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Insurance 101

SEMINAL STUDY

8.2

8.1 // Access to Healthcare & Insurance

8.3 // Impact of Insurance on EM

8 ACCESS TO HEALTHCARE & INSURANCE

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Conflicts of Interest/Disclosures

We have no conflicts of interest

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Objectives

Explore the different types of insurance available in the United States
Define common terms used in insurance
Explore the requirements for different forms of health insurance
Discuss options available for healthcare outside of health insurance
Discuss factors that impact ability to have and maintain insurance and access healthcare

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Case vignette: Jean

63 year old African American woman with no significant past medical history who twisted her right ankle after she slipped walking down the stairs at home

She presents for right ankle swelling with a deformity and imaging reveals a pilon fracture that will require extensive surgery and rehabilitation

She unfortunately does not have insurance as she was previously covered by her partner who recently lost their job

She is unsure of how she is going to afford her medical care

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Jean is a 63 year old woman who walked down the front steps of the house she had purchased a decade before when her ankle clumsily slipped to the side. Just like that she developed a complex fracture that would require extensive surgery and rehabilitation. She currently works two part-time jobs and had insurance coverage under her partner but they recently lost their job and therefore their coverage. At this point, she was unsure of how she is going to pay for the medical care she requires to return to her normal level of functioning. To complicate matters, she is unable to go to her job as a certified nursing attendant because she cannot walk.

Previous version: In her early sixties and believing she was in perfect health, she like many others in the midst of rising costs of rapid inflation had faced the decision of how to minimize her expenses. One of her cost cutting measures was to cancel her employer provided health insurance, and the timing could not have been worse—two weeks before her fall.

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Discussion Questions

What options do people without health insurance have for accessing care?

How would this scenario change if Jean was 65? What about if she was pregnant and 27?

What percent of their income do you think uninsured individuals below the poverty line pay in out-of-pocket medical expenses?

What type of household debt is the highest sent to collection agencies? What percent of collection debts do you estimate is due to this household debt?

What options do people without health insurance have for accessing care?

Patients without insurance can in theory go to any type of doctor. However, the greatest barrier will be cost and if the office will actually accept patients without insurance. The most affordable options may be Community Health Clinics or Free Clinics. Other options include Payment plans can be arranged, Discounts may be available (eg sliding scale payments based upon income or free clinics). Due to EMTALA, the way to ensure that care will occur is going to the emergency department. Of note, the uninsured skew disproportionately towards those of lower socioeconomic status. Yet due to their lack of leverage to negotiate prices (like health insurance companies), they are charged the highest prices.

What percent of income do you think uninsured individuals below the poverty line pay in out of pocket medical expenses?

For Medicare enrollees, out-of-pocket medical expenses consume 11·2% of income among those with incomes above 300% of the poverty level, and between 22·7% and 26·8% among those with incomes below 200% of the poverty level.

What type of household debt is the highest sent to collection agencies? What percent of collection debts do you estimate is due to this household debt?

Medical debts, 52.1%
( See figure 5 in Inequality and Health-care system in the USA)

Dickman, S. L., Himmelstein, D. U., & Woolhandler, S. (2017). Inequality and the health-care system in the USA. The Lancet, 389(10077), 1431–1441. https://doi.org/10.1016/s0140-6736(17)30398-7

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What is health insurance? Premiums? Deductibles? Copayments? Coinsurance? From our friends at Healthcare.gov

Health Insurance: A contract that requires your health insurer to pay some or all of your health care costs in exchange for a premium.

Premium: The amount you pay for your health insurance every month. In addition to your premium, you usually have to pay other costs for your health care, including a deductible, copayments, and coinsurance

Deductibles: The amount you pay for covered health care services before your insurance plan starts to pay. With a $2,000 deductible, for example, you pay the first $2,000 of covered services yourself.

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What is health insurance? Premiums? Deductibles? Copayments? Coinsurance? From our friends at Healthcare.gov

Copayment: A fixed amount ($20, for example) you pay for a covered health care service after you've paid your deductible.

Coinsurance:The percentage of costs of a covered health care service you pay (20%, for example) after you've paid your deductible.

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How are people insured in the U.S. vs “Industrialized” nations elsewhere?

