1. Health Insurance 101

2. Cycle without Health Insurance
Uninsured consumer can't afford doctor
Consumer delays care, goes to ER
Consumer can't pay
Providers shift cost to Insurers
Insurers shift cost to consumer
Consumer drops policy due to high price and is now uninsured
Let's begin looking at health insurance basics.
By 2010, the number of uninsured Americans had reached 32 million
The economic downturn caused more people to lose their jobs and their health care coverage at the same time, pushing the number of uninsured up to nearly 50 million people by 2011.
Consumers could not afford to get medical attention. When a medical situation did occur, people began using the emergency room for their primary care. The financial impact to many Americans was devastating. The American Journal of Medicine reported in 2009 that illness and medical bills contributed to a large and increasing share of US Bankruptcies.
62% of all bankruptcies nationwide were related to medical debt. Most were well educated, owned homes and had middle-class occupations.
75% of these bankruptcies involved people who had health insurance but the limitations of their coverage such as high deductibles, high out of pocket maximums, lifetime limits and benefit exclusions were inadequate to cover the medical expenses incurred.
In response to the high number of people who could not pay their medical bills, providers had to shift the costs of these uncompensated services to insurance companies and to consumers. As a result, the costs of medical care have increased dramatically, including the premiums people must pay for a health insurance policy and the out of pocket expenses they pay to receive care.
In 1960, the annual individual health care cost was $148. By 2011, this cost had skyrocketed to $8,311. If other prices rose like this a tube of toothpaste might cost $13.50 today and an electric can opener might cost nearly five hundred dollars.

3. Key Point
Estimated Premium
This is the amount of money that you will pay monthly for your health insurance coverage. This does not include any out-of-pocket health care expenses.
Notes:
…and the healthplanfinder will provide an explanation.

4. Ten Essential Health Benefit Categories: must be included in each health care plan after 1/1/14
1. Ambulatory services
6. Prescription drugs
2. Emergency services
7. Rehabilitative and habilitative services and devices
3. Hospitalization
8. Laboratory services
4. Maternity and newborn care
9. Preventive and wellness services and chronic disease management
5. Mental health and substance use disorder services, including behavioral health treatment
10. Pediatric services, including oral and vision care
The essential health benefit categories that all plans must include are intended to mirror those provided under a typical employer-sponsored health plan. The United States Secretary of Health and Human Services (HHS) has defined a package that includes, at a minimum the 10 categories you see listed on the screen.
While the Affordable Care Act requires coverage for each of these categories, the law does not define the specific services that must be covered or the amount, duration, or scope of services.
Using the Washington Healthplanfinder, individuals will be able to do an apples to apples comparison of qualified health plans to see how the plans offer benefits in these 10 categories. That way, individuals can select the plan that best meets their unique health care needs.

5. What is the penalty for the individual mandate?
Key Point
2014: $95 per adult and $47.50 per child (up to $285 for a family) or 1% of income, whichever is greater
2015: $325 per adult and $ per child (up to $975 for a family) or 2%, whichever is greater
2016: $695 per adult and $ per child (up to $2,085 for a family) or 2.5% of family income, whichever is greater
Notes:
Beginning in 2014, any person without qualifying health care coverage must pay a tax penalty, either a flat rate or a share of household income, whichever amount is greater.
The penalties will be phased-in over a three-year period. The individual or family will pay either a flat rate penalty depending on the size of the family, or a percentage of their income, whichever is greater.
In 2014 the flat rate penalty will not exceed $285 per family per year, or 1 percent of the family's income, whichever is greater.
In 2015, the flat rate penalty increases to a maximum of $975 for a family or 2% of their income.
In 2016, the maximum flat rate for a family is $2,085 or 2.5% of their income.
After 2016, penalties will increase or decrease based on a cost of living adjustment.

6. Types of Commercial Health Insurance
Health Maintenance – HMO’s
Preferred Provider Organizations – PPO’s
Notes:
The most common types of commercial health insurance programs today include:
- Health Maintenance Organizations (HMO’s) and
- Preferred Provider Organizations (PPO’s)

7. Health Maintenance Organizations (HMO’s)
Network providers and primary care physician
Co-payment
Lower out of pocket expenses
Key Point
“In-Network”
Individual must seek care from
Health Care Professionals
Laboratory
Medical Facilities
Pharmacy
Notes:
Health Maintenance Organization - Typically individuals are required to obtain care from doctors and hospitals affiliated with the health maintenance organization (HMO). It is also required to pick a primary care doctor who treats and directs health care decisions and makes referrals to specialists. Generally the coverage is provided within the network only. The health maintenance organization will require that care from health care professionals, laboratories, and medical facilities come from within its network. This type of coverage limits where medical care is obtained.
People insured by an HMO, aside from co-payments, generally have little or no other out of pocket expenses and are not required to pay deductibles. By using network doctors and services, HMO's are able to keep costs lower.
For example, instead of paying $150 for a doctor's office visit, a patient will pay a $20 or $30 co-payment to the physician, and the HMO will pay the physician a contracted rate for the office visit. This greatly reduced cost to visit a doctor is intended to encourage insured persons to see their doctor for regular exams and at the first sign of a medical issue rather than postponing care until a medical condition has become severe and treatment is costly.
In-Network
Providers Only

