fundamentals of insurance Flashcards
what is a beneficiary?
holder of insurance, covered by contract and eligible to receive benefits
what are the two insurance contracts?
- insurance company and contract holder (patients)
2. insurance company and providers (docs, therapists, etc)
t/f: insurance provides a stable source of income for health care providers
true
moral hazard
having opportunity to buy insurance and choosing not too
what are two services that insurance companies will not pay for?
elective cosmetic surgery, durable medical equipment
What is the criteria set by sponsor of insurance called?
eligibility requirements
t/f: insurers can refuse people who want to be insured
false, Obamacare requires anyone who wants health insurance access to it.
what is a covered event?
what events are typically excluded?
medical illness or injuries diagnosed by a credentialed doctor
civil disturbances, self inflicted injuries, war
how are work related injuries covered?
by worker’s comp
what are covered services?
must be reasonable, necessary, acceptable
what the insurance company decides they will cover
what are two types of cost limits?
Beneficiary cost limit- out of pocket max for pat
Provider cost limit- fee schedule, negotiated rates, limitations of visits
what type of insurance is most typically a benefit of employment?
private insurance aka commercial insurance
where is self insurance common?
in labor unions, have their own funds and are exempt from state regulations
what are the methods of cost sharing and how do they work?
Indemnity insurance- beneficiary pays in full and gets reimbursed by insurance company
Service Benefit Plans- plans list eligible providers who are paid directly from insurance. there is a fee schedule for rates of services
T/F: you can have long term care coverage as part of your health insurance.
false. long term care needs its own policy. LTC is getting more popular as the population ages
What are the three parts of workers comp?
health care insurance disability benefits (paid 2/3 of income while unable to work) vocational rehab- trains for a job you can do, if no longer able to perform current job
t/f: workers comp is state specific
true
what right do workers give up in exchange for workers comp?
the right to sue employer for negligence.
what body is responsible for regulation of insurance?
the state, but subject to federal regulation
t/f: insurance companies need to be licensed where they sell insurance products
true
What does ERISA stand for?
Why was it established?
Employee Retirement Income Security Act of 1974
To prevent embezzlement of people’s retirement funds
What act amended ERISA, and what did it add?
HIPAA, stops employers from discriminating against employees on the basis of health or pre-existing conditions.
What does COBRA stand for and what does it do?
Consolidated Budget Reconciliation Act
allows a person to continue purchasing insurance they had with an employer at full cost, even if no longer working at that employer
What is insurance?
financial mechanism that shares and disperses risk of financial loss due to occurrence of an adverse event
improves financial stability of individuals and organizations