United States

Elsewhere

Single payer System
Employment-Based System
Managed Competition

Of note, these types of insurance in the US are almost all funded through private insurance companies. The US has a hybrid model of the 3 mentioned systems used abroad. Additionally health insurance can also be further delineated into types of insurance plans: HMO (health maintenance organizations), PPO (preferred provider organizations), EPO (exclusive provider organizations), POS (point of service), HDHP (High deductible health plans). All of which have varied premium and deductible variations with different abilities to choose providers in or outside a network.

Single Payer System: a healthcare model in which the government pays for the healthcare of all of its citizens (Tanner 2008). The government’s role is to collect taxes from the citizens, which ultimately covers the cost of the system; to pay healthcare providers; and to administer the supply of healthcare (Tanner 2008). The government generally determines a budget of healthcare expenses for the year, and reimbursement rates and prices are subsequently based upon that budget. Medicare/Medicaid are most similar to this model in the US. Countries that use this model: Great Britain, Canada, Brazil

Employment Based System: mandates that employers must provide workers with health insurance provided through a private fund. The funds are determined across industry sectors, and the government determines the premiums and benefits. The premiums usually come from the payroll tax in the system. The providers are separate from the funds and negotiate prices with these funds for reimbursement (Tanner 2008). Employer subsidized insurance in the US is similar to this model.

Countries that use this model: Germany, France

Managed Competition: The private insurers in this system exist within a fabricated marketplace, which is strictly regulated by the government (Tanner 2008). In most managed competition national healthcare systems, it is mandatory that individuals buy insurance, but it can also be required that employers provide insurance to their employees (Tanner 2008). This is essentially the model of the original Affordable Care Act prior to legislation during the Trump administration that dismantled the mandatory aspects.

Countries that use this model: Switzerland and Netherlands

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Medicare Eligibility

Medicare

U.S. Citizen and

> 65 or older or
Social Security Disability or
ESRD or ALS

Medicare eligibility calculator

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Medicaid Eligibility

Affordable Care Act - 2010

Varies from state to state
Federal law requires states to cover certain groups of individuals

Low-income families
Qualified pregnant women and children
Individuals receiving Supplemental Security Income (Full list: Medicaid Eligible)

Created the opportunity for states to expand Medicaid to coverage
Eligibility for children was extended to at least 133% of the federal poverty level (FPL) in every state (most states cover children to higher income levels)
States were given the option to extend eligibility to adults with income at or below 133% of the FPL.

As of February 2023, 40 states and DC have adopted this expansion

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Parts of Medicare- the alphabet soup

2 Steps to sign up

Must sign up for Medicare Part A and Medicare Part B
Decide on original Medicare or Medicare Advantage (Part C) for your health coverage.

If you choose Original Medicare, you’ll also decide if you want drug coverage (Part D) and/or supplemental coverage

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Medicare: The Fine Print

Original Medicare covers most, but not all of the costs for approved health care services and supplies. Once the deductible is met, you pay your share of costs for services and supplies as you get them. There’s no out-of pocket maximum unless you have other coverage (like Medigap, Medicaid, or employee or union coverage).

Medicare Advantage bundles your Part A, Part B, and usually Part D coverage into one plan. Plans may offer some extra benefits that Original Medicare doesn’t cover — like vision, hearing, and dental services. You join a plan offered by Medicare-approved private companies that follow rules set by Medicare. There can be premiums associated with this plan.

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Private Insurance Providers can be accessed through different types of insurance, so what’s the difference?

Employer subsidized insurance: The employer shares the cost with the employee to pay the premium. There is usually a cost-saving for the employee in this model.

Individual market: If not provided with employer provided insurance for certain income levels, the insured can receive tax credits and lower premium prices due to the affordable care act

Medicare: additional medical cost coverage provided by private insurer that still requires a premium.

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Who are people without health insurance?

Prior to ACA being enacted in 2010, 46.5 million Americans did not have health insurance

As of 2021, 27.5 million Americans remain uninsured -> most have annual incomes near or below the federal poverty level ($15,060 for an individual in 2023).

Undocumented individuals are generally not eligible for federal health coverage with certain exceptions*

Some undocumented people do have access to Medicaid – for example emergency Medicaid to cover hospital admissions, and some are able to get organ transplants

Another large group who may not have insurance may be people in their late 20s (starting around age 26) who can no longer be covered under their parents insurance. COBRA insurance might be an option in these cases.

