Chapter 13 Healthcare Plans 04 28 2014 Health Care Plans Health Care Goods and Services Typical Health Transaction 1 Seller of Health Care Goods and Services i Insurance companies Hospital Physicians 2 Buyers of Health Care Goods and Services i Employees Patients Insured Customers 3 Entity that Pays For Health Care Goods and Services i Usually 3rd Party Employer ii Government Federal State 1 Medicade Low Income 2 Medicare Senior Citizen 3 Veterans Administration Incentives Patient Buyer Insured o Individuals who have health insurance use Health Care Goods and Services more than those that don t Provider Traditional Indemnity Plan Payment System paid fee for service Every procedure Physicians charged fee o Every charge was paid o LOTS of procedures No incentive not to o Physicians Loved this Insurance Companies hated it o Over utilization by patient consumer o Employer paid premium that were experience rated o Everything changed o 1980 s 95 of employees traditional indemnity model o Today Less than 3 use the fee for service model Managed Care Plans Employees chose healthcare provider o Usually a CO Pay involved 80 20 Leading up to Managed Care Plan o Charge 1 000 Insurance Company Paid charge 980 800 200 Physician accepted Insurance company payment as payment in full No management by Insurance company Managed Care Plan a Types of Managed Care Plans i HMO ii PPO iii POS 1 Health Maintenance Organization HMO a Gate Keeper Eliminated moral hazard to some degree for some physicians b Primary Care Physicians Referral c Fee For Service Gone However Moral Hazard is not because there is an incentive for Gate Keeper d Primary Care Physician Specific Hospital Network of Doctors refer to Doctors in network i Out of network NO COVERAGE Originally ii Now Some Coverage 1 Moral Hazard for Primary Care Physician who may not want to make referrals 2 Medical malpractice went way up 2 Disadvantages of HMO a Change Doctors b Quality of care is reduced c Emphasis of care is reduced d Less Access to specialists i Tests not performed ii Patients not being hospitalized e Medical Malpractice went up Patients Customers not happy f HMO s restricted Doctors freedom to treat patients Clearance for tests g Pormission h Doctor has to argue for additional days in the hospital i Women who have C Sections 2 days ii Normal Delivery Discharged in less than 24 hours iii NOW Insurance has to pay for 3 days in the hospital after a C Section 3 Modifications i HMO s were providing bonuses to doctors who kept costs down a PPO Preferred Provider Organization i Contracts by insurance company with doctors called Preferred Providers ii Provided service to patients at a discount from full charges iii Agreed to accept the PPO payment in full 1 Normal Charge 100 2 PPO Agree 75 3 Patient 10 a Total 85 iv Use Network v Small out of pocket charge to patient vi Covered in Full vii Some Coverage out of Network 1 NO referral in network 04 28 2014 04 28 2014
View Full Document
Unlocking...