Who pays for today’s healthcare? Health Insurance Fall 2014 Who pays for today’s healthcare?

What Is Insurance? OH NO!! Then you remember: You have insurance! PHEW! Insurance is a way to ensure you are protected from financial loss. Many people in the US are uninsured. Insurance decreases out of pocket expenses for health care services. When something bad happens, such as a hurricane or a car accident, your insurance will cover some or all of the costs to fix the damage, depending on your policy. There are many types of insurance – they are called lines of insurance. Clipart of a worried face saying "Oh No11" about not having insurance, but then a relieved face saying "phew" when remembering it has insurance coverage.

What’s a Policy? An policy is a contract between you and your insurance company. A contract is an enforceable promise for something of value. Can be renewed annually or monthly. You promise to pay the insurance company a premium and the insurance company promises to pay your claims as they arise. Clipart of a shaking hands over a policy contract

What’s a Premium? A premium is the amount of money you pay every month (or other set time period) for your insurance coverage. Your premium might be different from the person sitting next to you. The insurance company takes many factors into account before it offers you coverage. The insurance company determines your premium by deciding what type of risk you (or the thing you are insuring) are.

What is the cost of healthcare? U.S. health care spending reached $2.7 trillion in 2011, or $8,680 per person. What would the cost be for our classroom?

How are we spending our money? Hospital Care 850 billion Physicians & Clinical Services 541 billion Other Professional Services 73 billion Dental Services 108 billion Health, Residential & Other Personal Care Services 133 billion Home Health Care 74 billion Nursing Care Facilities 149 billion TOTAL: $2.7 trillion Prescription Drugs 263 billion Durable Medical Equipment 38 billion Other Non Durable Medical Products 47 billion

Healthcare Spending by TYPE of Service Description Hospital Care Hospital services Physicians & Clinical Services Physician & Clinician Services Other Professional Services Physical Therapy, optometry, chiropractic care Dental Services Health, Residential & Other Personal Care Services Ambulance providers, substance abuse treatment centers, community centers Home Health Care Freestanding home health agencies Nursing Care Facilities Skilled nursing facilities Prescription Drugs Brand name, generic and specialty drugs Durable Medical Equipment Contact lenses, glasses, & hearing aids Other Non Durable Medical Products OTC meds, surgical dressing & medical instruments

What does this mean for you? Consumer Healthcare costs are rising. More people, more costs Question: Are we going to cut back or going to continued to let cost spiral up? Potential career option More people, more demand for services More demand for services creates more jobs!

How does a person pay for these costs? Medicare Medicaid Private health insurance Out of pocket

How does insurance work? Insurance is more affordable when purchased in large groups – only a few of the insured will require constant medical care and use the insurance in large amounts. Co-insurance (i.e. 80%-20%). A percentage the patient is responsible for on a given insurance claim Companies purchase health insurance for employees

Obtaining Health Insurance Coverage Through Your Employer Eligibility depends upon continuous employment Employees must work 20 or more hours per week at most companies. Most companies have a waiting period before insurance benefits are available (i.e. 30 days, 60 days, etc…). Pre-existing conditions may be ineligible for insurance coverage.

Types of Health Insurance HMO - Health Maintenance Organization A type of managed care medical insurance Specialist treatment is available with a referral Insured are limited to contracted physicians for care. Out of pocket expenses are set. Specialty care must be submitted to HMO for approval – it may be denied.

Types of Health Insurance PPO - Preferred Provider Organization Physicians contract services for a set fee and are listed as a preferred provider. The insured person chooses from a list of preferred providers. The insurance company pays a set amount and the insured pays a set amount called the co-payment. Referrals are made to specialists on the list.

Types of Health Insurance Agency Plan Example: Aetna, Humana, Blue Cross/ Blue Shield, etc… Fees for insurance may be less up front Pay for larger portion of care when received May have large deductibles Usually more freedom in choice of doctors. Agency may offer several types of plans (HMO, PPO, etc…)

Types of Health Insurance Medicare Government program providing health care to people over age of 65 and those who are disabled and have received Social Security benefits for at least 2 years. Medicaid Medical assistance program Operated by the STATE, not the federal government Pays for health care of people with low incomes, children who qualify for assistance, and people who are physically disabled or blind

How does insurance work? Insurance is more affordable when purchased in large groups – only a few of the insured will require constant medical care and use the insurance in large amounts. Co-insurance (i.e. 80%-20%). A percentage the patient is responsible for on a given insurance claim Companies purchase health insurance for employees