© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 1

2 11 C H A P T E R INSURANCE AND ITS EFFECTS ON U.S. HEALTH CARE

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3 The Issues  Employer-based insurance system  Insurers profits are increasing  Patients’ premiums are rising (Figure 11-1).  Significant gaps in coverage and quality

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 4 Since 2001, increases in health insurance premiums have outpaced wage increases. Source: Washington Post, Cost of Employer Provided Insurance, 9/12/2007 The Issues (cont.)

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 5 What is Insurance?  A protection from risk  Risk is shared by the (health plan) group (Figure 11-3).  Premiums are the cost to the insured.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 6 Types of Insurance  Indemnity plans  Service plans

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 7 Fee-for-Service  Insurance companies only paid the bills.  Physicians directed the care.  More services provided = more fees collected

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 8 Managed Care  Capitated system  Different HMO models (Table 11-1)  Incentives for providers to control costs  Shifts care to outpatient settings

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 9 Medicare  Universal coverage for elderly  Funded through wages  Four parts cover different services (Figure 11-4).  Facing significant issues (Figure 11-6)

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 10 There are four parts to the Medicare system. Medicare (cont.)

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 11 Medicaid  Coverage for persons living in poverty  Different structure from Medicare (Figure 11-7)

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 12 Medicaid’s structure differs from Medicare’s in several ways. Medicaid (cont.)

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 13 State Children’s Health Insurance  Coverage for uninsured children ineligible for Medicaid (Figure 11-9)  Not all eligible are enrolled  Continued funding has been an issue.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 14 Source: U.S. Department of Health and Human Services, Centers for Medicare and Medicaid Services, “The State Children’s Health Insurance Program”, PowerPoint presentation, March 5, 2007, pp State Children’s Health Insurance (cont.)

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 15 Other Public Funding Sources  SSI Benefits  Federal Employees Health Benefit Program  Military Health Services System  Veterans Health Care  Indian Health Service

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 16 Mental Health Services  Covered differently from medical services  Parity = equal insurance coverage  Legislation has addressed parity  Full parity is believed too costly