Excerpt from the Department of Labor website (https://www.dol.gov/general/topic/health-plans/cobra): “The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events. Qualified individuals may be required to pay the entire premium for coverage up to 102% of the cost to the plan.

COBRA generally requires that group health plans sponsored by employers with 20 or more employees in the prior year offer employees and their families the opportunity for a temporary extension of health coverage (called continuation coverage) in certain instances where coverage under the plan would otherwise end.”

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Proportion of uninsured people by state (as of 2022)

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What options do people without health insurance have?

Hospital Assistance Programs

Sliding Scale Payment Structures

Free Clinics

Paying full price out of pocket

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Important Health insurance trends

High deductibles

The proportion of covered individuals with a deductible over $1000 (for individuals) increased from 17% in 2009 to 50% in 2022

Higher premiums

Annual family premiums average $22,463 in 2022, with workers contributing $6,106 of the total

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Outcomes linked to a lack of health insurance

The uninsured are far more likely than the insured to forgo needed medical visits, tests, treatments, and medications because of costs, resulting in delayed presentation and worse outcomes

19% of non-elderly adults in the USA who received prescriptions in 2014 (after full implementation of the Affordable Care Act [ACA]) could not afford to fill them

10-15 year difference in life expectancy between the wealthiest and the poorest in the US

Economic ramifications of paying higher costs: bankruptcy

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Current hot topics

Continuous eligibility

Public Health Emergencies

Value based care

Social determinants of health

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References

Armbrecht, K. (2021, November 19). Medicare eligibility. Medicare On Video. Retrieved February 3, 2023, from https://medicareonvideo.com/medicare-explained/medicare-eligibility/

Caldwell, M. (2022, March 25). How to pay your medical bills with no health insurance. The Balance. Retrieved February 3, 2023, from https://www.thebalancemoney.com/paying-medical-bills-with-no-health-insurance-2385907

Claxton G, et al. Health Benefits In 2022: Premiums Remain Steady, Many Employers Report Limited Provider Networks For Behavioral Health. Health Affairs 2022 41:11, 1670-1680

Dickman, S. L., Himmelstein, D. U., & Woolhandler, S. (2017). Inequality and the health-care system in the USA. The Lancet, 389(10077), 1431–1441. https://doi.org/10.1016/s0140-6736(17)30398-7

Gish, T. (2022, April 12). 25 best private health insurance companies in the world. Loving Homecare Inc. Retrieved February 3, 2023, from https://lovinghomecareinc.com/private-health-insurance-companies

Glossary. HealthCare.gov. (n.d.). Retrieved February 3, 2023, from https://www.healthcare.gov/glossary/

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References

Lindley K, Aggarwal N, Briller J, et al. Socioeconomic Determinants of Health and Cardiovascular Outcomes in Women. J Am Coll Cardiol. 2021 Nov, 78 (19) 1919–1929.

Parts of Medicare. Medicare. (n.d.). Retrieved February 3, 2023, from https://www.medicare.gov/basics/get-started-with-medicare/medicare-basics/parts-of-medicare

Published: Oct 08, 2020. (2020, October 7). Average family premiums rose 4% to $21,342 in 2020, benchmark KFF employer health benefit survey finds. KFF. Retrieved February 3, 2023, from https://www.kff.org/health-costs/press-release/average-family-premiums-rose-4-to-21342-in-2020-benchmark-kff-employer-health-benefit-survey-finds/

RevCycleIntelligence. (2023, January 4). What is value-based care, what it means for providers? RevCycleIntelligence. Retrieved February 3, 2023, from https://revcycleintelligence.com/features/what-is-value-based-care-what-it-means-for-providers

Tanner, M. (2008). The grass is not always greener: A look at National Health Care Systems around the world. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.1262978

Volz, M. (2022, December 8). More states to consider extending postpartum Medicaid coverage beyond two months. Kaiser Health News. Retrieved February 3, 2023, from https://khn.org/news/article/states-consider-postpartum-medicaid-extension-months/

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SEMINAL STUDY

Impact of Insurance on Em

8.3

9.1 // Stimulant Use Disorder & SPEC. POPULATIONS

9.2 // ALCOHOL & BENZODIAZEPINE USE DISORDERS

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