Health insurance

Health insurance

From Wikipedia, the free encyclopedia
Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care and health system expenses, among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is available to pay for the health care benefits specified in the insurance agreement. The benefit is administered by a central organization such as a government agency, private business, or not-for-profit entity. According to the Health Insurance Association of America, health insurance is defined as "coverage that provides for the payments of benefits as a result of sickness or injury. Includes insurance for losses from accident, medical expense, disability, or accidental death and dismemberment" (pg. 225).[1]

Background[edit]

A health insurance policy is:
  1. A contract between an insurance provider (e.g. an insurance company or a government) and an individual or his/her sponsor (e.g. an employer or a community organization). The contract can be renewable (e.g. annually, monthly) or lifelong in the case of private insurance, or be mandatory for all citizens in the case of national plans. The type and amount of health care costs that will be covered by the health insurance provider are specified in writing, in a member contract or "Evidence of Coverage" booklet for private insurance, or in a national health policy for public insurance.
  2. Provided by an employer-sponsored self-funded ERISA plan. The company generally advertises that they have one of the big insurance companies. However, in an ERISA case, that insurance company "doesn't engage in the act of insurance", they just administer it. Therefore ERISA plans are not subject to state laws. ERISA plans are governed by federal law under the jurisdiction of the US Department of Labor (USDOL). The specific benefits or coverage details are found in the Summary Plan Description (SPD). An appeal must go through the insurance company, then to the Employer's Plan Fiduciary. If still required, the Fiduciary’s decision can be brought to the USDOL to review for ERISA compliance, and then file a lawsuit in federal court.
The individual insured person's obligations may take several forms:[2]
  • Premium: The amount the policy-holder or his sponsor (e.g. an employer) pays to the health plan to purchase health coverage.
  • Deductible: The amount that the insured must pay out-of-pocket before the health insurer pays its share. For example, policy-holders might have to pay a $500 deductible per year, before any of their health care is covered by the health insurer. It may take several doctor's visits or prescription refills before the insured person reaches the deductible and the insurance company starts to pay for care. Furthermore, most policies do not apply co-pays for doctor's visits or prescriptions against your deductible.
  • Co-payment: The amount that the insured person must pay out of pocket before the health insurer pays for a particular visit or service. For example, an insured person might pay a $45 co-payment for a doctor's visit, or to obtain a prescription. A co-payment must be paid each time a particular service is obtained.
  • Coinsurance: Instead of, or in addition to, paying a fixed amount up front (a co-payment), the co-insurance is a percentage of the total cost that insured person may also pay. For example, the member might have to pay 20% of the cost of a surgery over and above a co-payment, while the insurance company pays the other 80%. If there is an upper limit on coinsurance, the policy-holder could end up owing very little, or a great deal, depending on the actual costs of the services they obtain.
  • Exclusions: Not all services are covered. The insured are generally expected to pay the full cost of non-covered services out of their own pockets.
  • Coverage limits: Some health insurance policies only pay for health care up to a certain dollar amount. The insured person may be expected to pay any charges in excess of the health plan's maximum payment for a specific service. In addition, some insurance company schemes have annual or lifetime coverage maxima. In these cases, the health plan will stop payment when they reach the benefit maximum, and the policy-holder must pay all remaining costs.
  • Out-of-pocket maxima: Similar to coverage limits, except that in this case, the insured person's payment obligation ends when they reach the out-of-pocket maximum, and health insurance pays all further covered costs. Out-of-pocket maxima can be limited to a specific benefit category (such as prescription drugs) or can apply to all coverage provided during a specific benefit year.
  • Capitation: An amount paid by an insurer to a health care provider, for which the provider agrees to treat all members of the insurer.
  • In-Network Provider: (U.S. term) A health care provider on a list of providers preselected by the insurer. The insurer will offer discounted coinsurance or co-payments, or additional benefits, to a plan member to see an in-network provider. Generally, providers in network are providers who have a contract with the insurer to accept rates further discounted from the "usual and customary" charges the insurer pays to out-of-network providers.
  • Prior Authorization: A certification or authorization that an insurer provides prior to medical service occurring. Obtaining an authorization means that the insurer is obligated to pay for the service, assuming it matches what was authorized. Many smaller, routine services do not require authorization.[3]
  • Explanation of Benefits: A document that may be sent by an insurer to a patient explaining what was covered for a medical service, and how payment amount and patient responsibility amount were determined.[3]
Prescription drug plans are a form of insurance offered through some health insurance plans. In the U.S., the patient usually pays a copayment and the prescription drug insurance part or all of the balance for drugs covered in the formulary of the plan. Such plans are routinely part of national health insurance programs. For example in the province of Quebec, Canada, prescription drug insurance is universally required as part of the public health insurance plan, but may be purchased and administered either through private or group plans, or through the public plan.[4]
Some, if not most, health care providers in the United States will agree to bill the insurance company if patients are willing to sign an agreement that they will be responsible for the amount that the insurance company doesn't pay. The insurance company pays out of network providers according to "reasonable and customary" charges, which may be less than the provider's usual fee. The provider may also have a separate contract with the insurer to accept what amounts to a discounted rate or capitation to the provider's standard charges. It generally costs the patient less to use an in-network provider.

