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Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
Why insure health care?
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Why insure health care?

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Why insure health care? …

Why insure health care?
The answer to this question is fundamental to health care reform, insurance coverage, medical practice, and the cost of health care..

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  • 1. THE PURPOSE OF HEALTH INSURANCE IS TO MANAGE….
  • 2. PURCHASING HEALTH INSURANCE INVOLVES…
  • 3. PEOPLE EXPERIENCING A SMALL, CERTAIN LOSS… (KNOWN AS THE PREMIUM)
  • 4. IN EXCHANGE FOR RELIEF FROM RISK OF A LARGE UNPREDICTABLE LOSS. (DUE TO ACCIDENT OR MAJOR ILLNESS)
  • 5. PERSON INSURER BUYS SELLS INSURANCE PROTECTION FROM FROM RISK RISK
  • 6. PERSON PAYS PREMIUM PERSON INSURER BUYS SELLS INSURANCE PROTECTION FROM FROM RISK RISK INSURER WRITES A POLICY
  • 7. THE INSURED ARE PROTECTED AT A REASONABLE COST AND THE INSURER MAKES SOME MONEY
  • 8. B Y S P R E A D I N G T H E R I S K & BY CONTROLLING THE RISK
  • 9. WITH WHOM? • CO-PAYS & CO-INSURANCE PATIENTS • DEDUCTABLES PROVIDERS • RISK SHARING CONTRACTS OTHER • REINSURANCE INSURERS
  • 10. WITH WHOM? • CO-PAYS & CO-INSURANCE PATIENTS • DEDUCTABLES Co-payment – fixed amount of total cost that must be paid by the insured each PROVIDERS • RISK SHARING CONTRACTS time a medical service is used Co-insurance – a fixed percentage of the total cost that must be paid for each OTHER insured medical service • REINSURANCE Deductable – a fixed amount that must INSURERS be paid by the insured before insurance takes effect
  • 11. Risk sharing contract – an agreement WITH WHOM? between an insurer and a provider in which the provider assumes risk for treatment in some way. Typically, the provider will receive a fixed payment per • CO-PAYS & CO-INSURANCE PATIENTS patient and assume any costs for • DEDUCTABLES treatment above that fixed payment. PROVIDERS • RISK SHARING CONTRACTS OTHER • REINSURANCE INSURERS
  • 12. WITH WHOM? Re-Insurance –insurance purchased by an insurer from another insurer (i.e., reinsurer) for the purpose of transferring risk from the insurer to the reinsurer. The reinsurer agrees to pay CO-PAYS & CO-INSURANCE • the insurer PATIENTS when insurer’s losses exceed a specified • DEDUCTABLES amount. PROVIDERS • RISK SHARING CONTRACTS OTHER • REINSURANCE INSURERS
  • 13. BY CONTROLLING THE PROBABILITY, SEVERITY, AND COSTS OF
  • 14. PROBABILITY & SEVERITY OF EVENTS MAY BE REDUCED WITH…
  • 15. BETTER WELLNESS QUALITY ADHERENCE TO PROGRAMS IMPROVEMENT THERAPY MEDICATION DISEASE & APPLICATION UTILIZATION CASE OF REVIEW MANAGEMENT TECHNOLOGY EVIDENCE PATIENT PAY FOR BASED ENGAGEMENT PERFORMANCE MEDICINE
  • 16. BETTER WELLNESS QUALITY ADHERENCE TO PROGRAMS IMPROVEMENT THERAPY MEDICATION MANAGED CARE & THESE DISEASE METHODSAPPLICATION UTILIZATION IMPROVE CASE INCREASE OF SEEK TO ACCESS, REVIEW OF CARE, AND/OR LOWER COST QUALITY MANAGEMENT TECHNOLOGY EVIDENCE PATIENT PAY FOR BASED ENGAGEMENT PERFORMANCE MEDICINE
  • 17. CONTROLLING COSTS REQUIRES INFLUENCING SPENDING ON…
  • 18. • DRUGS PRODUCTS • SUPPLIES • TECHNOLOGY • PHYSICIAN SERVICES • HOSPITALS • LONG TERM CARE • OF EXISTING PRODUCTS & SERVICES UTILIZATION • OF NEW PRODUCTS & SERVICES
  • 19. CONTROLLING HEALTH CARE COSTS CAN BE SUMMARIZED WITH THE FOLLOWING EQUATION…
  • 20. Total Health Care Costs =ƒ (Price, Volume, Intensity) Ƒ = function(i.e. is determined by) Price = amount charged for services and/or products Volume = number of units of service and/or products Intensity = amount of energy or effort used
  • 21. WHICH MEANS…
  • 22. Total Health Care Costs =ƒ (Price, Volume, Intensity) Ƒ = function(i.e. is determined THE PRICE PAID, TOTALS COSTS ARE CAUSED BY by) THE VOLUME USED, AND THE INTENSITY OF Price = amount charged for services and/or products HEALTH CARE PROVIDED. CONTROLLING ONLY ONE (E.G., PRICE) WILL BE POINTLESS WITHOUT CONTROLLING THE OTHERS. Volume = number of units of service and/or products Intensity = amount of energy or effort used
  • 23. FOR EXAMPLE…
  • 24. CONTROLLING PHARMACEUTICAL EXPENDITURES REQUIRES CONTROLLING THE PRICE OF DRUGS, VOLUME OF DRUGS USED, AND INTENSITY OF CARE (E.G., USING A CHEAPER GENERIC DRUG INSTEAD OF A NEW BRAND NAME THERAPEUTIC EQUIVALENT).
  • 25. THE PURPOSE OF HEALTH INSURANCE IS TO MANAGE…
  • 26. PERSON FOR INSURER PAYS A PROTECTION SMALL, FROM CERTAIN POTENTIAL
  • 27. INSURERS CONTROL THEIR RISK BY…
  • 28. S P R E A D I N G & CONTROLLING THE RISK
  • 29. WITH…
  • 30. RISK SHARING • CO-PAYS & CO-INSURANCE PATIENTS • DEDUCTABLES PROVIDERS • RISK SHARING CONTRACTS OTHER • REINSURANCE INSURERS
  • 31. AND WITH…
  • 32. BETTER WELLNESS QUALITY ADHERENCE TO PROGRAMS IMPROVEMENT THERAPY MEDICATION DISEASE & APPLICATION UTILIZATION CASE OF REVIEW MANAGEMENT TECHNOLOGY EVIDENCE PATIENT PAY FOR BASED ENGAGEMENT PERFORMANCE MEDICINE
  • 33. INSURERS CONTROL COSTS ALSO BY USING…
  • 34. BETTER WELLNESS QUALITY ADHERENCE TO PROGRAMS IMPROVEMENT THERAPY MEDICATION DISEASE & APPLICATION UTILIZATION CASE OF REVIEW MANAGEMENT TECHNOLOGY EVIDENCE PATIENT PAY FOR BASED ENGAGEMENT PERFORMANCE MEDICINE
  • 35. WHICH HELP CONTROL
  • 36. (Price, Volume, Intensity)
  • 37. QUESTIONS?

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