the U.S. (16% of In 2006, 47 million people in the U.S. (16% of

the population) who the population) who were without were without health health insurance for at least part of that year insurance for at least part of that year

That number keeps That number keeps RISINGRISING each year each year

IntroductionIntroduction

What’s the #1 reason young adults end up What’s the #1 reason young adults end up in bankruptcy?in bankruptcy? Large, unexpected medical bills from Large, unexpected medical bills from

• an accidentan accident• an illness an illness

Combined withCombined with NO health insuranceNO health insurance

Why are they uninsured?

Insurance costs increase Insurance costs increase 10%-15% each year10%-15% each year

Other debts to pay firstOther debts to pay first• $20K in college loans$20K in college loans

Convoluted lingoConvoluted lingo ProcrastinationProcrastination Feel invincibleFeel invincible

In their own words

No one is making me pay for health insurance… No one is making me pay for health insurance… [someone is] making me pay for rent, cable, and [someone is] making me pay for rent, cable, and student loans. Insurance is the only thing I can student loans. Insurance is the only thing I can put off for a little while.”put off for a little while.” Nicole Ross, 21, a recent college graduateNicole Ross, 21, a recent college graduate

““Right now I have $300 to my name. I ate Right now I have $300 to my name. I ate Ramen noodles today. If you don’t have a job Ramen noodles today. If you don’t have a job yet, how do you even pay for it?”yet, how do you even pay for it?” Andrew Hoffman, a student at Coastal Carolina Andrew Hoffman, a student at Coastal Carolina

UniversityUniversity

Do you really need it?Do you really need it? YES!YES!

How much does a How much does a broken leg cost?broken leg cost? $5,000 - $20,000$5,000 - $20,000

How much does a How much does a serious car serious car accident cost?accident cost? $50,000$50,000

History of Health InsuranceHistory of Health Insurance Before the development of medical expense insurance, patients Before the development of medical expense insurance, patients

were expected to pay were expected to pay all all other health care costs out of their own other health care costs out of their own pockets pockets

Almost impossible now with the high cost of health careAlmost impossible now with the high cost of health care

First Accident insurance offered by:First Accident insurance offered by: Franklin Health Assurance Company Franklin Health Assurance Company of Massachusetts. of Massachusetts. Founded in Founded in 18501850, offered insurance against injuries arising from , offered insurance against injuries arising from

railroad and steamboat accidents railroad and steamboat accidents

The first employer-sponsored group disability policy was issued in The first employer-sponsored group disability policy was issued in 1911 1911

Group vs. Individual InsuranceGroup vs. Individual Insurance

Group PoliciesGroup Policies – – provided by employerprovided by employer you employer pays for you employer pays for

all or most of you all or most of you insurance plans costinsurance plans cost

All employees at work All employees at work have the have the same health same health insurance optionsinsurance options as as you doyou do

Commonly called Commonly called “benefits”“benefits”

Individual PoliciesIndividual Policies – – you buy the policy you buy the policy

yourselfyourself Very similar to the way Very similar to the way

you get car insuranceyou get car insurance About About 9% of the 9% of the

populationpopulation gets their gets their health insurance this health insurance this wayway

Health Insurance TermsHealth Insurance Terms Provider Provider – provides a – provides a health care servicehealth care service

NetworkNetwork – group of hospitals and/or – group of hospitals and/or doctors that doctors that jointlyjointly provide care to a given provide care to a given group of patients covered by health group of patients covered by health insurance insurance

Health Insurance TermsHealth Insurance Terms

Major MedicalMajor Medical - form of medical insurance - form of medical insurance designed to designed to supplementsupplement a basic medical a basic medical expense plan in the event of extraordinary expense plan in the event of extraordinary medical expenses medical expenses Example - extreme illness or disabilityExample - extreme illness or disability Read paragraph in notes in italic…Read paragraph in notes in italic…

Covered ExpenseCovered Expense – – something that the insurance something that the insurance plan will pay forplan will pay for

ExclusionsExclusions –Not all services –Not all services are covered. The policy-holder are covered. The policy-holder is generally expected to pay is generally expected to pay the the fullfull cost of non-covered cost of non-covered services out of their services out of their own own pocketpocket..

Read paragraph in notes in Read paragraph in notes in italic…italic…

Think John QThink John Q

Insurance Terms ContinuedInsurance Terms Continued Pre-existing ConditionPre-existing Condition – –

A health problem that a person has before they A health problem that a person has before they are covered by a certain policyare covered by a certain policy

The policy may or may not pay for expenses The policy may or may not pay for expenses associated with these conditionsassociated with these conditionsRead article in italic in notes…Read article in italic in notes…

Waiting PeriodWaiting Period – – Predetermined amount of Predetermined amount of timetime between when between when

your employment begins and when your your employment begins and when your insurance coverage actually beginsinsurance coverage actually begins

You are You are not coverednot covered during this time!!!during this time!!!

