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Health insurance involves taking an insurance plan to cover any medical expenses that one might incur over one’s lifetime. One is required to pay premiums to cover the health insurance plan. The amount and the frequency of the premium to be paid are determined by the insurance company with the agreement of the person taking the insurance cover (Frum, 2000). The health insurance is kind of a social or private contract between the person to pay the premiums and the insurance company to be paid. The person could be an individual person taking a private policy plan, an employer taking cover for his employee. An individual can also pay premiums to the federal government to get a health insurance cover over one’s lifetime.
Insurance policies in America are the most expensive when compared to other common wealth countries. This is according to a survey done by the commonwealth fund in 2007. The U.S health system is not only the most expensive, but it also under performs and does not have universal health cover.
Describe how risk can be managed.
Most Americans with a health insurance have a managed care plan that determines how one can access and receive health care as well as the amount one has to pocket whenever he/she receives care. The Managed health care plans on average covers an extensive range of health services. They include: Child and adult immunizations, general checkups, newborn care, preventive care, treatment of illness, diagnosis and complete prenatal. Moreover, most managed care plans give several services such as the diagnosis and treatment of mental health conditions as well as any substance abuse predicaments. Managed care plans works hard to save money by giving preventive health care services by early treatments and diagnosis to avoid one from serious health problems. When one contracts with hospitals and doctors in the community managed health plans they tend to save money to help control the fees they charge. These cost savings may help to suppress the much one and his employer pay every month for health insurance premium. The group of contracted health care giver is identified as the health plan’s “network.” When one receives health care services from a contracted network provider it is cheaper than to those who receive care from providers that are not part of the network provider (Morone, 2010).
Managed Care Out-of-Pocket Costs
One has to pay at an annual deductable as well as a copayment every time he visits the doctor. The sum of copayments and deductable depends on the premium. For instance a plan that requires one to use a network provider has high deductable and the copayment will have low premiums and vice versa.
Managed Care and Prescription Medications
This includes the formulary that one’s health plan has to pay for the medication. One’s copayment depends on the medicine one gets for instance: can get a generic or any other brand named medication that is not preferred by the health plan. Moreover One’s health plan might have lower copayments for prescription medications that you obtain through having a mail order fairly than through a ordinary retail pharmacy. There are three types of managed care plans that use provider network and are offered all through the country by health insurance companies. They include:
Health Maintenance Organizations that provides a network primary care physician responsible for coordinating and managing ones health Incase one needs a diagnostic service he/she maybe given a referral.
Preferred Provider Organizations is a health plan that has contracts with a network of preferred providers for one to choose. Here no referrals are required. When one receives care from doctors in the preferred network then he is responsible for only the annual deductable and a copayment for one’s visit. When one gets care from a doctor outside the preferred network one will pay higher amount like coinsurance
Point-of-Service Plans are a combination of a health maintenance organization and a preferred provider organization. Normally, POS plans have got a network which plays a role like a HMO. Here one picks a primary care doctor that coordinates and manages his care within the network. POS plans permits one to use a provider that is not within the network. However, when one chooses to go out-of-network for his care, he pays more. The POS are most preferred since one may decide to stay in the network and allow the PCP to control his care.
Evaluate the risks of health insurance in society (Morone, 2010).
In the U.S there are both private and social health coverage policies. The social insurance policies include the Medicare, Medicaid and other government social programs that provide health care to poor people unable to meet the costs of private health insurance premiums. It is important to note at this point that about 57 – 59% of all Americans rely on private health insurance covers. This is among the reason why the U.S health system was considered as the most expensive among the common wealth nations. Due to the high cost of private health insurance cover, a significant part of the population goes without cover annually in America. It is estimated that about 46 million people did not have any health insurance cover in 2007. It is highly risky for one to lose one’s job as with the loss one also loses the source of money to pay health insurance premiums which in most cases are paid by the employer.
The result of this is that it was affordable for higher number of individuals to access some form of medical care (Mullan, 2002). Accordingly, many individuals have the capability of having access to healthcare either through the government-funded system or through private one. A large number of citizens are under the coverage of employer-funded scheme. Hence, the implication of private healthcare is an increase access. In addition, the blues had the mandate of ensuring that there is coverage of populations from all the corners of the country. Insurance means that it becomes affordable to seek medical services increasing the frequency of hospital attendance.
Private insurance schemes have led to escalation in the price of coverage. With increasing coverage throughout the country, the result has been an increase in the prices of healthcare. Reports indicate that growing insurance covers throughout the country lead to spiraling healthcare costs. An example is the period between 1950 and 1970, during this period country’s expenditure on healthcare rose by 586%, which was more than the entire gross national product of the United States that grew by 347% (Mullan, 2002). Hence, the cost of medical services did increase significantly due to the increasing medical cover. Currently, there is a general opinion among the public that the government has to intervene in order to protect the normal citizens from the skyrocketing healthcare prices. Generally, the effects on the cost of healthcare with the introduction of the private healthcare are it scaling upwards, which is a growing concern among the general population.
Insurers have limited options to contain the increasing cost. Healthcare cost is a direct responsibility of the healthcare centers and their physicians. With the government seeking to intervene into the healthcare system, there will probably be a reduction in healthcare inflation. Such escalating cost forced employers to increase the reductions of their employees to meet the costs. Blue Shield and Blue Cross have little effect on the providers since they only deal with the insured individuals (Schuetz, 2010). Cost escalation has large attribution to the increase in demand of the services due to the employer-based insurance. More people could now afford to receive treatment and following the demand supply curve, the prices were bound to increase with increase in demand with a reflection of the same on the supply.
When the health insurance was starting, the impression was that it would eradicate cost barriers to medical .............
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