Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Chapter 14 Health Insurance
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Evolution of Health Insurance Historically, health insurance provided coverage for catastrophic illness and injury It has evolved into coverage for preventative care and services The traditional type of insurance is fee-for- service care
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Managed Care Delivery Systems This system integrates the delivery and payment of health care by contracting with select providers for a reduced cost The goal is to provide health care with an emphasis on prevention
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Types of Insurance Plans Commercial health insurance plans Indemnity-type insurance Health maintenance organizations (HMOs) Consumer-driven health plans (CDHPs) Government health plans
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. HMOs Provide comprehensive health care with a focus on preventative care – Annual physicals and PAP tests, well-child care Members choose a Primary Care Provider (PCP) to oversee medical care – PCP refers to a specialist, if needed
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. HMOs Types of HMOs – Staff-model HMO Providers are employed by the HMO; all services (except emergencies) are provided by the practice Preauthorization is required when traveling – Group-model HMO Multispeciality practices contracted with HMO May be reimbursed on a capitated basis
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. HMOs Types of HMOs – Preferred provider organization (PPO) Members must select a PCP Network of providers that provide services to members at a discounted rate (in-network) Members pay more out of pocket for out-of-network providers – Point-of-service (POS) plans – Independent practice associations (IPAs)
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. HMOs Types of HMOs – Point-of-service (POS) plans Members do not select a PCP and can self-refer to specialist – Independent practice associations (IPAs) Providers who practice in their own offices with their own staff
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. CDHPs Health savings account (HSA) – Must be paired with a qualified health plan Health reimbursement account (HRA) – Employers contribute to HRA (not employees) Flexible spending account (FSA) – Employees contribute to FSA – Can pay for health insurance premiums, qualified medical expenses, dependent expenses
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. CDHPs Flexible spending account (FSA) – Components Health insurance premiums Qualified medical expenses Dependent care expenses – Funded by the employee’s pretax dollars – “Use it or lose it” plan
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Government Health Plans Medicare Medicaid Workers’ Compensation TRICARE CHAMPVA
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Medicare Created by the Social Security Act in 1965 – Administered by the Centers for Medicare and Medicaid Services (CMS) Who is covered? – People over age 65 meeting eligibility requirements and have filed for Medicare – People who are disabled, receive Social Security benefits, or are in end-stage renal disease
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Medicare Part A – Hospital coverage
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Medicare Part B – Other medical expenses, including office visits X-ray and laboratory services Initial Preventive Physical Exam Part C – Enables beneficiaries to select a managed care plan as their primary coverage Part D – Coverage for generic and brand-name drugs
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Medicare and Claims Processing Always keep up-to-date with Medicare requirements – Must use CMS-1500 form – Must submit Medicare claims electronically
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Medicare and Claims Processing Reimbursement to providers – Medicare pays 80% of allowed amount after the deductible is satisfied – 20% is paid by patient, or supplemental insurance
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Medical Necessity Medicare only reimburses services or supplies deemed reasonable and necessary for the diagnosis Advance Beneficiary Notices (ABN) – If a provider performs a service not covered by Medicare, an ABN is completed – Must be signed by patient prior to procedure
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Medicaid Health insurance for limited or low-income individuals – Must use participating provider Funded by both state and federal governments – Eligibility requirements and benefits vary by state – Medicaid cards are issued each month – Always verify current coverage prior to visit
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Workers’ Compensation State laws which cover employees who are injured while working or as a result of work Benefits – Medical treatment in or out of a hospital – Temporary disability: may receive weekly cash benefits in addition to medical care – Permanent disability: weekly or monthly benefits, or a lump sum settlement – Payments to dependents for fatal injuries
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. TRICARE Beneficiaries – Active service personnel and their dependents – Retired active service personnel and their dependents – Dependents of service personnel who died in active duty
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. CHAMPVA Beneficiaries – Spouses and children of permanently disabled veterans – Spouses and children of veterans who died as a result of service
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Patients with No Insurance Classified as self-pay patients These patients are expected to pay at the time of service
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Primary and Secondary Insurance Patients may have more than one insurance plan Charges are filed first with the primary carrier, and then secondary – Coordination of benefits Dependent children and the Birthday rule
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Primary and Secondary Insurance Medicare and supplemental insurance – Many Medicare patients have supplemental or Medigap insurance – This covers the deductible and 20% coinsurance Medicare as secondary insurance – When a person qualifies for Medicare but is still employed
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Verifying Insurance Coverage Always ask patients for current insurance card Make a copy of the card, or scan into the EMR Verify coverage online or over the phone
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Utilization Review Preauthorization Precertification Predetermination Concurrent review Discharge planning
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Fee Schedules Providers enrolled in an insurance carrier’s network agrees to treat subscribers for an agreed upon (discounted) rate for services Accepting assignment: when providers accept the allowed amount as the rate for services – Disallowed amounts are written off as adjustments
Copyright ©2012 Delmar, Cengage Learning. All rights reserved. Fee Schedules Usual, customary, and reasonable (UCR) Resource-based relative value scale (RBRVS) Diagnostic-related groups (DRGs)