Health Insurance Flashcards
Comprehensive Major Medical Plans
Based on calendar year deductible, coinsurance percentage, and stop loss amount
Deductible
Amount that is paid before coinsurance begins
Most plans have separate limit for each person
Coninsurance
Percentage of covered expenses paid by the plan
Stop loss limit
Breakpoint
Once it’s reached the insurance company pays 100% of the expenses
Continuance and Portability
Affordable Care Act requires medical expense insurers to continue coverage regardless of claims as long as the premium is paid
Medicare Part A
- hospital insurance
Medicare Part A - Eligible Persons
- all persons age 65 and over who are entitled to SSA or railroad benefits
- disabled people receiving benefits for at least 2 years, regardless of age
- disabled get part A and B
Medicare Part A - Benefits
- hospital stays
- post hospital extended care in nursing home, up to 100 days
- unlimited post hospital health services
- hospice
- pay for first 3 pints of blood or donate it. Rest covered
Medicare Part A - Limitations
- services outside US
- if covered by employer group insurance, entitled to veterans benefits, covered by workers comp then Medicare is secondary
Medicare Part B
-Voluntary
- same eligibility as Part A
- premiums
- deductibles
- 80/20 coinsurance
- no stop loss
Medicare Part B - Benefits
- doctors services
- diagnostic tests
- outpatient services
- unlimited home health services
- free preventive care
- behavioral screening
Medicare Part B - Exclusions
- dental
- eyeglasses
- hearing aids
- immunizations
- prescription drugs
Medicare Part D
Plans run by an insurance company approved by Medicare
- drug manufacturers give 50% discount
- need part a and b
Medicare Supplemental (Medigap)
- plans A through J
- include benefits to pay deductibles and coinsurance plus more
- one medigap policy per person at a time
- can’t offer prescription drugs
Health Maintenance Organizations (HMOs)
provides services to a group of subscribers in return for a payments and delivery for fixed premium
Capitation (HMO)
A monthly fee is paid to the provider. In return the individual receives all the medical care required during the year
Gatekeeper (HMO)
care is managed by a primary physician who is responsible for determining what care is provided and when the individual should see a specialist
Disadvantage to HMO
- have to go through gatekeeper
- not covered when out of network, besides emergency
- have to get care from those affiliated with HMO
Preferred Provider Organizations (PPOs)
represent group of health care providers contracting to provide medical care at reduced fee
Income Tax Implications - Health Care
-premiums for employees and dependents are tax deductible by the employer
- employer premiums don’t create income tax liability for employee
- benefits are taxable if they exceed medical expenses
- self employed may deduct above the line
- some large corps report cost on W-2, its still not taxable
COBRA
- employers providing group or self funded coverage have to offer terminated employees right to buy continued health coverage (identical)
- companies under 20 employees (for half the year) are not required
COBRA and Disability
- if disabled, within 60 days of triggering event can extend COBRA continuation by 11 months (total 29 months)
Electing COBRA
- election period starts on date of qualifying event and up to 60 days after the actual notice of the event
- once elected, up to 45 days to pay premium
- cost cannot exceed 102% of cost of plan for similar employee
Medicare Part B - Election when covered by workplace plans
- if you or spouse is still working and has coverage through employer, my be wise to delay part B
- when employment ends 3 options
1. elect COBRA (higher cost)
2. sign up for part B within 8 months without penalty of increased premium
3. once you sign up for Part B, medigap enrollment period begins
Coverage for dependents under 19
no child under 19 can be denied coverage because of pre-existing medical conditions
Health Savings Account (HSA)
- individual or family
- deductible up to limits, 3,850 (s) and 7,750 (f)
- need HDHP, min ded. 1,500 (s) , 3,000 (f)
- HDHP out of pocket, 7,500 (s), $15,000 (f)
- no other plan and below medicare age
- over 55 get 1,000 catchup
- employer contribution not required
HSA Qualified Expenses
- doctors visits
- surgical procedures and hospitalization
- OTC prescription drugs
- acupuncture and chiropractic care
- eye exams, glasses, laser eye
- hearing test and aids
- dental exams and work/dentures
- alcohol drug treatment
- insulin and diabetic testing
- LTC expenses
- OTC drugs
- feminine hygiene
- insect repellant and itch cream
- sunscreen and aloe
- acne treatment
- eye drops
Archer Medical Savings Account (MSA)
No new MSA after 2005
Health reimbursement arrangements (HRAs)
- solely employer funded and reimburses employees for substantial medical expenses up to a maximum
- could reimburse out of pocket costs of HDHP
Characteristics of HRA
- cant be apart of cafeteria plan (solely employer funded)
- excluded from employee gross income
- cannot offer cash out option
- can reimburse after employment
- cant be used for same expense covered by FSA. HRA first
- employer retains excess unused money in HRA
Group Health Conversion Plan
terminating employee may exercise conversion privilege to purchase conversion plan for health insurance
- notification should be made immediately after termination or 180 days before end of COBRA
- application before temination ends and pay premium within 31 days
