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35 Cards in this Set
- Front
- Back
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8–1 Describe essential terms related to health care plans.
Describe the following terms that relate to health care plans. Deductible |
Initial amount client must pay before insurance coverage begins
Its purpose is to decrease the cost of insurance; the higher the deductible, the lower the premium |
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8–1 Describe essential terms related to health care plans.
Describe the following terms that relate to health care plans. Coinsurance (participation percentage) |
Defines what portion of covered medical expenses is paid by the insured and what portion is paid by the plan, up to a maximum (or breakpoint)
Its purpose is to share the cost of the care so that insureds do not abuse the plan and seek unneeded professional medical care |
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8–1 Describe essential terms related to health care plans.
Describe the following terms that relate to health care plans. Stop-loss limit |
The amount of covered expenses, beyond the deductible, that is shared at the coinsurance rate
The purpose is to limit the amount of out-of-pocket costs for the individual |
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8–1 Describe essential terms related to health care plans.
Describe the following terms that relate to health care plans. Breakpoint |
The dollar amount of the deductible combined with the stoploss limit, which is the point after which an insurer begins to pay 100% of all covered medical expenses up to the plan maximum.
The purpose is to limit the amount of out-of-pocket costs for the individual |
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8–1 Describe essential terms related to health care plans.
Describe the following terms that relate to health care plans. Capitation |
The payment of an annual or monthly fee to providers, rather than the payment of a fee-for-service
With HMOs, comprehensive health care is provided in return for prenegotiated periodic payments Capitation also may be used by PPOs, PHOs, and POS plans |
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8–1 Describe essential terms related to health care plans.
What are the four main parts of Medicare, and what general coverage does each part offer? |
Part A: Hospital coverage
Part B: Physician’s and out-of-hospital coverage Part C: Medicare Advantage—alternatives to traditional Medicare Coverage Part D: Prescription drug coverage |
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8–1 Describe essential terms related to health care plans.
What major plan options are included under Medicare Advantage? |
Medicare HMOs
Medicare PPOs Private Fee-for-Service Plans Special Needs Plans Medicare MSA |
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8–1 Describe essential terms related to health care plans.
What is Medigap insurance and how is it used? |
Medigap insurance is a group of special policies designed by the NAIC and developed by commercial insurers and Blue Cross/Blue Shield as supplements to cover the gap between the cost of medical care and the amount Medicare pays. They also are known as Medicare supplement policies; generally they are the 10 NAIC designed plans
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Exclusions |
Medical services for which the policy specifically denies payment
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Preexisting conditions clause |
Excludes medical conditions that were treated previously or for which a prudent person would have sought treatment during some period of time before coverage began
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: |
Utilization review Proposed procedure is reviewed and authorized by the insurance company before it occurs or, in the case of an emergency, within a specified period of time afterward
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: UCR table or surgical schedule |
Maximum amount the insurer will pay for a service in a given Area
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Internal policy limits |
Limits for specific illnesses or procedures that fall below policy overall benefits
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Deductible |
The initial amount of covered expenses the insured must pay before insurance payments begin
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Coinsurance |
A provision requiring the insured to share a certain percentage of medical expenses (for example, 80/20 or 70/30)
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Stop-loss limit |
The cumulative dollar amount of covered expenses (in excess of the deductible) after which the client’s coinsurance payment stops and the insurer pays 100%
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Maximum benefit amount |
The largest dollar outlay the insurer will pay; may be a set number of dollars or may be unlimited
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Coordination of benefits clause |
A clause that restricts the insured from collecting under more than one policy in such a way as to recover more than 100% of medical costs
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8–2 Specify how medical plan provisions limit recovery by the insured.
Explain the 11 major medical insurance policy provisions limiting financial recovery by the insured: Supplemental coverages |
Modified or additional medical (or dental) coverage available for extra premium
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8–2 Specify how medical plan provisions limit recovery by the insured.
A client just had minor surgery as an outpatient. Assume she has a comprehensive major medical plan, she has already covered her deductible for the year, and her other medical expenses total more than her stop-loss limit. For what reasons might her health care plan limit what it will pay or deny the claim entirely? |
Her plan may require preauthorization for any surgery before the company will pay for it, except in an emergency. The procedure may not be covered. For example, most elective surgery is not covered.
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8–3 Compare characteristics of types of health care plans.
Identify the characteristics of each type of medical expense indemnity insurance plan: Hospital expense coverage |
Can be either hospital indemnity contracts, where all or some of room and board cost is paid, or hospital service contracts, where plan provides actual services of hospital for stated number of days rather than a cash benefit
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8–3 Compare characteristics of types of health care plans.
Identify the characteristics of each type of medical expense indemnity insurance plan: Surgical expense coverage |
Designed to pay a portion of physician’s fees for surgical care
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8–3 Compare characteristics of types of health care plans.