8. Preferred Provider Organization (PPO)
Contracted Preferred Provider List
More choice of providers
Higher costs for using non-Preferred Providers
Key Point
“Yes! My provider’s on this list!”
Provider List
Notes:
Preferred Provider Organization -
A preferred provider organization (PPO) publishes a list of contracted/preferred providers to choose from to seek medical care and costs are lower when a provider on the list is used.
PPOs are popular for people who want more freedom of choice about the licensed health care professionals they see.
When a provider that is not on the list is seen, higher costs may be experienced. You may consider assisting your customer to check whether a doctor or hospital or any provider they know they want to use is contracted as a preferred provider before seeking services. You may go to the insurance company website or call their customer service department. However, when making a doctor's appointment or when a provider offers your customer a referral, they should always verify that the doctor is on the preferred provider list.
Scenario: Your customer is playing softball in a spring league. They round first, but their foot slips off the base. They feel a pull, hear pop in their knee and know there has been some damage. They decide to go to their insurance company’s website and look up an orthopedic doctor and call to set up appointment. At the same time they make the call to make an appointment they also verify that they are contracted as a preferred provider with the insurance company they pay premiums to. Two steps have been taken to make sure that the doctor is contracted with the health insurance company. If the provider happens to order an x-ray, it is also important to verify that wherever they are sent for this x-ray is also a contracted provider. If your customer does not verify that a provider is contracted with the insurance company before they are seen, they could face higher out-of-pocket costs and in some cases end up being responsible for the bill for uncovered benefits.
Individuals who choose a PPO have more options and more responsibility for their choices.
Choosing a provider from the list = lower costs $$
Choosing a provider that is not on the list = higher costs $$$$$

9. Understanding Health Insurance Cost Sharing
Notes:
Here we have a scenario where an individual (Jane) has health insurance and is using her benefits. It is important to note that different health plans will carry different premiums, deductibles and maximum out-of-pocket limits. This example is for the purpose of demonstration.
In this case Jane's health insurance plan deductible is $ This is the out of pocket portion Jane must pay before the health insurance plan begins picking up the charges of approved medical care services rendered to her for her health care.
in January Jane seeks medical care as an outpatient. The visit has a cost of $ Since Jane hasn't met her health plan deductible yet she is responsible for the entirety of the $ dollar medical expense and her plan pays nothing at this time. The $ dollar medical expense Jane pays does count toward her $1500 dollar deductible.
by April Jane has received enough medical care services to have met her annual deductible of $ dollars. This is where her health plan's coinsurance begins. Her health plan will pay some of the medical care cost for her next visit. Jane seeks care and the out patient visit this time costs $75.00 dollars. Jane's coinsurance is 20 percent so she pays 20 percent of the $75.00 dollar expense (or $15.00 dollars) and her health insurance plan pays the remaining 80 percent (or $60.00 dollars).
It's now may, and Jane has seen the doctor often and has paid her entire maximum out-of-pocket expense of $ dollars. For the rest of this year, Jane's health insurance plan pays the full cost of her covered health care services. It's November and Jane has another need to visit the doctor. This visit costs $ dollars. Jane pays nothing and her health insurance plan pays the entire sum of $ dollars.
Please keep in mind that this example did not take into consideration Jane's annual income and whether or not she is eligible for health insurance premium tax credits and cost sharing reductions that go in to effect on January 1, 2014.

10. Questions to ask Yourself
What is the premium? Monthly? Annually?
What is the deductible?
What is the maximum amount of money my customer might have to pay out of pocket during a policy year?
My customer has specific health care needs. Are these needs covered by the Qualified Health Plans we’re looking at?
Are there any services that are limited in this policy?
What services are excluded in this policy?
Here are some questions you may want to ask yourself while you facilitate the shopping experience for your customer’s health care coverage.

11. What are the Benefits of Health Insurance?
Better Health
Peace of mind
Financial protection
Control in health care options
Ability to shop, compare and enroll online
The benefits of having insurance will certainly vary from person to person, but health insurance can offer peace of mind, financial protection, and better health.
The Exchange will provide a one-stop shop where consumers can make apples to apples comparisons and enroll in qualified health plans available in their area. Eligibility determination through Washington Healthplanfinder will provide real-time results for Medicaid, qualified health plans, health insurance premium tax credits and other cost reductions.
All health plans offered through Washington Healthplanfinder will be qualified health plans. This means that each plan was reviewed and approved by the Office of the Insurance Commissioner and then approved by the Washington Health Benefit Exchange. All of these plans will include the requirements of the 10 essential health benefit categories such as preventive care, maternity services, pediatric dental/vision, and more.

