The two main health insurances are private (non-government) coverage and government-sponsored coverage. The private coverage is provided by either an employer, union or individually purchased from a private health insurance company. Government-sponsored insurance plans are those that are funded by the federal government, state government or local government. The major categories are Medicare, the Children’s Health Insurance Program (CHIP), Medicaid and military health care (Center for Medicare and Medicaid Services, 2014).
Medicare insurance is provided by the federal government and helps to pay the health care costs for the people who are 65 years or older who worked and paid into the system. It also provides insurance for those below 65 years but with long-term disabilities (Center for Medicare and Medicaid Services, 2014). For those enrolled in Medicare insurance, it covers 48 percent of the health care charges with the rest paid by the person insured either with out-of-pocket coverage or with a supplemental insurance (USA.gov., 2015).
Medicaid is an insurance program which is administered at the state level and aims at providing the needy with medical assistance. Those eligible include the aged, the blind, the disabled and families with dependent children. The recipients of Medicaid must be citizens of the United States of America or legal permanent residents (Center for Medicare and Medicaid Services, 2014). Children’s Health Insurance Program provides health insurance to families with children. It covers families with incomes that are too low to qualify for Medicaid. It is provided at the state-level and was formerly known as the State Children’s Health Insurance Program (SCHIP). The military health care includes:(i) TRICARE which provides health care insurance for the active and retired members of the military, their families and survivors, (ii) CHAMPUS (Civilian Health and Medical Program of the Uniformed Services) which helps veterans, veteran’s dependents and survivors of veterans to pay for the cost of medical services, and (iii) The Department of Veterans Affairs which gives the eligible veterans of the armed forces medical support (Center for Medicare and Medicaid Services, 2014).
Physicians can be paid using private insurers and by government (i.e. Medicare and Medicaid) programs. This is known as ‘fee-for-service’ in which the health care payer pays whatever the physician charges without any prearrangement of fees once the care provider submits an insurance claim. Another method of payment is Capitation in which the physician receives a certain flat fee every month for the enrolled individual. This takes care of the person’s health care plan regardless of the cost for the individual. Capitation motivates the provider to keep the members healthy through good primary care and preventive care so as to reduce the number of sick people who are enrolled (USA.gov., 2015).
The insurance companies use Usual, Customary and Reasonable (UCR) rates to determine the medical bill that the insurance plan covers. These are used in Medicare billing to avoid unexpected expenses especially when a patient receives care from a provider who is outside the insurance network (USA.gov., 2015). The state or federal agencies do not regulate UCR charges but providers who participate with Medicare accept allowable charge as full payment. Since Medicare is an 80/20 plan, the patient pays for the 20 percent allowable charges paid by Medicare. Reading and understanding the health care plan provided by an insurance company therefor helps someone and provides vital information about the health care services (Center for Medicare and Medicaid Services, 2014).
Center for Medicare and Medicaid Services. "Self-Funded, Non-Federal Governmental Plans - Centers for Medicare & Medicaid Services." N.p., 2014. Web. <https://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-Insurance-Market-Reforms/nonfedgovplans.html>.
USA.gov. "Health Insurance | USA.gov." N.p., 2015. Web. <https://www.usa.gov/health-insurance>.