Health Insurance Traditional Fee For Service Coverage Blue Cross Blue Shield Plans Health Maintenance Organizations Preferred Provider Organizations Point of Service Plans Current Health Care Concerns Traditional Fee For Service Coverage Benefits Indemnity Service Valued policy Basic benefits Hospital Surgical Medical expenses Traditional Fee For Service Coverage continued Major medical insurance Maximum limits Internal limits Benefit period Coinsurance Stop loss provisions Limited contracts Accident of specified illness Policy Provisions Coordination of benefits Continuation provisions COBRA 1985 Blue Cross Blue Shield Plans Not for profit organizations Hospitals and physicians formed these insurance plans Tax favored organizations Reimburse hospitals at a discounted rate Competition for traditional health insurers Health Maintenance Organizations HMOs Prepaid health care coverage Incentives of HMOs versus Fee for service plans Advantages disadvantages of HMOs Choice of Doctor Coverage for Checkups and Preventative Care Out of Area Service Filing Claims Preferred Provider Organizations PPOs Coverage provider negotiates discounts with doctors and hospitals Insured can choose PPO for better coverage Introduces competition into health care Point of Service Plans POS Hybrid arrangement combining a traditional fee forservice plan with an HMO and or a PPO Whenever health care is required participant can choose the managed care option or an alternative health care provider Higher coverage for managed care Reduced coverage for out of network treatment Fastest growing health care plan for employees Health Care Coverage 1 What health care coverage do you have A Own coverage through employer B Coverage through a parent s policy C Coverage through the U of I Student Plan D Coverage through parent s and U of I Plan E No coverage I don t know Health Care Coverage 2 What type of health care coverage do you have A Traditional fee for service or BCBS B HMO C PPO D POS E I don t know Current Problem Areas Health care costs Managed care problems Physician compensation and control Health Care Costs in US Total health care spending 1 9 trillion 2004 Up 7 9 3 times rate of inflation 6 280 per person 16 of GDP Higher than any other industrialized nation Other nations provide universal coverage 46 million uninsured at least part of year Fastest rising cost for employers 11 annual increase 2001 2005 10 880 for family 4 024 for individual 2005 Managed Care Problems Getting treatment for serious ailment Primary care provider may be reluctant to refer patient to a specialist Plan may refuse to cover expensive treatment No coverage for out of network care Under fee for service physicians were paid only if they provided a service Problem over treatment Under managed care physicians have an incentive to keep treatment costs down Problem under treatment Potential conflict of interest for physicians Physician Compensation and Control Starting compensation levels 2006 General practitioners 140 000 150 000 Specialists Radiologists Cardiologists Orthopedic Surgeons 260 000 400 000 Financial incentive for physician to become a specialist Conflicts between physician and managed care plans Delays in approving care Denial of coverage Paperwork requirements Physician satisfaction levels declining
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