Notes and references[edit]

  1. Jump up^ How Private Insurance Works: A Primer by Gary Caxton, Institution for Health Care Research and Policy, Georgetown University, on behalf of the Henry J. Kaiser Family Foundation.
  2. Jump up^ Agency for Health care Research and Quality (AHRQ). "Questions and Answers About Health Insurance: A Consumer Guide." August 2007.
  3. ^ Jump up to:a b Prior Authorizations. Healthharbor.com. Retrieved on 2011-10-26.
  4. Jump up^ Regie de l'assurance maladie du Quebec. Prescription drug insurance.Accessed 3 June 2011.
  5. Jump up^ Health insurance almanac. Detailed descriptions for health insurance related terms
  6. Jump up^ "Mirror, Mirror on the Wall: An International Update on the Comparative Performance of American Health Care". The Commonwealth Fund. May 15, 2007. Retrieved March 7, 2009.
  7. ^ Jump up to:a b c Schoen C et al. (2010). How Health Insurance Design Affects Access To Care And Costs, By Income, In Eleven Countries. Health Affairs. Free full-text.
  8. Jump up^ Australian Health Insurance Information. PrivateHealth.gov.au. Retrieved on 2011-10-26.
  9. Jump up^ PHIO's Annual Reports. Phio.org.au. Retrieved on 2011-10-26.
  10. Jump up^http://www.privatehealth.gov.au/healthinsurance/incentivessurcharges/mls.htm
  11. Jump up^ Parlininfoweb.aph.gov.au
  12. Jump up^ Medicare levy surcharge effect 'trivial': inquiry. ABC.net.au (2008-08-12). Retrieved on 2011-10-26.
  13. Jump up^ Middle class, middle income and caught in the cross-hairs as Labor turns its sights on a welfare crackdown. Theage.com.au (2011-05-01). Retrieved on 2011-10-26.
  14. Jump up^ Development, Organisation for Economic Co-Operation and (2004). Private Health Insurance in OECD Countries. OECD Health Project. ISBN 978-92-64-00668-3. Retrieved 2007-11-19.
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  17. Jump up^ "L'assurance maladie".
  18. Jump up^ John S. Ambler, "The French Welfare State: surviving social and ideological change," New York University Press, 30 September 1993, ISBN 978-0-8147-0626-8.
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  20. ^ Jump up to:a b World Health Organization Statistical Information System: Core Health Indicators. Who.int. Retrieved on 2011-10-26.
  21. Jump up^ Gesetzliche Krankenversicherungen im Vergleich(English Translation)
  22. Jump up^ Length of hospital stay, Germany. Group-economics.allianz.com (2005-07-25). Retrieved on 2011-10-26.
  23. Jump up^ Length of hospital stay, U.S. Cdc.gov. Retrieved on 2011-10-26.
  24. Jump up^ Borger C, Smith S, Truffer C et al. (2006). "Health spending projections through 2015: changes on the horizon". Health Aff (Millwood) 25 (2): w61–73.doi:10.1377/hlthaff.25.w61. PMID 16495287.
  25. Jump up^ SOEP – Sozio-oekonomische Panel 2006: Art der Krankenversicherung
  26. Jump up^ "Vergleich Gesetzliche Private" comparison public and private health insurance (English Translation)
  27. Jump up^ Information of the Bundesgesundheitsministeriums around members and insured persons in the GKV Januar und Februar 2012 abgerufen am 26. März 2012
  28. Jump up^ Details about Pflegeversicherung
  29. Jump up^ Wisman, Rosann; Heller, John; Clark, Peggy (2011). "A blueprint for country-driven development". The Lancet 377 (9781): 1902–3. doi:10.1016/S0140-6736(11)60778-2. PMID 21641465.
  30. Jump up^ Carrin G et al. "Universal coverage of health services: tailoring its implementation." Bulletin of the World Health Organization, 2008; 86(11): 817–908.
