Health Insurance and Managed Care. RMI 3500 Intro. to Risk Mang. & Ins. Robert Klein. Revised 10-7-07. Topic Objectives . Understand major health care problems. Describe basic medical expense coverages. Explain major medical insurance in detail. Explain purpose/motivation of managed care.
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Intro. to Risk Mang. & Ins.
Large Number of Uninsured
Waste and Inefficiency
More Treatable Conditions
Tax SubsidyHealth Care Financing Problems
“Our current medical plan offers a 3-day stay for a bullet in the groin or torso, a 2-day stay for a bullet in an extremity and an overnight for superficial wounds.”
“Your husband will receive the best care known to medical coverage.”
“Good news, hon! Your treatment has been authorized.”
Broad coverage with low deductibles and copays
Prepaid health coverage
Doctors not compensated by fee-for-service
Capitation – set fee per insured, patient, or procedure
Other cost controls:
most limited choice of providers
gatekeepersHealth Maintenance Organizations (HMOs)
“Very scary Jennifer – does anyone
else have an HMO horror story?”
Lower deductibles, lower copayments
No claim forms to file
Less freedom to choose doctor
What do you do when you are outside the area?
Quality of care?Pros/Cons of HMOs
“We’re in HMOs - the closest to legit we’ve been in years.”
Doctors who contract with insurer or group to offer services at reduced rates.
Not the same as HMO
Doctors paid by negotiated fee
Insured chooses provider within PPO
Lower cost than indemnity plans
Greater choice than HMOs
Help new doctors build up practices
Only works well with large groups
More expensive than HMOs
Limited to PPO providersPreferred Provider Organizations
Point-of-Service at reduced rates.
combines HMO or PPO with greater provider choice
In-network care fully reimbursed.
Out-of-network services option subject to deductible and large copay.
Owned by providers
Response to HMO & PPO controls
Hold harmless clause
Providers encountering cost vs. quality of care issueOther Managed Care Plans
“Uninsured? That won’t be a problem.
We can refer you to a very good doctor in Ottawa.”
$50,000-$80,000 cost per year.
Includes skilled/immediate nursing, custodial and home health care.
Aggregate benefits; elimination periods.
Inflation protection, renewability.
Expensive; rates rise exponentially with age at inception of policy.
viability of insurerLong-Term Care Insurance