Health Insurance

Supplementary and Transitional Insurance Health Insurance Supplementary and Transitional Insurance The federal Government has established two programs for people who are between jobs, lose a job, lose insurance due to death, or lose insurance because of a divorce Consolidated Omnibus Budget Reduction Act (COBRA) Health Insurance Portability and Accountability Act (HIPAA)

COBRA Gives employees the right to continue their group coverage at their own expense for 18-26 months You can quality if… If you leave your job or are terminated If you are divorced from the covered employee If your work hours are reduced below minimum requirements If you are eligible for Medicare If you become disabled If the covered employee dies

COBRA You must pay your share and the employer’s share of the premiums plus an administrative fee If your former employee goes out of business your plan can be terminated COBRA can be very complicated so you have to keep up to date with the rules and regulations

HIPAA The “portability” law Protects health insurance coverage for workers and their families when they change or lose their jobs Unlike COBRA, you do not take your previous health insurance policy with you Your eligibility of insurability transfers

Government-Provided Health Insurance A healthy population is a benefit to society The government provides health insurance for citizens it deems most in need “Entitlement Programs” Medicaid Medicare

Medicaid Became law in 1963 under the Social Security Act Provides medical assistance for eligible individuals and families with low incomes and resources Varies widely from state to state because each state establishes their own guidelines

Medicare The nation’s largest health insurance program Covers 39 million Americans The largest group covered by Medicare is people over the age 65 Also provides care for people with disabilities

Medicare Two types of Plans Type A: Covers a percentage of hospital bills Free to anyone who has worked 10 years in Medicare-covered employment Type B: Covers non-hospital expenses Charges a small monthly premium You must pay a deductible and a co-payment for each

Healthcare Problems in the United States The United States provides the highest quality health care in the world Despite breakthroughs in medicine, the healthcare system continues to be a source of great frustration Rising healthcare costs Large number of uninsured people Uneven quality of medical care Considerable waste and inefficiency

Rising Healthcare Costs Healthcare Problems in the United States Rising Healthcare Costs Factors accounting for the increase Rising hospital costs Due to expensive technology, high labor costs due to shortage of nurses and consolidation of hospitals Rising prescription drug costs New technology Physician cost trends Due to increased use of specialists

Rising Healthcare Costs Healthcare Problems in the United States Rising Healthcare Costs Factors accounting for the increase (continued) Cost shifting by Medicare and Medicaid Private patients have to pay more to cover costs of other patients that these programs do not cover State mandated benefits States mandate that insurers must provide certain benefits Higher administrative costs Includes customer service, information technology, and medical management costs Uninsured patients, healthcare fraud and abuse of the system

Large Number of Uninsured Persons Uneven Quality of Medical Care Healthcare Problems in the United States Large Number of Uninsured Persons An estimated 15 percent of the population does not have health insurance Uneven Quality of Medical Care Medical care varies widely depending on the physician, geographic location, and the type of disease being treated

Waste and Inefficiency Healthcare Problems in the United States Waste and Inefficiency The administrative costs of delivering health insurance benefits are excessively high Large amounts of paperwork Claims forms are not uniform Defensive medicine by physicians results in unnecessary tests and procedures