  31. Jump up^ Schwartz, Nelson D. (1 October 2009). "Swiss health care thrives without public option". The New York Times. p. A1.
  32. Jump up^ HM Treasury (2007-03-21). "Budget 2007" (PDF). p. 21. Retrieved 2007-05-11.
  33. Jump up^ BUPA exclusions.
  34. Jump up^ BMA policies – search results. British Medical Association. Retrieved on 2011-10-26.
  35. Jump up^ "Survey of the general public's views on NHS system reform in England"(PDF). BMA. 2007-06-01.
  36. Jump up^ Health Insurance Coverage. Centers for Disease Control and Prevention. CDC.gov (2011-03-06). Retrieved on 2011-10-26.
  37. Jump up^ Torio CM, Andrews RM. National Inpatient Hospital Costs: The Most Expensive Conditions by Payer, 2011. HCUP Statistical Brief #160. Agency for Healthcare Research and Quality, Rockville, MD. August 2013. [1]
  38. Jump up^ Torio CM, Andrews RM. National Inpatient Hospital Costs: The Most Expensive Conditions by Payer, 2011. HCUP Statistical Brief #160. Agency for Healthcare Research and Quality, Rockville, MD. August 2013. [2]
  39. Jump up^ U.S. Census Bureau, "CPS Health Insurance Definitions".
  40. Jump up^ Himmelstein, D. U.; Thorne, D.; Warren, E.; Woolhandler, S. (2009). "Medical Bankruptcy in the United States, 2007: Results of a National Study". The American Journal of Medicine 122 (8): 741–746.doi:10.1016/j.amjmed.2009.04.012. PMID 19501347. See full text.
  41. Jump up^ Siska, A, et al, Health Spending Projections Through 2018: Recession Effects Add Uncertainty to The Outlook Health Affairs, March/April 2009; 28(2): w346-w357.
  42. Jump up^ Howstuffworks: How Health Insurance Works.
  43. Jump up^ "Encarta: Health Insurance". Archived from the original on 2009-10-31.
  44. Jump up^ See California Insurance Code Section 106 (defining disability insurance).Caselaw.lp.findlaw.com In 2001, the California Legislature added subdivision (b), which defines "health insurance" as "an individual or group disability insurance policy that provides coverage for hospital, medical, or surgical benefits."
  45. ^ Jump up to:a b Fundamentals of Health Insurance: Part A, Health Insurance Association of America, 1997, ISBN 1-879143-36-4.
  46. Jump up^ People ex rel. State Board of Medical Examiners v. Pacific Health Corp., 12 Cal.2d 156 (1938).
  47. Jump up^ Thomas P. O'Hare, "Individual Medical Expense Insurance," The American College, 2000, p. 7, ISBN 1-57996-025-1.
  48. Jump up^ Managed Care: Integrating the Delivery and Financing of Health Care – Part A, Health Insurance Association of America, 1995, p. 9 ISBN 1-879143-26-7.
  49. Jump up^ "Comprehensive Health Insurance vs. Scheduled Health Insurance".
  50. Jump up^ "Mini Medical Plans On The Move".
  51. ^ Jump up to:a b The Factors Fueling Rising Healthcare Costs 2006, PricewaterhouseCoopers for America's Health Insurance Plans, 2006, accessed 2007-10-08.
  52. Jump up^ Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans, 2010, pg.205
  53. Jump up^ Robert E. Wright, Fubarnomics: A Lighthearted, Serious Look at America's Economic Ills (Buffalo, N.Y.: Prometheus, 2010).
  54. Jump up^ Health Insurance. Health Insurance (2011-07-15). Retrieved on 2011-10-26.
  55. Jump up^ CHIS 2007 Survey
  56. Jump up^ OPA.ca.gov[dead link]
  57. Jump up^ OPA, About California's Patient Advocate
  58. Jump up^ Health Care in America: Trends in Utilization. National Center for Health Statistics (2003). CDC.gov

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