Identify the characteristics of each type of medical expense indemnity insurance plan: Physician’s Expense reimbursement insurance |
Designed to pay a portion of physician’s fees for nonsurgical care
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8–3 Compare characteristics of types of health care plans.
Identify the characteristics of each type of medical expense indemnity insurance plan: Major medical Coverage |
Has high limit per loss and is relatively free of exclusions; designed to protect against large losses; coverage takes over when base plan’s limits are met; contains a deductible, a coinsurance provision, and a stop-loss limit
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8–3 Compare characteristics of types of health care plans.
Identify the characteristics of each type of medical expense indemnity insurance plan: Comprehensive major medical coverage |
Same as major medical coverage, above, except that it is designed to be purchased as stand-alone coverage (without a base plan)
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8–3 Compare characteristics of types of health care plans.
Regarding hospital indemnity policies: What benefits are provided? |
Each policy pays a specified daily cash benefit for the time spent in a hospital. The benefit usually is limited to inpatient stays for accidents or specified illnesses.
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8–3 Compare characteristics of types of health care plans.
Regarding hospital indemnity policies: What is it about such plans that does not fit the normal concept of indemnity? |
The term indemnity implies that a person is “made whole”— that is, he or she is paid an amount equal to his or her loss. Hospital indemnity plans are cash payment plans, where the same amount is paid regardless of actual expenses incurred or reimbursement by other coverage.
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8–3 Compare characteristics of types of health care plans.
What are the advantages of comprehensive major medical insurance compared to those of health maintenance organizations? |
Comprehensive:
Very few exclusions for care required to treat illness or injury Typically has very high coverage limits Provides a wide choice of providers HMO: Provides for financing of health care and also delivers the care Provides comprehensive health care for copayments and a prenegotiated periodic payment (usually without a deductible or coinsurance) Preventive care usually is covered Usually costs less |
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8–3 Compare characteristics of types of health care plans.
What are the disadvantages of comprehensive major medical insurance compared to those of health maintenance organizations? |
Comprehensive:
The pure form seldom covers preventive care Insured has to pay initial bills out of pocket to cover the deductible Generally has a higher premium Usually has higher out-of-pocket costs unless many visits are made during the year HMO: Limited choice of providers May have a limited number of provider locations Generally must go through a gatekeeper physician For low cost visits, co-payment may exceed 80% of the cost of the visit |
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8–3 Compare characteristics of types of health care plans.
What is a preferred provider organization (PPO)? |
A PPO is an organization of doctors and/or hospitals with whom an employer or insurance company contracts to provide medical services at a negotiated discount to members.
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8–3 Compare characteristics of types of health care plans.
How are health care plans that include PPOs different than HMOs? |
Under a PPO plan, insureds may not be required to go to the PPO physicians or hospitals, and PPO physicians and hospitals may be paid on a fee-for-service basis, particularly the specialists. Although many HMO providers are employees of the HMO, no PPO provider is an employee of the PPO.
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8–3 Compare characteristics of types of health care plans.
What are the characteristics that distinguish major medical insurance from other forms of medical expense coverage? |
a high limit per loss
the relative absence of exclusions the deductible the coinsurance provision the breakpoint (stop-loss limit) |
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8–5 Explain HIPAA provisions related to health insurance.
What primary provision of HIPAA was established to reduce “job lock”? |
The primary provision of HIPAA that was intended to reduce job lock is the provision that once a person has met the preexisting conditions clause of one policy, when he or she changes jobs and gets new health coverage, no new preexisting conditions clause will apply.
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8–5 Explain HIPAA provisions related to health insurance.
Under what circumstances does HIPAA prohibit a plan from applying a 12-month preexisting conditions exclusion? |
if a new employee was covered for 12 months under a prior plan (18 months for a late enrollee), as long as the employee had no more than a 63-day break in coverage between the prior coverage and the new coverage
if an employee had less than 12 months’ coverage under a prior plan, the preexisting conditions exclusion is reduced one day for each day under the prior plan if a plan has a waiting period for new hires, the preexisting conditions exclusion must be reduced by the number of days equal to the waiting period |
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What plan types are not covered by HIPAA health care plan rules?
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accident-only policies (including accidental death and dismemberment policies)
disability income insurance supplements to liability policies workers’ compensation or similar insurance medical payments coverage under homeowners or automobile insurance policies credit insurance coverage for on-site medical clinics limited-scope dental or vision products when they are offered through a separate plan or are not an integral part of the health Plan long-term care insurance specified-disease policies that are separate contracts and/or are not coordinated with the comprehensive health care plan any other limited coverage exempted from rules by regulations; so far, no others have been exempted |
