Chapter 3: Basic of Health Insurance Lesson 2_Topic 2 Categories of Health Insurance

Three Classes of Health Insurance Group Contract any insurance plan by which a homogeneous groups is insurer under a singled policy issued to their employer/leader, with individual certificates for each member For example: An employer offering group medical insurance to their employees. What is a blanket contract? (Comprehensive group insurance coverage through plans sponsored by professional associations for their members) COBRA is the law requiring companies of 20 or more employees to extend insurance coverage to laid off workers for up to 18 months. Three Classes of Health Insurance Copyright © 2008, 2006, 2004 by Saunders an imprint of Elsevier Inc. All rights reserved.

Group Contract Continued… Blanket Contract Comprehensive group insurance coverage through pans sponsored by professional associations for their members (For example: AMA) If a member leaves the associations, they can enroll in an individual contract (conversion privilege) Less benefits Higher premiums Group Contract Continued…

Group Contract Continued… COBRA For companies with 20 or more workers If an employee is laid off from work, they may purchase group health insurance benefits from their employers Includes reduction in work hours Covered at group rates for 18 months Income continuation benefits Group Contract Continued…

Group Contract Continued… Medical Savings Accounts (MSA) Tax-free saving account that allows individuals and their employers to set aside money to pay for health care expenses. Health Savings Accounts (HSA) Tool to control medical expenses for individuals with high-deductible health plans Tax-free when used for qualifying medical expenses Rolled over year to year Group Contract Continued…

Three Classes of Health Insurance Individual Contract Also called personal insurance an individual contract is specific to an individual and/or dependents Benefits can be specific for patients needs Typically has higher premiums and deductibles Three Classes of Health Insurance

Three Classes of Health Insurance Prepaid Health Plan a prepaid health plan is a program in which a specific set of health benefits is provided for a subscriber(s) pays a yearly fee or fixed periodic payments Capitation: System of payment used by MCO Physicians are paid a fixed amount per patient over a period of time Three Classes of Health Insurance

Dr. Martin is paid capitation for 50 patients in her practice Dr. Martin is paid capitation for 50 patients in her practice. The per capita amount is $20.00 per patient. She receives capitation every 3 months. With capitation, no matter how many times Dr. Martin sees/exams these patients, she will still only receive $20.00 per patient, per quarter. Patient A is seen 5 times in 3 months: $20.00 Patient B is NOT seen at all in 3 months: $20.00 Capitation Example