Your CostsYour Costs PremiumPremium – – The amount the policy-holder pays to the The amount the policy-holder pays to the

health plan each month to purchase health coverage health plan each month to purchase health coverage DeductibleDeductible – –

The amount that the policy-holder must pay The amount that the policy-holder must pay out-of-out-of-pocketpocket before the health plan pays its share before the health plan pays its share

Deductible could be Deductible could be yearlyyearly or could be per or could be per injury / injury / illnessillness

Read italic paragraph in notes…Read italic paragraph in notes… Example: Example:

• Your yearly deductible - $500.00Your yearly deductible - $500.00• Your medical Bill – $2,500.00Your medical Bill – $2,500.00

Insurance company pays $2,000.00Insurance company pays $2,000.00 You pay $500.00You pay $500.00

Costs!!Costs!!

CopaymentCopayment The amount that the policy-holder must pay The amount that the policy-holder must pay out out

of pocket of pocket before the health plan pays for a before the health plan pays for a particular visit or service. particular visit or service.

Example - Example - • a policy-holder might pay a $45 copayment for a a policy-holder might pay a $45 copayment for a

doctor's visit, or to obtain a prescription. doctor's visit, or to obtain a prescription. A copayment must be paid each time a A copayment must be paid each time a

particular service is obtainedparticular service is obtained Read italic paragraph in notes…Read italic paragraph in notes…

Managed CareManaged Care- Organized system of health care services designed to Organized system of health care services designed to

control health care costscontrol health care costs

- Use of a panel or network of health care providers to Use of a panel or network of health care providers to provide care to enrollees provide care to enrollees

- Managed Managed care usually involves:care usually involves:- Standards for selecting providersStandards for selecting providers- An emphasis on An emphasis on preventive carepreventive care - Financial incentives to encourage enrollees to use Financial incentives to encourage enrollees to use

care efficientlycare efficiently

Two main kinds of Managed Care Two main kinds of Managed Care InsuranceInsurance

HMO – HMO – Health Maintenance OrganizationHealth Maintenance Organization PPO – Preferred Provider OrganizationPPO – Preferred Provider Organization

HMOHMO

Manage patients' health care by Manage patients' health care by reducingreducing unnecessary servicesunnecessary services

Most HMOs require members to select a Most HMOs require members to select a primary care physicianprimary care physician (PCP)(PCP)

PCP = this physician acts a PCP = this physician acts a gatekeepergatekeeper to to medical servicesmedical services

PCP authorizes referrals to specialists or PCP authorizes referrals to specialists or other doctors if deemed necessary. This is other doctors if deemed necessary. This is called a “called a “referralreferral.”.”

Emergency medical care does not require Emergency medical care does not require prior authorization from a PCP prior authorization from a PCP

HMOs vs. non-networkHMOs vs. non-network Most HMOs Most HMOs will only pay will only pay for for

medical bills for you PCP of for medical bills for you PCP of for services your services your PCP approves PCP approves through referralthrough referral

HMOs typically provide HMOs typically provide no coverage no coverage for care received from non-network for care received from non-network physicians physicians exceptions for emergency care exceptions for emergency care

while traveling, etc. while traveling, etc.

HMO Public ImageHMO Public Image

HMOs often have a HMOs often have a negativenegative public image due to their public image due to their restrictiverestrictive appearance. appearance.

HMOs have been the target of HMOs have been the target of lawsuitslawsuits claiming that the claiming that the restrictions of the HMO prevented necessary carerestrictions of the HMO prevented necessary care

Usually a “Usually a “cheapercheaper” plan” plan

PPO – Preferred Provider PPO – Preferred Provider OrganizationOrganization

Organization of medical doctors, hospitals and other Organization of medical doctors, hospitals and other health care providershealth care providers ““network” or “preferred provider”network” or “preferred provider”

Network is contracted with an insurer to provide health Network is contracted with an insurer to provide health care coverage at a reduced rate (substantial discount)care coverage at a reduced rate (substantial discount)

Some surgeries or procedures may need to require pre-Some surgeries or procedures may need to require pre-approval by the insurance companyapproval by the insurance company

PPOs vs. non-networkPPOs vs. non-network

PPO may reimburse 90 percent of costs PPO may reimburse 90 percent of costs for care received within the network, but for care received within the network, but only 70 percent of costs for non-network only 70 percent of costs for non-network care care

PPO Public ImagePPO Public Image

Usually allow more freedom than HMOUsually allow more freedom than HMO

Usually a more expensive type of insurance planUsually a more expensive type of insurance plan

Networks can changeNetworks can change

If you choose to get medical care from a If you choose to get medical care from a provider who is out of network….It costs you provider who is out of network….It costs you more moneymore money

CAN YOU NAME THREE CAN YOU NAME THREE DIFFERENCES BETWEEN A DIFFERENCES BETWEEN A

PPO AND A HMO?PPO AND A HMO?

