Lesson Objectives:

• identify key terms related to health insurance

• identify the types of health insurance available in the United States

• explain the changes in U.S. health insurance as a result of the Affordable Care Act

• list the benefits of health insurance in the United States

health insurance - type of insurance that covers unexpected medical costs that can occur due to a disease or injury.

Medicaid - not a social insurance program but a social welfare or social protection program. It was instituted to cover treatment costs for people with limited income and/or resources.

Medicare - government national health insurance program that began in 1965 under the Social Security Administration (SSA).

premium - a specific sum of money over a fixed period, usually monthly or each time a person receives a paycheck.

single-payer healthcare - a type of universal healthcare in which a government system uses funding generated from tax revenue to cover essential healthcare costs for all residents.

Affordable Care Act (ACA) – a reform to health insurance in the United States.

claim - a formal request or submission for the coverage of a visit, treatment, or procedure that is allowed by the person's insurance policy.

coinsurance - fixed percentage of a bill generated during a medical treatment that has to be paid by the insured (the person who has the insurance), or the patient.

co-pay - is the proportion of your health insurance claim that you are responsible for paying out of pocket for an in-network expense, with the understanding that the insurance plan will pick up the rest of the cost.

deductible - a fixed amount paid by a patient annually before the initiation of their health insurance to cover the costs.

Lesson Vocabulary:

Health Insurance

A type of insurance that covers unexpected medical costs that can occur due to disease, illness, or injury

Single-payer Healthcare- a type of universal healthcare in which a government system uses funding generated from tax revenue to cover the essential healthcare costs for all residents

Key Terms Used in Health Insurance:

1. Premium

2. Out-of-pocket

3. Deductible

4. Co-pay

5. Coinsurance

6. Claim

• An out-of-pocket maximum is a cap, or limit, on the amount of money a person has to pay for covered healthcare services in a plan year.

• Once this amount is met, the plan covers 100% of healthcare costs for the rest of the year.

Out-of-Pocket

• A specific sum of money over a fixed period, usually monthly or each time a person receives a paycheck.

• A set amount to cover the cost of the overall health insurance policy.

• Usually, an employer pays a portion, and the employee pays a portion of the premium

Premium

Key Terms Used in Health Insurance

• Copayment is the portion of your visit that you are responsible for paying out of pocket, with the understanding that the insurance plan will pick up the rest of the cost.

• It can be a fixed amount (usually) or a percentage.

Co-Pay

• A fixed amount paid by a patient annually before their healthcare will cover the costs.

• Usually a fixed sum.

Deductible

Key Terms Used in Health Insurance

• A formal request or submission for the coverage of medical treatment.

• This is typically done by the healthcare provider and sent to the insurance company for payment.

Claim

• A fixed percentage of a bill generated during a medical treatment that is the responsibility of the patient.

• The insurance will pay the rest after the coinsurance is paid.

Coinsurance

Key Terms Used in Health Insurance

​Types of Health Insurance

A government health insurance program that began in 1965 under the Social Security Administration (SSA).

It offers health insurance to those who are over 65 and/or individuals with disabilities or specific medical conditions.

Medicare

A social welfare or social protection program.

It covers treatment costs for people with limited income and/or resources.

Medicaid

​A program regulated by US Dept of Health and Human Services.
Provides health insurance to children in families who have more income than needed to be eligible for Medicaid, yet cannot afford to buy private health insurance

CHIP

A program of the US Dept of Defense.

Provides civilian health benefits for military personnel, military retirees, and dependents.

Tricare

​Types of Public Health Insurance

​Types of Private Health Insurance

Common Structures of Private Health Insurance Plans

1. Health Maintenance Organizations (HMO)

2. Point of Service (POS)

3. Exclusive Provider Organization (EPO)

4. Preferred Provider Organization (PPO)

Health Maintenance Organization (HMO)

• Provide or arrange medical care for health insurance

• Contracts with a network of healthcare providers who agree to set rates for services.

• Members are required to choose a Primary Care Physician (PCP) who coordinates care and provides referrals to specialists

• Tend to have lower premiums and out-of-pocket costs, but have limited choice of providers and require referrals to see specialists; out-of-network care may not be covered at all.

Point of Service (POS)

• Combines features of an HMO and a PPO, offering a balance between cost and flexibility

• Requires you to choose a PCP who manages your care and provides referrals to specialists

• But, allows you to see out-of-network providers, though usually at a higher cost

Exclusive Provider Organization (EPO)

• Requires members to use healthcare providers within the plan's network of coverage with limited exceptions for emergencies

• They typically do not require referrals to see specialists but do not cover out-of-network care

Preferred Provider Organization (PPO)

• Has premiums that are higher than HMOs and POS, but this plan allows you to see doctors and specialists both in and out of network

• Referrals are not needed for specialists

• Out-of-network providers generally have a higher out-of-pocket expense.

Affordable Care Act (ACA)

The Affordable Care Act (ACA), formerly known as “ObamaCare,” is one of the most important reforms to health insurance in the United States. It was established in 2010 by former U.S. President Barack Obama.

The ACA covers the section of the population who do not have workplace insurance or the financial means to purchase private insurance. The main aims of this program are to:

• make insurance available to a larger population;

• expand the Medicaid program to include all low-income adults; and

• support innovative, low-cost medical care.

  The Affordable Care Act created an online marketplace where individuals can shop for their own health insurance policies, regardless of whether or not they have a healthcare plan offered by their employer. Many of these plans are also subsidized by the government to ensure affordability for people of all income levels. The ACA mandated that employers with 50 or more full-time employees must offer health insurance to at least 95 percent of their full-time employees.

What's Next?

Next Class: Monday, 2/2/26

Lesson 1.2.1- Ethics and Laws in Healthcare