Health Insurance
Guides Notes
Health Insurance:
Questions To Ponder
• Why is Healthcare so expensive?
• Is Health Insurance Really Necessary for Everyone?
Think of examples where you or your family have needed medical
help/attention. Please provide stories/examples.
What is currently being done to improve healthcare in the United States?
Health Insurance Coverage
• Basic Coverage
• Physician Services When Not in Hospital
• Major Illnesses and Injuries
• Hospital Stays
• Surgical Procedures
Terms to Know:
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Hospitalization
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Room and board, routine nursing care, medical supplies used,
use of facilities (lab testing, X-rays)
Surgery
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Surgeon’s fee
Outpatient Services
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Doctor’s visit, procedures without hospitalization
Major Medical
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Extended stay, long-term therapy
Limits (500,000-2,000,000)
Additional Coverage Choices
1. __________________
2. Dental Care
3. ________ Care
4. What is Not Covered?
•
•
•
•
__________ _____________
Check-ups
__________________
Organ transplants
Health Insurance Plans
• All plans require premiums (usually monthly)
• The premiums vary based on the plan
• All plans cover medical, surgical, and hospital expenses
• Difference is in flexibility to choose providers
Health Care Costs
• 80/20 coverage: Amount covered by insurance/amount
covered by you
• ________________ is annual expense you have to pay before
insurance will cover the expenses
• __________________: pay a specific amount for services
regardless of the cost of those services
• Pay when you visit the doctor
Comparison of Health Care Plans
Continuum of Plans
Fee for Service or
Indemnity Plan
More Choice of
Providers
Higher Premiums
PPO
Preferred
Provider
POS
Point-ofService
HMO
Health
Maintenance
Organization
Less Choice of
Providers
Lower Premiums
The difference
PPO
HMO
• $$$$$
• More expensive
• More options
• $$
• Less expensive
• Less options
Group Health Plans
• Large groups such as employers, unions, and
professional organizations offer health insurance
to members
• As a benefit, many groups pay part (and sometimes all)
of the premium
• Premiums are lower through group plans as it is less
expensive to administer one plan to a large group
• Open enrollment is the period in which members
choose their health plan for the upcoming year
Health Insurance Issues
• ______________(Consolidated Omnibus Budget
Reconciliation Act) requires the employer to
extend your coverage for 18 months after you
leave your job but you have to pay the full
premium
• _______________________: medical condition
you have before joining a new insurance plan
• If you have continuous insurance coverage, preexisting conditions are covered by the new plan
• If there is a break in coverage, insurance might not
cover services for that condition for up to a 12 month
period – known as a WAITING PERIOD
Government Insurance
• ____________________: low-cost medical insurance for
older Americans (aged 65 or older) or have certain
disabilities
• You contribute to the plan through your paycheck
• Medigap insurance: private insurance you can buy to increase
your coverage with Medicare
• ____________________: health insurance for low
income (welfare) and disabled Americans regardless of
age
• Coverage varies by state as it is funded both by federal and state
programs
• _______________ _______________: states require
employers to pay for medical services if workers are
injured or die on the job
• Typically 2/3rds of your salary
Life Insurance
Why Buy?
• Protect you and your family from financial
hardship that could result from a death of a
family member
• Death of a wage earner
• Death of person who cares for children or family
records
• Funeral costs
• All create new costs for those living without the
deceased
• The main purpose is NOT to repay outstanding debts
• 75% of Americans own life insurance
Types of Insurance
• __________Life Insurance: pays a benefit if the death occurs
during a specific time (or term)
• ______________Life Insurance: pays a benefit when the
death occurs (policy does not expire) AND includes a savings
plan
• __________________: cash payments to help replace income
lost as a result of:
• Retirement, unemployment, disability, or death
Term Life Insurance
• Term Life Insurance: pays a benefit if the death occurs during a
specific time (or term)
•
•
•
•
If everyone remains living, benefit expires at the end of the term
Less expensive
Good choice for __________or ___________ people
Choice to insure while you are working
Permanent Life Insurance
• Permanent Life Insurance: pays a benefit when
the death occurs (policy does not expire) AND
includes a savings plan
• Also known as “cash value life insurance”
• Premiums pay for the death benefit and money
put away into savings (that earns dividends)
• Premiums are higher than term life
• You can withdraw amount in savings at any time
without penalty
How Much Life Insurance Should You Purchase?
• Depends on the following criteria:
• _____________ _______________
• _____________ _______________
• _______________
• _____________ ______________