Reinsurance
Reinsurance refers to the actions of insurers transferring part of their risk portfolio to other insurance agencies in order to minimize their risks to pay large obligations resulting from insurance claims.
Flexible spending accounts (FSAs)
Flexible Spending Accounts refers to the special account that individuals put money meant to be used for given out-of-pocket health care needs. The money saved in the FSAs is not taxable.
Prospective Reimbursement
Prospective reimbursement refers to as system of annual reimbursement under which healthcare providers are paid based on the previously established rates.
Diagnosis-related group (DRG)
Diagnosis-Related Group is a statistical system that classifies all inpatient stay into certain groups for purposes of payment. The system divides the possible diagnosis into major bodies systems and further subdivides them into several other groups for purposes of Medicare reimbursement.
Resource Utilization Group (RUG)
Resource Utilization Groups flow from minimum data set and drive Medicare reimbursement to the nursing homes under the confines of Prospective Payment System. Residents are initially assigned to one of the seven main categories based on their functional abilities and clinical characteristics.
Coinsurance
Coinsurance is a situation where an individual`s share of covered health care service is calculated as a percentage of an allowed service amount. Coinsurance is paid after an individual meets their deductible amount.
Consumer-driven Health plans
Consumer-driven healthcare refers to the third tier health insurance plan that allow an individual to use health savings account, health reimbursement account or any other medical payment product to pay for the routine healthcare needs, while high-deductible health plans protect the individuals from any catastrophic medical expenses.
Cost sharing
Costs Sharing refers to the share of medical costs covered by an insurance that an individual pays out of their pocket. It includes copayments, deductibles and other similar charges but it does not include costs of non-covered services, non-network providers and premiums.
Entitlement program
Entitlement program refers to government initiatives that guarantee access to some benefits by members of a given group based on established legislation or rights. The programs are based on the concept of principle which relies on enfranchisement and social equality.
Different parts of Medicare
Medicare refers to the federal health insurance program for the people aged more than 65 years, people with End-Stage Renal Disease and certain younger people with disabilities.
Medicare Part A (Hospital Insurance) covers inpatient stays, hospice care, some home care and skilled nursing facility.
Medicare part B (Medical Insurance) covers certain outpatient services, doctors` services, preventive services and medical supplies. Medicare part C ( Medicare Advantage Plans) refers to the type of Medicare health plan that is offered by privately contracted companies to provide a person with Part A and Part B benefits. The plan includes Preferred Provider Organizations, Health Maintenance Organizations, Special Needs Plans, Medicare Medical Savings Account plans and Private Fee-for-Service plans. Majority of the services provided under this part are covered through the plan and are not paid for under the Original Medicare.
Medicare Part D (Prescription drug coverage) incorporates prescription drug coverage to the Original Medicare, Medicare Medical Savings Account plans, some Medicare Private-Fee-for-Service Plans and some Medicare Cost Plans. The plans are offered by some private and insurance companies approved by Medicare.
Cost sharing in the US healthcare system
Costs Sharing refers to the share of medical costs covered by an insurance that an individual pays out of their pocket. It includes copayments, deductibles and other similar charges but it does not include costs of non-covered services, non-network providers and premiums. The success of cost sharing between employees and employers is pegged on the ability of the patients to make informed decision concerning their health care purchases.
Managed Care
A managed Care plan refers to the type of insurance that have contracts with the medical facilities and health care provides to give care to the members at low costs.
Health maintenance organizations
Health Maintenance Organization plans provide a variety of healthcare services through a health care service provider’s network that agree to provide services to the members. An HMO improves coverage for a wide range of preventive healthcare service.
Preferred provider organizations
Preferred provider organizations refers to a managed care organization of hospitals, medical doctors in addition to other health care providers who agree with insurers to provide health care services at minimal rates to the insurer`s clients.
Medicare Deemed Status
The CMS allows some health care agencies and organizations that participate in Medicaid and Medicare programs to qualify for exemptions from the federal requirements through obtained a deemed status. The deemed status can be obtained by a health care organization if they have been granted accreditation through any national accrediting agency.
Point-of-service plans
Point-of-service plan contains the qualities of PPO and HMO plans with benefits varying depending on whether an individual obtains their care in or out of a health insurance company`s network of health care providers.
Indemnity plan
Indemnity plans provides an individual with the ability to direct their own health care and visit any hospital or doctor they like. They are also referred to as fee-for-service plans. The insurance companies pay a portion of a person`s initial charges.
Carve outs
Carve outs refers to the medical services that are separate from the contract and are paid under different arrangements.
Fee-for-service plans
Fee-for-service refers to a type of insurance under which the health care plan will either reimburse you or pay the medical provider directly after an individual files an insurance claim for the covered medical expenses.
Medical loss ratio
Medical Loss ratio refers to the percent of premiums insurers spend on expenses and claims aimed at improving the health care quality.
Silent PPOs
Silent preferred provider organizations refers to the entities that sells or takes access to health care
The characteristic of Fee-for-service, HMO, PPO and POS healthcare plans and the differences between the HMO and PPO plans.
Fee-for-service plans
Fee-for-service refers to a type of insurance under which the health care plan will either reimburse you or pay the medical provider directly after an individual files an insurance claim for the covered medical expenses.
Health Maintenance Organization
Health Maintenance Organization delivers health care services through a certain network of facilities and healthcare providers. It provides freedom to choose health care providers, contains minimal paper work, and require referrals before seeing a specialist.
Preferred provider organizations
Preferred provider organizations refers to a managed care organization of hospitals, medical doctors in addition to other health care providers who agree with insurers to provide health care services at minimal rates to the insurer`s clients. They give the clients a considerable amount of freedom to choose the healthcare providers, have high out-of-pocket costs and contain more paperwork.
Point-of-Service Plan
It incorporates the features of HMO and PPO plans. It has more freedom to choose the healthcare providers, moderate paperwork and primary care doctor.
Differences
HMO differs from PPO since they contract with health care professional and other facilities to create a providers network and whenever an individual pays for HMO insurance, a small co-payment is made if you visit any hospital or physician within the plan network. It features low premiums and co-pays as compared to other plans. In contrast, the PPO makes contractual agreement with health care service providers and creates a providers network. Unlike the HMOs, the PPOs health insurance covers some of the costs of care administered by other out-of-network providers. If PPO plan is selected, an individual will encounter low co-payments provided that you they see in-network physicians. In addition, it is advantageous because there is no need for a primary care physician`s authorization to see a specialist who is within the network.
Medical loss ratios and why it could decrease the cost sharing of your health insurance coverage.
Loss ratios have been used as a measure by a variety of users for various reasons. They are commonly used to evaluate an organization`s performance and provide individuals on the quality of health care competing plans and testing products against loss. The medical loss ratio refers to the total losses paid out plus any expenses divided by the earned premiums. The ratio is significant in defining the costs that an individual is supposed to pay and if the ratio is low, then the costs of the insurance coverage is likely to be low.
