Types Of Health Policies

Forced all employers with 25 or more employees to offer HMOs. The main goal of this act was to prioritize preventative care. HMOs primary goal is to provide service instead of reimbursement.

A group of physicians and hospitals that contract with employers, insurers, and 3rd party organizations to provide medical care services at a reduced fee.

Employees are not locked into an HMO or PPO, they can choose to use either whenever they need. Copay will vary with service. Participants have access to options of in an out of network and what is covered. Does not have to have a PCP. If a non-member physician is utilized, the attending physician will be paid a fee for service, but the member patient will have to pay a higher Coinsurance amount.

A type of cafeteria plan benefit funded by salary reduction. Paid into by employers, does not roll over into next year. Can be used for medical or dental expenses for employees and their family members.

- Health Care account - For medical and dental

- Dependant Care account - for dependents

Same as FSA but DOES roll over to the next year.

Can only be given to those on a high deductible plan, CANNOT be on Medicare or be a dependent.

HSA holders 65 and older can withdrawal their HSA accounts for any reason, but they will be tax on it, plus a 20% penalty.

- Funds set aside by employers for employees to use for qualified medical expenses.

- Contribution plans, not defined benefit plans.

- Not a taxable employee benefit.

- Employers contributions are tax deductible

- Can roll over to next year

Addition to waiting periods where benefits will not be paid for illness-ralted disabilities. Applies only to sickness. Often a 10-30 day period.

Provide for the payment of income benefits generally in 3 different situations:

- When the insured is eligible for SS benefits but before they begin (usually a 5 month waiting period)

- If the insured has been denied coverage under SS (roughly 75% of those who apply are denied to due their rigid definition of total disability)

- When the amount payable under SS is less than the amount payable under the rider (in this case only the difference will be paid)

In business, overhead or overhead expense refers to an ongoing expense of operating a business. Overheads are the expenditure which cannot be conveniently traced to or identified with any particular revenue unit, unlike operating expenses such as raw material and labor.

A unique type of policy that is sold to small business owners who must continue to meet overhead expenses, such as rent, utilities, employee salaries, installment purchases, or leased equipment following a disability. Will NOT be reimbursed for salary or income. 15-30 day elimination period. Tax deductible, but taxable income if used.

Full face amount

A percentage of payout in ADAD policies

Provided for those who can no longer provide for themselves. Lasts for at least 12 consecutive months in a setting other than an acute setting in a hospital. Guaranteed renewable, insurers do have the right to increase premiums. Not covered by Medicare. Also called custodial care - includes medical and non medical care for people who have a chronic illness or disability.

Group formed for a purpose other than obtaining group health insurance. Typically two types, employer sponsored, and association group. Group disability income insurance is designed to only cover employees while they are off the job.

Designed to provide coverage for those in transition for 1-11 months. Not available to open enrollment. Cover physician services, surgical - outpatient and inpatient.

Coverage while confined to hospital (number of days) specific daily amount; fixed amount

Designed for preventative care

- Limited service area

- Copays

- Prepaid Basis

- PCP serves as gatekeeper

- PCP referrals required for specialists

- Limited choice of providers

- Does not contract with insurance companies

Waiting Period that lasts from the onset of disability or sickness until benefit payments starts

The longer the elimination period, the lower the cost of coverage

Every eligible member of group must be covered. Cost varies by ratio of males to females and the average age of the group. Evidence of insurability generally not required.

No deductible

Extent of benefits is determined by the insureds income

Deductible that must be paid between the basic and major medical policies

Group of physicians and hospitals that contract to provide services at a reduced fee. Members can use any physician they choose but are encouraged to use approved physicians who have previously agreed upon fees. Any physician or hospital that qualifies for and agrees to pay the established fees can be added to the PPO at anytime. They can also withdrawal at anytime.

Benefits will be coordinated when individuals are covered under two or more health plans.

In an HMO your PCP is your gatekeeper. The subscriber must choose a PCP to act as their gatekeeper. The gatekeeper helps control specialist costs by referring the subscriber to specialists.