Health insurance is provided by government-sponsored social insurance programs as well as private insurance companies. Health care provided by the government includes Medicare for the elderly or disabled, or Medicaid (also known as MediCal in California) for the disadvantaged, TRICARE (also known as CHAMPUS) for military dependents, and Medically Indigent Adult (MIA) programs for the indigent poor at the county level. In many communities there are private free clinics unaffiliated with any insurance company, plan, or government entity.
Public Health Insurance
The following are the different types of public health insurances:
Public Health Insurances
Medicare
Medicare is provided by the government. This is for people over 65 years old, disabled or in late stage of renal failure. Enrolled people must pay for deductibles and co-payments. There are 3 parts to Medicare. Part A pays for hospital bills. Part B pays for doctor bills. Part C allows you to choose from a package of health care plans. You should enroll as soon as you are eligible to obtain coverage for your health problems.
Medicaid
(Medical in California)
This is a state and federally funded program. This is for low-income people and families who have restricted resources. Medicaid gives payments directly to your health care provider.
State Children's Health Insurance Program
(SCHIP)
SCHIP is a state and federal program. This is for children with families that make too much money to be eligible for Medicaid, but too little money to obtain private health insurance.
COBRA
COBRA is a federal program. It provides the opportunity for workers to stay with their company health plans for up to 18 months after they leave the company. However, after the workers leave the company, they must pay for the premium themselves. This prevents any gap of coverage for workers in between jobs.
HIPAA
This is an Act of Congress that allows people to obtain insurance from any provider as long as they have been covered by a group policy in the last 63 days.
Private Health Insurance
There are 2 types of private health insurance: Traditional (Indemnity) Insurance and Managed Care.
Traditional or Indemnity Insurance
Based on a premium, you can choose any health care provider and receive reimbursement for the covered expenses. The following is a step-to-step guide of how it works.
You go to any doctor of your choice.
Submit a claim to your insurance company for reimbursement.
Your insurance company pays the covered expenses.
For most fee-for-service plans, before your insurance company begins to pay for medical costs, there is a deductible that you would need to pay from your own pocket every year. Many plans would also ask you to pay a part of the medical expense called “coinsurance”.
Managed Care
It contains health plans that have contracts with specified doctors, hospitals, and other members in order to offer services to plan members. The advantage is that your family doctor knows your medical history and can acknowledge any changes in your health. The following is a list of the different types of managed care plans.
Managed Care Plans
Health Maintenance Organizations
(HMOs)
This is a group of doctors, hospitals, and care providers that have agreed to offer a flat monthly rate without deductibles. Your HMO primary doctor would manage referrals. All visits, prescriptions and other services should be cleared with the HMO in order to be covered. Fees are paid in advance in form of a scheduled fee.
Preferred Provider Organizations
(PPOs)
The insurer has a set network of certain hospitals and physicians. Fees are paid as it is received. This policy allows you to see out-of-network professionals. However, you would have to pay for the deductible and a higher co-payment. You can visit the professionals within the network for lower fee. Your primary doctor within the network would manage referrals. For every visit, you need to file a claim so you can receive the reimbursement minus the co-payment.
Point of Service
(POS)
Your plan is managed by a Primary Care Physician (PCP). This is very similar to PPO.
Traditional Insurance (Fee-for-Service) vs. Managed Care
Traditional Insurance (Fee-for-Service)
Managed Care
Higher deductibles (usually $100 to $200) and co-payments.
Lower premium and deductibles.
More flexible. You can control your own care within the guidelines of your policy coverage. You can choose any health care professional you want.
Inflexible. The insurer may not approve some visits, medications, and treatments. there is a limited pool of heal care professionals.
