Health insurance in the US has evolved from primarily covering catastrophic illness to also covering preventative care and services. There are various types of health insurance plans including HMOs, PPOs, and consumer-driven plans. Government plans like Medicare and Medicaid provide coverage for specific groups. Providers must verify a patient's insurance coverage and submit claims according to the insurer's requirements to receive reimbursement.

1. Heath Insurance

2. Evolution of Health Insurance
• Historically, health insurance provided coverage
for catastrophic illness and injury
• It has evolved into coverage for preventative care
and services
• The traditional type of insurance is fee-for-
service care

3. Managed Care Delivery Systems
• This system integrates the delivery and payment
of health care by contracting with select
providers for a reduced cost
• The goal is to provide health care with an
emphasis on prevention

4. Types of Insurance Plans
• Commercial health insurance plans
• Indemnity-type insurance
• Health maintenance organizations (HMOs)
• Preferred Provider Organization (PPO)
•
• Consumer-driven health plans (CDHPs)
• Government health plans

5. HMOs
• Provide comprehensive health care with a focus
on preventative care
▫ Annual physicals and PAP tests, well-child care
• Members choose a Primary Care Provider (PCP)
to oversee medical care
▫ PCP refers to a specialist, if needed

6. PPO, POS, IPA
▫ Preferred provider organization (PPO)
 Members must select a PCP
 Network of providers that provide services to members at
a discounted rate (in-network)
 Members pay more out of pocket for out-of-network
providers
▫ Point-of-service (POS) plans
 Members do not select a PCP and can self-refer to
specialist
▫ Independent practice associations (IPAs)
 Providers who practice in their own offices with their own
staff

7. Consumer Driven Health Plans:DHPs
• Health savings account (HSA)
▫ Must be paired with a qualified health plan
• Health reimbursement account (HRA)
▫ Employers contribute to HRA (not employees)
• Flexible spending account (FSA)
▫ Employees contribute to FSA
▫ Can pay for health insurance premiums, qualified
medical expenses, dependent expenses

8. CDHP’s
• Flexible spending account (FSA)
▫ Components
 Health insurance premiums
 Qualified medical expenses
 Dependent care expenses
▫ Funded by the employee’s pretax dollars
▫ “Use it or lose it” plan

9. Government Health Plans
• Medicare
• Medicaid
• Workers’ Compensation
• TRICARE
• CHAMPVA

10. Medicare
• Created by the Social Security Act in 1965
– Administered by the Centers for Medicare and
Medicaid Services (CMS)
• Who is covered?
– People over age 65 meeting eligibility
requirements and have filed for Medicare
– People who are disabled, receive Social Security
benefits, or are in end-stage renal disease

11. Medicare
• Part A
▫ Hospital coverage

12. Medicare
• Part B
– Other medical expenses, including office visits
• X-ray and laboratory services
• Initial Preventive Physical Exam
• Part C
– Enables beneficiaries to select a managed care
plan as their primary coverage
• Part D
– Coverage for generic and brand-name drugs

13. Medicare and Claims Processing
• Always keep up-to-date with Medicare
requirements
▫ Must use CMS-1500 form
▫ Must submit Medicare claims electronically
• Reimbursement to providers
▫ Medicare pays 80% of allowed amount after the
deductible is satisfied
▫ 20% is paid by patient, or supplemental insurance

14. Medical Necessity
• Medicare only reimburses services or supplies
deemed reasonable and necessary for the
diagnosis
• Advance Beneficiary Notices (ABN)
▫ If a provider performs a service not covered by
Medicare, an ABN is completed
▫ Must be signed by patient prior to procedure

15. Medicaid
• Health insurance for limited or low-income
individuals
– Must use participating provider
• Funded by both state and federal governments
– Eligibility requirements and benefits vary by state
– Medicaid cards are issued each month
– Always verify current coverage prior to visit

16. Workers’ Compensation
• State laws which cover employees who are
injured while working or as a result of work
• Benefits
– Medical treatment in or out of a hospital
– Temporary disability: may receive weekly cash
benefits in addition to medical care
– Permanent disability: weekly or monthly benefits,
or a lump sum settlement
– Payments to dependents for fatal injuries

17. TriCare
• Beneficiaries
▫ Active service personnel and their dependents
▫ Retired active service personnel and their
dependents
▫ Dependents of service personnel who died in
active duty

18. CHAMPVA:
Civilian Health and Medical Program of the Veterans’ Administration
• Beneficiaries
▫ Spouses and children of permanently disabled
veterans
▫ Spouses and children of veterans who died as a
result of service

19. Patients with No Insurance
• Classified as self-pay patients
• These patients are expected to pay at the time of
service

20. Primary and Secondary Insurance
• Patients may have more than one insurance plan
• Charges are filed first with the primary carrier,
and then secondary
▫ Coordination of benefits
• Dependent children and the Birthday rule

21. Primary and Secondary Insurance
• Medicare and supplemental insurance
▫ Many Medicare patients have supplemental or
Medigap insurance
▫ This covers the deductible and 20% coinsurance
• Medicare as secondary insurance
▫ When a person qualifies for Medicare but is still
employed

22. Verifying Insurance Coverage
• Always ask patients for current insurance card
• Make a copy of the card, or scan into the EMR
• Verify coverage online or over the phone

23. Utilization Review
• Preauthorization
• Precertification
• Predetermination
• Concurrent review
• Discharge planning

24. Fee Schedules
• Providers enrolled in an insurance carrier’s
network agrees to treat subscribers for an agreed
upon (discounted) rate for services
• Accepting assignment: when providers accept
the allowed amount as the rate for services
▫ Disallowed amounts are written off as
adjustments