1. Chapter 3: Basic of Health Insurance
Lesson 2_Topic 2
Categories of Health Insurance

2. Three Classes of Health Insurance
Group Contract
any insurance plan by which a homogeneous groups is insurer under a singled policy issued to their employer/leader, with individual certificates for each member
For example: An employer offering group medical insurance to their employees.
What is a blanket contract? (Comprehensive group insurance coverage through plans sponsored by professional associations for their members)
COBRA is the law requiring companies of 20 or more employees to extend insurance coverage to laid off workers for up to 18 months.
Three Classes of Health Insurance
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3. Group Contract Continued…
Blanket Contract
Comprehensive group insurance coverage through pans sponsored by professional associations for their members (For example: AMA)
If a member leaves the associations, they can enroll in an individual contract (conversion privilege)
Less benefits
Higher premiums
Group Contract Continued…

4. Group Contract Continued…
COBRA
For companies with 20 or more workers
If an employee is laid off from work, they may purchase group health insurance benefits from their employers
Includes reduction in work hours
Covered at group rates for 18 months
Income continuation benefits
Group Contract Continued…

5. Group Contract Continued…
Medical Savings Accounts (MSA)
Tax-free saving account that allows individuals and their employers to set aside money to pay for health care expenses.
Health Savings Accounts (HSA)
Tool to control medical expenses for individuals with high-deductible health plans
Tax-free when used for qualifying medical expenses
Rolled over year to year
Group Contract Continued…

6. Three Classes of Health Insurance
Individual Contract
Also called personal insurance
an individual contract is specific to an individual and/or dependents
Benefits can be specific for patients needs
Typically has higher premiums and deductibles
Three Classes of Health Insurance

7. Three Classes of Health Insurance
Prepaid Health Plan
a prepaid health plan is a program in which a specific set of health benefits is provided for a subscriber(s)
pays a yearly fee or fixed periodic payments
Capitation:
System of payment used by MCO
Physicians are paid a fixed amount per patient over a period of time
Three Classes of Health Insurance

8. Dr. Martin is paid capitation for 50 patients in her practice
Dr. Martin is paid capitation for 50 patients in her practice. The per capita amount is $20.00 per patient. She receives capitation every 3 months.
With capitation, no matter how many times Dr. Martin sees/exams these patients, she will still only receive $20.00 per patient, per quarter.
Patient A is seen 5 times in 3 months: $20.00
Patient B is NOT seen at all in 3 months: $20.00
Capitation Example