RMI 2101 Topic 11 with Complete Solutions

RMI 2101 Topic 11 with Complete Solutions Issues of employer provided healthcare benefits High cost of health care -High cost of inflation compared to overall rate of inflation -High premiums for employers -High costs for governments High % of uninsured or underinsured patients -Access problem -45 million uninsured pre Obama Care Indemnity Plans Old School Plan Covers room cost of hospital, surgeon's fees, and follow-up visits Gaps in Indemnity Plans Non-hospital based expenditures not covered, even hospital stays had limited coverage, balance billing (owe hospital amounts not covered by insurance+ Major Medical Covers routine, non-hospital based expenses NOT covered by basic indemnity plan. Has higher limits for hospital stays. Few exclusions, allows for cost sharing (deductibles, coinsurance) HMOs Health Maintenance Organizations, Managed Care Plans Removes incentives present under fee-for-service plans to do more rather than less. Does not always pay providers more for doing more. HMO places providers/hospitals at financial risk for over utilization, providers also cannot balance bill Staff Model HMOs Physicians are employees of the HMO, paid a salary, only see HMO patients Group Model HMOs Physicians are employees of a separate practice or part owners in the group practice. HMO enrolls individuals and contracts with the group practice to take care of HMO patients Group practice can see HMO or non-HMO patients Disadvantages to HMOs May have to change providers to join HMO No coverage for out-of-plan utilization PPOs (Preferred Provider Organization) Have contracts with preferred providers (doctors, hospital, etc.), agree to accept PPO payment and any deductibles or copayments as payments in full Discount services Cannot balance bill You can go out of network and get coverage Consumer Directed Health Plan (CDHP) Designed to engage people to make decisions on health and wellness based on consumerism. You can buy healthcare products like other products (car, home) Forces employees to be aware of costs 80/20 Rule 80% of the cost only comes from 20% of the population Patient Protection and Affordable Care Act (Obamacare) -Dependents are covered to age 26 -Lifetime limits are banned