Types Of Health Policies Flashcards
Medical Expense Insurance is made up of
Basic hospital, surgical, and medical policies and the Major Medical Policies
Basic coverages (hospital, surgical, medical) can be purchased how
Separately or together In a package
First dollar means the same as
No deductible
What does Basic Hospital Expense Coverage cover
Hospital room and board, lab and x-day expenses, medicines, use of operating room and supplies, while the insured is confined in a hospital
Basic Medical Expense Coverage covers what (also refers to as Basic physicians nonsurgical expense coverage)
Provides coverage of nonsurgical services a physician provides. Benefits are limited to visits to patients confined in the hospital.
How is basic medical coverage limited
Usually by number of visits per day, limit per visit, or limit per hospital stay.
Basic medical and also be purchased to cover
Emergency accident benefits, maternity benefits, mental and nervous disorders, hospice care, home health care, outpatient care, and nurses expense.
Basic surgical expense coverage is often written in conjunction with hospital expense policies. This covers
Cost of surgeon services, performed in or out of the hospital. No deductible but coverage is limited
Major medical policies usually provide for
- Comprehensive coverage for hospital expenses ( room and board, and miscellaneous expenses, nursing expenses, physicians services )
- Catastrophic medical expense protection
- Benefits for prolonged injury or illness.
Supplemental major medical policies are used to supplement the coverage payable under a basic medical expense policy. Before the supplemental coverage takes place after basic medical has pays, the supplemental takes effect:
On a first dollar basis( no-deductible) but a corridor deductible must be paid after basic expenses are exhausted and before supplemental picks the the remaining cost.
The Health Maintenance Act of 1973 helped develop Health Maintenance organizations (HMOs). The act forced
Employers with more than 25 employees to offer the HMO as an alternative to their regular health plans.
The main goal of the HMO act was
Reduce the cost of health by utilizing preventative care
HMO’s offer free
Annual check ups and free or low cost immunizations
HMO provide benefits in the form of
Services, rather than reimbursement for services. It provides both financing and patient care
HMOs are organized geographically. That means
If you live within the geographic limitations for an HMO, you are eligible, if not, you are ineligible
HMOs have a limited choice of providers. The purpose of this is
To limit costs by only providing care from physicians that meet their standards, and provide care at a pre negotiated price
HMOs also require copayments. This payment is required to paid for
Each visit
HMOs operate on a capitated basis. This means
The HMO receives a flat amount each month attributed to each member WHETHER YOU SEE A PHYSICIAN OR NOT
HMOs have 4 general characteristics
- Limited Service Area
- Limited Choice of Providers
- Copayments
- Prepaid Basis
Primary Care Physician or gatekeeper is chosen
When a person becomes a member of an HMO.
What kind of care does an HMO provide other than preventative
Inpatient hospital care in or out of the HMOs service area.
Inpatient hospital care of an HMO my be limited for what conditions
- Treatment of mental disorders
- Emotional disorders
- Nervous disorders
Including alcohol or drug rehabilitation of treatment
Can emergency care by an HMO be given to someone outside for the service area?
Yes. Emergency care must be given to a member both in and out of the service care area.
Preferred Provider Organizations (PPOs), rather pay physicians on a salary basis like HMOs
Pay physicians on paid fees for services.
PPO encourage members to visit approved member physicians in the form of
Benefits. The PPO may provide 90% of the cost to members who see an approved physician, as compared to 70% for a physician not on the list.
A group of physicians and hospitals that contract with employers, insurers, or third party organizations to provide medical care for services at a reduced fee is
A PPO
What are two ways PPOs differ from HMOs
- PPOs do not provide service on a prepaid basis, but paid a fee for service
- Subscribers are not required to use physicians or facilities have have contracts with PPO
Open panel means
When a medical caregiver contracts with a health organization to provide services to its member or subscribers, but retains their right to treat patients who are not members or subscribers
When the medical caregiver provides services to only members or subscribers of a health organization and contractually is not allowed to treat other patients is referred to as
A closed panel
Point of Service plans (POS) plans
Are combination of HMOs and PPO plans
In a PPO all network providers are considered
“Preferred” and you can visit them, even specialists, without first seeing a primary care physician. (called PCP referrals)
A form of cafeteria benefit plan funded by salary reduction and employer contributions. Employees are also allowed to deposit a certain amount of their paycheck into an account before paying income tax. Benefits are on a use it or lose it basis
Flexible Spending Account (FSA)
2 types of Flexible Spending Accounts
- Health Care account for out-of-pocket health care expenses
- Dependent Care Account
FSA ARE exempt for what kind of taxes
- Federal Income Taxes
- Social Security (FICA) taxes
- In most cases, state income taxes
If an FSA plan favors highly compensated employees, the benefits for those employees are or are not exempt from taxes?
Are NOT exempt from federal income taxes.
These things qualify a child or dependent care for be covered by an FSA
- A dependent who under the age of 13 AND can be claimed as an exemption on the employee’s Federal Income Tax return
- A spouse who is physically or mentally not able to care for him or her self
- A dependent who was physically or mentally not able to care for him or her self and can be claimed as an exemption
One can change benefits during the open enrollment period in an FSA if one of these 6 events happen (qualified life event)
- Marital status
- Number of dependents
- One of dependents satisfies or ceases to satisfy requirements for coverage
- Change of employment
- Change in dependent care provider
- Family medical leave
Contribution to Dependent Care Accounts are limited by
The IRS. ($5000 for family limit, $2500 for married employee filing separately)
Funds set aside by employers to reimburse employees for qualified medical expenses are
Health Reimbursement Accounts (HRAs)
A key characteristic or an HRA is
They are contribution healthcare plans, not defined benefit plans
Not a taxable employee benefit
Employees can rollover unused balances at the end of the year
Eligibility and contribution limits for HRAs are determined by
The employer, not matter the size
High Deductible Health Plans have
Higher annual deductibles and out of pocket expenses which has a lower premium
In order to be eligible for Health Savings account (HSA)
And individual must be covered by a HDHP, and must not be covered by other insurance
