Employer-sponsored health insurance is paid for by businesses on behalf of their employees as part of an employee benefit package. Most private (non-government) health coverage in the US is employment-based. Nearly all large employers in America offer group health insurance to their employees. The typical large-employer PPO plan is typically more generous than either Medicare or the Federal Employees Health Benefits Program Standard Option.
Health insurance can be tricky to navigate. Managed care insurance plans require policyholders to receive care from a network of designated health care providers for the highest level of coverage. If patients seek care outside the network, they must pay a higher percentage of the cost. In some cases, the insurance company may even refuse payment outright for services obtained out of network. Many managed care plans require patients to choose a primary care physician who oversees the patient's care and makes recommendations about treatment. Insurance companies may also deny coverage for services that were obtained without preauthorization. In addition, insurers may refuse payment for name-brand drugs if a generic version or comparable medication is available at a lower cost.
According to a 2000 Congressional Budget Office (CBO) report, Congress passed legislation creating "two new vehicles Association Health Plans (AHPs) and HealthMarts, to facilitate the sale of health insurance coverage to employees of small firms" in response to concerns about the "large and growing number of uninsured people in the United States."
The United States health care system relies heavily on private health insurance, which is the primary source of coverage for most Americans. As of 2012 about 61% of Americans had private health insurance according to the Centers for Disease Control and Prevention. The Agency for Healthcare Research and Quality (AHRQ) found that in 2011, private insurance was billed for 12.2 million U.S. inpatient hospital stays and incurred approximately $112.5 billion in aggregate inpatient hospital costs (29% of the total national aggregate costs). Public programs provide the primary source of coverage for most senior citizens and for low-income children and families who meet certain eligibility requirements. The primary public programs are Medicare, a federal social insurance program for seniors and certain disabled individuals; and Medicaid, funded jointly by the federal government and states but administered at the state level, which covers certain very low income children and their families. Together, Medicare and Medicaid accounted for approximately 63 percent of the national inpatient hospital costs in 2011. SCHIP is a federal-state partnership that serves certain children and families who do not qualify for Medicaid but who cannot afford private coverage. Other public programs include military health benefits provided through TRICARE and the Veterans Health Administration and benefits provided through the Indian Health Service. Some states have additional programs for low-income individuals.
Erica Block is an Editorial Fellow at HealthCare.com, where she gets to combine her interest in healthcare policy with her penchant for creating online content. When she isn't reading or writing, Erica can be found wandering around Brooklyn, playing softball, or listening to podcasts. She counts music, rescue dogs, and lumberjack sports among her greatest passions. Follow Erica on Twitter: @EricaDaleBlock
In 1935 the decision was made by the Roosevelt Administration not to include a large-scale health insurance program as part of the new Social Security program. The problem was not an attack by any organized opposition, such as the opposition from the American Medical Association that derailed Truman's proposals in 1949. Instead, there was a lack of active popular, congressional, or interest group support. Roosevelt's strategy was to wait for a demand and a program to materialize, and then if he thought it popular enough to throw his support behind it. His Committee on Economic Security (CES) deliberately limited the health segment of Social Security to the expansion of medical care and facilities. It considered unemployment insurance to be the major priority. Roosevelt assured the medical community that medicine would be kept out of politics. Jaap Kooijman says he succeeded in "pacifying the opponents without discouraging the reformers." The right moment never came for him to reintroduce the topic.
Another distinction between plans that can change the rates you pay, is the type of network the plan uses. Depending on whether the plan is a PPO, HMO, EPO or POS plan, consumers will have access to the health care providers managed in different ways. HMOs tend to be the most restrictive about which doctors you can see and what you must do to see them. This usually means that the insurers save on your cost of care and thereby provide lower premiums.
The Affordable Care Act of 2010 was designed primarily to extend health coverage to those without it by expanding Medicaid, creating financial incentives for employers to offer coverage, and requiring those without employer or public coverage to purchase insurance in newly created health insurance exchanges. This requirement for almost all individuals to maintain health insurance is often referred to as the "individual mandate." The CBO has estimated that roughly 33 million who would have otherwise been uninsured will receive coverage because of the act by 2022.
3) The insurance company will then review your application and you can receive an update within 24 hours on whether you are approved; though in some cases you may receive a status update or request for further information instead. Depending on whether the insurance company needs more information, when you submit your application or other conditions, some exceptions may apply.
Health insurance is a type of insurance coverage that pays for medical and surgical expenses incurred by the insured. Health insurance can reimburse the insured for expenses incurred from illness or injury, or pay the care provider directly. It is often included in employer benefit packages as a means of enticing quality employees. The cost of health insurance premiums is deductible to the payer, and the benefits received are tax-free.
Workers who receive employer-sponsored health insurance tend to be paid less in cash wages than they would be without the benefit, because of the cost of insurance premiums to the employer and the value of the benefit to the worker. The value to workers is generally greater than the wage reduction because of economies of scale, a reduction in adverse selection pressures on the insurance pool (premiums are lower when all employees participate rather than just the sickest), and reduced income taxes. Disadvantages to workers include disruptions related to changing jobs, the regressive tax effect (high-income workers benefit far more from the tax exemption for premiums than low-income workers), and increased spending on healthcare.
Deductible: The amount that the insured must pay out-of-pocket before the health insurer pays its share. For example, policy-holders might have to pay a $500 deductible per year, before any of their health care is covered by the health insurer. It may take several doctor's visits or prescription refills before the insured person reaches the deductible and the insurance company starts to pay for care. Furthermore, most policies do not apply co-pays for doctor's visits or prescriptions against your deductible.
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A number of alternatives to the public option were proposed in the Senate. Instead of creating a network of statewide public plans, Senator Olympia Snowe proposed a "trigger" in which a plan would be put into place at some point in the future in states that do not have more than a certain number of private insurance competitors. Senator Tom Carper has proposed an "opt-in" system in which state governments choose for themselves whether or not to institute a public plan. Senator Chuck Schumer has proposed an "opt-out" system in which state governments would initially be part of the network but could choose to avoid offering a public plan.