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

2. 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.

3. 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

4. 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.

5. 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?

6. 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

7. 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

8. 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!

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

10. 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

11. 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.

12. 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.

13. 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.

14. 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…)

15. 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

16. 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