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Healthcare Delivery- JD > Lec 4: Traditional Insurance Concepts > Flashcards

Lec 4: Traditional Insurance Concepts Flashcards

1
Q

Most individuals over age 65 are covered by

A

Government (Medicare)

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2
Q

Of the remaining not covered by Medicare, people are covered by _____, _____, or ______.

A

Medicaid
Uninsured
Private insurance

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3
Q

Private insurance can be…

A

Group or individual

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4
Q

Who are the 4 key players in insurance?

A

Patients/consumers
Providers
Insurance companies
Employers

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5
Q

What is a premium?

A

Monthly payment

If not paid, insurance can get cancelled

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6
Q

Does Medicaid have a premium?

A

No, the taxpayers are paying for it

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7
Q

How do employer sponsored premiums work?

A

You pay part, employer pays other part

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8
Q

What is a copay?

A

Pay something at the time of visit

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9
Q

Are copay for PCP vs. specialist different?

A

Yes

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10
Q

What is a coinsurance?

A

It is a percentage of the bill

Example: 80/20 split in Medicare

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11
Q

What is a deductible?

A

How much comes out of your pocket before insurance starts paying

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12
Q

What is the out of pocket maximum?

A

Most you will ever have to pay in any year for the benefits that your plan covers; insurer will pay 100% of maximum for the rest of the year

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13
Q

What is a provider network?

A

List of doctors and hospitals that are connected to your plan
In network: discount
Out of network: full price

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14
Q

Difference between HMO/EMO and PPO?

A

HMO/EMO will pay nothing, but PPO: insurance will pay

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15
Q

The possibility of a substantial financial loss from an event of which the probability of occurrence is relatively small is what?

A

Risk

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16
Q

Who assumes risk?

A

Insurer

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17
Q

Risk spreading: in any given year: ___% of the population accounts for almost 1/4 of all health care spending in the US

A

1

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18
Q

Risk spreading: The sickest __% of people account for half of total spending

A

5

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19
Q

Risk spreading: The healthiest ___% of the population accounts for about 3% of total health care spending, in any given year

A

50%

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20
Q

What is the purpose of health insurance?

A

To pool many people together to spread (or share) the costs generated by a small number of people

21
Q

What are the 4 fundamental principles of insurance?

A
  1. Risk UNPREDICTABLE to individual insured
  2. Risk can be PREDICTED with REASONABLE ACCURACY within a group/population
  3. Risk transferred from INDIVIDUAL TO GROUP by pooling of resources
  4. ALL MEMBERS OF INSURED GROUP share actual losses on some equitable basis
22
Q

What are the 3 risk options for insurance?

A

Guaranteed issue
Experience rating
Community rating

23
Q

What is guaranteed issue?

A

Requirement that insurance be sold WITHOUT regard to health status

24
Q

What is experience rating?

A

Premiums determined by group’s own medical claims experience

25
Q

What is community rating?

A

Risk spread among members, premiums set without regard to health status, determined by utilization experience of larger community

26
Q

What is ADVERSE SELECTION?

A

People with a higher than average risk of needing health care are most likely than healthier people to seek health insurance.

27
Q

Adverse selection results when…

A

These less healthy people disproportionately enroll in a risk pool

28
Q

4 ways how insurers traditionally managed adverse selection?

A

Medical underwriting
Pre-existing condition exclusions
Risk-based rating
Benefit design

29
Q

What is medical underwriting?

A

Process insurers use to evaluate the risk of applicants

30
Q

What is risk-based rating?

A

Charging premiums based on an individual’s likely health care needs

31
Q

What is benefit design?

A

Coverage exclusions, high cost sharing

“Cherry picking”

32
Q

Health conditions that were traditionally ALWAYS DENIED?

A 
Cancer
HIV/AIDS
Diabetes
MS
Pregnancy
Stroke
33
Q

Health conditions that were traditionally OFTEN DENIED

A

Overweight
High BP
Cancer Hx
Asthma

34
Q

Health conditions that were traditionally SOMETIMES DENIED?

A

Acne

Hay Fever

35
Q

T/F: Health insurance is static?

A

FALSE! IT IS NOT STATIC

36
Q

Coverage options can change with these 5 things:

A 
Loss/change of job
Change in family status (divorce/death of spouse)
Bday
Move
Change in health status
37
Q

What does PRIVATE health insurance cover? (5 things)

A

Covered benefits

Cost sharing

Terms of coverage

Condition exclusions

ESI typically (not always) more comprehensive [individual insurance typically (not always) less so

38
Q

What does PRIVATE health insurance cover?: What are the covered benefits?

A

ACA: essential benefits required
Mandated benefits
Benefit limits (annual, lifetime, service and cost limits)

39
Q

What does PRIVATE health insurance cover? Cost sharing?

A

Deductibles, co-pays, co insurance

OOP cost sharing maximums, balance billing

40
Q

What does PRIVATE health insurance cover? Terms of coverage?

A

Provider networks

Care authorization/Utilization review

41
Q

What is the definition of balance billing?

A

Providers ability to bill the patient for the difference between what insurance covers and what their charges are

42
Q

In order to receive care authorization, PT needs to be…

A

Medically necessary

43
Q

What does health insurance cost depend on?

A 
WHO is covered
WHAT is covered
Insurer profits, administration
Subsidies
Underlying health care costs, inflation
44
Q

Before Obama Care, most expensive plans had the most benefits and least expensive plans had the least benefits, true or false?

A

True

45
Q

COBRA applies to job-based plans sponsored by employers with _____ employees

A

Greater than or equal to 20 employees

46
Q

Under COBRA, you will have temporary continuation of coverage after qualifying event such as?

A

Loss of employment: 18 months
Change in family/dependent status: 36 months
Disability: 29 months

47
Q

Under COBRA, employer premium contribution is….

A

NOT REQUIRED

48
Q

COBRA can be very ______ for individuals

A

Costly

Healthcare Delivery- JD (12 decks)

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