Fee For ServiceFee For Service

You purchase through an insurance agentYou purchase through an insurance agent You chose doctor – no need for a referralYou chose doctor – no need for a referral You pay monthly premium, deductibles, You pay monthly premium, deductibles,

and co-insurance.and co-insurance. Have a “lifetime maximum”Have a “lifetime maximum”

Different Types of Medical Different Types of Medical InsuranceInsurance

Hospitalization Insurance- Hospitalization Insurance- Specifically pays for hospitalization Specifically pays for hospitalization

Surgical Insurance – Surgical Insurance – Specifically pays for fees associated with Specifically pays for fees associated with

surgerysurgery Disability Insurance – Disability Insurance –

Pays for loss of income due to accident or Pays for loss of income due to accident or illnessillness

Usually only a percentage of your salaryUsually only a percentage of your salary

Co-InsuranceCo-Insurance

Instead of paying a fixed amount up front (a Instead of paying a fixed amount up front (a copayment), the policy-holder must pay a copayment), the policy-holder must pay a percentage of the total cost.percentage of the total cost.

Because there is no upper limit on coinsurance, Because there is no upper limit on coinsurance, the policy-holder can end up owing very little, or the policy-holder can end up owing very little, or a significant amount, depending on the actual a significant amount, depending on the actual costs of the services they obtain.costs of the services they obtain. Example-Example-

• member might have to pay 20% of the cost of a member might have to pay 20% of the cost of a surgery, while the health plan pays the other 80%.surgery, while the health plan pays the other 80%.

Federal Programs for Health Federal Programs for Health CoverageCoverage

MedicaidMedicaid – – health insurance for people with lower health insurance for people with lower

incomes incomes Funded by state and federal governmentFunded by state and federal government Eligibility rule vary state to stateEligibility rule vary state to state

• Example of Medicaid requirementsExample of Medicaid requirements You're a pregnant woman who meets income You're a pregnant woman who meets income

requirements. For example, a family of four making requirements. For example, a family of four making $23,225 a year or less qualifies.$23,225 a year or less qualifies.

Your family's assets are less than $2,000 Your family's assets are less than $2,000

Federal Programs for Health Federal Programs for Health CoverageCoverage

MedicareMedicare – – Government health coverage for people 65 Government health coverage for people 65

years or olderyears or older In many cases Medicare pays a portion of the In many cases Medicare pays a portion of the

person’s health care cost. person’s health care cost. The rest is paid by the person or The rest is paid by the person or

supplemental insurance plansupplemental insurance plan

WIC – Government ProgramWIC – Government Program

Women Infants and ChildrenWomen Infants and Children Program that helps mothers and children Program that helps mothers and children

with medical billswith medical bills Prenatal carePrenatal care Preventive screeningsPreventive screenings ImmunizationsImmunizations Pay for “proper” food and medicinesPay for “proper” food and medicines

Federal Programs for Health Federal Programs for Health CoverageCoverage

COBRA COBRA Consolidated Omnibus Budget Reconciliation Consolidated Omnibus Budget Reconciliation

Act (1985)Act (1985) Lose your job - may continue to pay your Lose your job - may continue to pay your

insurance premium & maintain coverageinsurance premium & maintain coverage This also applies to children on insured This also applies to children on insured

employeesemployees• If a child somehow loses full-time student status If a child somehow loses full-time student status

that child may make a COBRA payment to that child may make a COBRA payment to maintain coveragemaintain coverage

Rankings…Rankings…

U.S. ranks: U.S. ranks: 2222ndnd - infant mortality - infant mortality 4646thth - life expectancy - life expectancy 3737thth - health system - health system

performance, between performance, between Costa Rica and Costa Rica and SloveniaSlovenia

Bad system or Broken System?Bad system or Broken System?

In a 2007 comparison by the Commonwealth In a 2007 comparison by the Commonwealth Fund of health care: Fund of health care: USA, Germany, Britain, Australia, New Zealand, and USA, Germany, Britain, Australia, New Zealand, and

CanadaCanada USA ranked last on measures of quality, access, USA ranked last on measures of quality, access,

efficiency, equity, and outcomesefficiency, equity, and outcomes

30% of U.S. health care dollars, or more than 30% of U.S. health care dollars, or more than $1,000 per person per year, went to health care $1,000 per person per year, went to health care administrative costs administrative costs

Single Payer SystemSingle Payer System

National Health Care / Universal Health National Health Care / Universal Health CareCare

Centrally controlled heath care system Centrally controlled heath care system (government) – pay higher taxes(government) – pay higher taxes

Sometime requires supplemental health Sometime requires supplemental health insuranceinsurance

SickoSicko

http://www.youtube.com/watch?http://www.youtube.com/watch?v=xlDAUKSh9CQ v=xlDAUKSh9CQ