12. Knowledge Check What is the definition of Estimated Premium?
The percentage owed for each visit to a provider until the deductible is met.
The co-payment required until the maximum out of pocket expenses are met.
A deductible.
The amount of money paid monthly for health insurance coverage. This does not include any out-of-pocket health care expenses.
All of the above.

13. Knowledge Check
Starting ____________, all individual and small employer health plans must include 10 essential health benefit categories. January 1, 2014 October 1, 2013 March 31, 2013 December 15, 2014
Starting January 1, 2014, all individual and small employer health plans must include 10 essential health benefit categories.

14. Knowledge Check What is the Individual Mandate?
Every United State’s citizen and legal resident (with no exceptions) must have qualifying health care coverage or pay a penalty.
Every United State’s citizen and legal resident (with some exceptions) must have qualifying health care coverage or pay a penalty.
Individuals are mandated to have fire insurance.
The Affordable Care Act requires all United State citizens and legal residents to have qualifying health care coverage or pay a tax penalty.

15. Knowledge Check
This is the amount you and/or your family pay each policy period before your health plan starts to pay for covered services.
Co-Insurance
Co-Payment
Premium
Deductible
A deductible is the amount that must be paid before a health plan starts to pay for covered services.

16. Knowledge Check
It’s the end of the year, I am an individual adult that decided not to get qualifying health care coverage. What is the minimum penalty I will be assessed.
The cost of one year’s worth of premiums based on a bronze level plan.
The cost of one year’s worth of premiums based on a silver level plan.
$95
The cost of one year’s worth of premiums based on a gold level plan.
2014: $95 per adult and $47.50 per child (up to $285 for a family) or 1% of income, whichever is greater

17. Knowledge Check In a HMO an individual must seek care from…
Any provider they wish.
An In-Network provider.
A provider they’ve seen in the past.
The provider that is closest to the individual’s home.
The health maintenance organization will require that an individual seek care from health care professionals, laboratories, and medical facilities with in its network. This type of coverage limits where medical care can be obtained.

18. Knowledge Check
Which of the following is not a characteristic of a PPO?
They provide a Contracted Preferred Provider List
Out of pocket costs are lower when an insured individual uses providers from the Contracted Preferred Provider list.
Insured must use In-Network providers.
This may be a good place to have a discussion around educating a customer about how to use their insurance.
Make sure the provider they want to see is contracted with the insurance company as a preferred provider
This includes any referral they are given from one provider to see another provider (tests, labs, specialists)

19. Knowledge Check
An individual policy has a $200 yearly deductible and a 30% coinsurance. This individual is not eligible for any cost sharing reductions. The individual has not been feeling well and decides to go to the Dr. for the first time. Will the individual have any out of pocket costs and if so, what will they be?
This individual is responsible for the first $200 of the bill.
This individual is responsible for the first $200 of the bill plus 30% of anything over $200.
Nothing. This is what they bought health care coverage for.
If the bill is $230 the individual must first pay the deductible which is $200
The individual is responsible for 30% of the $30 balance which is $ 9
The total amount the individual is responsible for is $209
The entire $209 is applied toward the Maximum Out of Pocket cost sharing the individual is responsible for.

20. Knowledge Check
In the previous scenario the maximum out of pocket expense the insured is responsible for is $ The insured has been very ill and needs to go back to the Dr. for further treatment. The insured has paid $1900 out of pocket to date. They have already met their $200 deductible. This Dr. visit is $200. How much will this visit cost the insured?
$100
$60
$40
$200
$2000 Maximum Out of Pocket – deductible has been met
-1900 Already paid
100 left to apply to Maximum Out of Pocket.
30% of 200 is $60. This leaves $40 the insured has left to apply to their Maximum Out of Pocket responsibility.
$100
-60 40

21. Knowledge Check
The insured has met their Maximum Out of Pocket expense. They go to the Dr. and receive treatment that is not a covered service. What amount of the bill will they be responsible for?
$200
30%
All of it. The service was not covered
None of it. This is why they purchased health care coverage
If a service is not a covered service the insured is responsible for the entire bill. This amount will not count towards their Maximum Out of Pocket expense – it is not considered cost sharing.

22. Knowledge Check
The insured has met their Maximum Out of Pocket expense. They go to a Dr. and receive treatment for a covered service. The bill is $ How much of this bill is the insured responsible for?
$17.35
$52.05
$173.50
Nothing