Health Insurance The BIG IDEAS Why is it

Health Insurance The BIG IDEAS

Why is it important? �Medical care is expensive �Insurance provides a pool of money to cover your expenses in exchange for a monthly fee. �ACA charges a fee to the uninsured in their taxes. Insurance is required by law.

How does health insurance work? �See video: how health insurance works �Basically the risk of large medical bill is spread out among a large group of people in the form of monthly premiums. �There’s power/protection in numbers, the healthy majority pay for the minority who incur major med. bills each year.

Sources for insurance 1. Government Sources: Medicare- citizens (5 yrs or more) over 65 yrs old, or disabled qualifying for social security. care/gap Medicaid- for lowincome, disabled, or needy individuals, needy families, & children. medicaid � 2. Employer Sources- employer covers some costs of health insurance premiums. � 3. Private Sources- individual purchase their own health insurance through private company.

Types of Insurance Plans � Indemnity (Pay per � Managed Care service/ PPS) � Limits you to providers � Allows you to seek within their “network” care from any qualified ◦ PPOs- Company shops for providers at different (licensed) provider facilities & in different � $$$$ neighborhoods. SOMETIMES more choice, more $$ ◦ HMO- Company limits you to providers AND facilities in network. Ex/ only Kaiser. Less choice, less $ ◦ HMO v PPO

Pre-existing condition � Insurance companies used to exclude people from coverage if they had a health condition before a policy was granted, due to risk � ACA makes this ILLEGAL. � As of 2014 all insurance co. must cover individuals w/ preexisting conditions. � & May not change rate based on P. E. C. � & May not charge more for women vs. men � pre-existing conditions video

Key Terms- Payments � Premiums- monthly payment for the privilege/purchase of health insurance ◦ You may pay it ◦ In group plans, your employer may pay some of this � Some plans can be deducted from paycheck before taxation, saves money. � Out of Pocket Costs: anything NOT reimbursed by insurance. � Deductible- what you have to pay before insurance kicks in each year � Copayment- flat fee for various services and prescriptions � Coinsurance- an agreed upon percentage you pay for care or prescriptions

How do deductibles and copays work? � See video: Terms! � The higher your deductible, the lower your premium � The higher your deductible, the lower your coinsurance % � Most managed care plans cover 100% of all preventative care costs (basic Vx, annual wellness check) � Copays and coinsurance are not the same thing. ◦ Expect copays for most doctor visits (except wellness) ◦ Coinsurance is a % you pay after your deductible is met until your out of pocket max is met. � Try the sample problems

Comparison of Insurance Plans Type of Health Plan Premium Selection of Physician Indemnity Plan High Flexibility to select a physician or specialist. *Many referrals needed *File your own claims/paperwork Managed Care HMO Relatively low Primary care physician refers the patient to specialist Managed Care PPO Low, but usually higher than HMO Greater number of physicians to choose from with PPO’s than HMO’s (depending on city) Copyright © Texas Education Agency, 2014. All rights reserved. 29

ACA/Obamacare Marketplace �ACA required creating a health marketplace that easily compares plans for consumers �Created a metal tier system (bronzeplatinum) �All plans are ranked on this system (most are HMOs and PPOs)

Consider if you have Consider for average healthcare frequent healthcare few healthcare needs Most adult Americans over 30 choose Silver Best for chronic health conditions

Disability Insurance The ability to earn a living is one of your most valuable assets. Disability insurance covers your wages if you are in an accident or too ill to work for an extended period of time. Copyright © Texas Education Agency, 2014. All rights reserved. 31

Create a Concept Map- Insurance � Organize the following terms in a meaningful flowchart or diagram. � Group like terms together or color code to show relationship � Utilize label lines as needed Example concept map: � Indemnity, Managed Care, Medicare, Medicaid, HMO, PPO, Copay, Deductible, Premium, Coinsurance � *Bonus- Metal Tiers