Health Insurance, Term Paper Example

With the Affordable Healthcare Act prominent in each individuals mind, it is important to understand health insurance coverage. Health insurance options vary on an individual basis. Each person qualifies for a different type of coverage based on age and employment status. The Commonwealth of Virginia has specific guidelines regarding health insurance coverage.

Health insurance is also known as accident and sickness insurance (Mitchell, 2012). Health coverage can be obtained through private insurers as well as government programs. The principle types of contracts include medical expense, dental expense, managed care health insurance plans, disability coverage, and long-term care expense (Mitchell, 2012). These options are often available as individual or group plans. Group plans are often offered by employers to employees. Government programs include Medicaid and Medicare.

Group plans include employer group health insurance, COBRA, and small employer medical plans (Mitchell, 2012). Employer group plans are offered to employees who are considered full-time and work 30 hours or more per week. These plans will also cover dependent children under the age of 26 (Mitchell, 2012). If a dependent child is eligible for insurance from both parents employment, the birthday rule, or whichever parent’s birthday comes first, is used to determine the primary payer of insurance (Mitchell, 2012). Many times full-time employees will not have to pay premiums, however deductibles and co-pays are common.

In the event that an employee loses eligibility for a group plan offered through employment, the employee is eligible for COBRA. Cobra, or the Consolidated Omnibus Budget Reconciliation Act, allows in employees to stay within the group plan for up to 36 months, but the employee is now responsible for the premiums that can be as much as 102% of the group rate (Mitchell, 2012).

Small employers, or businesses that have 50 employees or fewer, can offer health insurance. If the business has 50 or more full time employees, these employees must be covered by an employer health coverage plan; part time employees do not have to be offered the same benefits (Cahill, 2013). Part time employees will often still be responsible for providing their own health coverage.

Because there are many groups of people who do not qualify for employer benefits, Medicare, or Medicare, there are a variety of individual insurance plans available to purchase. Groups that need to utilize individual plans are self-employed, part-time employees, seasonal employees, temporary employees, and also employees who work for businesses with less than 50 employees. These plans vary in the premiums, co-pays, coinsurance, and deductibles. Premiums are based on the health and preexisting conditions of the person. Co-pays are a specific amount of money that a person must pay at each doctors visit (Mathews, 2013). Coinsurance is the split cost of the insurance (Mathews, 2013). This will often be between 10% and 30%, depending on the insurance contract issued. A deductible is the amount of money that must be paid for a service before the insurance will pay the remaining cost; $500 being the most common in individual plans (Mathews, 2013).

The different types of individual and group plans are Managed Care Health Insurance Plans (MCHIP), Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), and Point-Of-Service Plan (POS). MCHIP a subscriber pays a monthly fee, or premium, and is entitled to receive all necessary services (Mitchell, 2012). With an HMO, the insured pays a fixed monthly fee and receives all necessary services, however, HMO’s usually charge a co-payment and the patient must stay within a specific network (Mitchell, 2012). PPO’s is usually an employer group that contracts with the group to provide services at a reduced rate; co-payments, coinsurance, and deductibles are present in this situation at a reduced rate (Mitchell, 2012). A POS plan allows members to receive care out of network without a referral (Mitchell, 2012). All of these plans are helpful, but have out of pocket costs whether they are group plans or individual plans.

College students are often covered by their parents’ insurance if under the age of 26. If this is not an option, students are responsible for their own health coverage. Sometimes the institution that they attend will offer discounted insurance, especially for medical students. At times, if living on campus, there will be a medical facility available. This varies from institution to institution. More often than not, a college student will have to seek an individual plan and pay out of pocket.

Seniors or persons aged 65 years or older qualify for Medicare as long as they are fully insured under Social Security. If not fully insured, Medicare can be purchased. Enrollment is handled by the Social Security Administration and is also funded in this way (Mitchell, 2012). The most common Medicare options are Part A and B. Part A, Hospital Insurance, is automatic and free (Mitchell, 2012). Part B, medical insurance, is not free and is dependent on income (Mitchell, 2012). Parts C is an HMO option and Part D is help with prescription drugs.

Medicare does not cover every health insurance claim. For the gaps that exist, Medigap insurance is available (Mitchell, 2012). There are a variety of policies that can be purchased to help with the extra costs.

Families whose incomes are below 133% of the poverty line are often covered by Medicaid. Medicaid is a state and federally funded program that allow families to benefit from health insurance coverage when they cannot afford their own coverage (Virginia Medicaid, 2013). To qualify for this program, candidates must be residents of Virginia, in need of health care due to low income (Virginia Medicaid, 2013). Medicaid also covers pregnant women, caretakers of dependent children under the age of 19, under the age of 21 and in foster care, blind, disabled, or over the age of 65 (Virginia Medicaid, 2013). If eligible for Medicaid there are no enrollment fees or premiums, however low co-pays are charged for some services (Virginia Medicaid, 2013).

For families who do not qualify for Medicaid, but do not earn enough to afford private insurance, the Family Access to Medical Insurance Security Plan (FAMIS), is available (Mitchell, 2012). This service is offered for free or a low cost to families who qualify. This service will only cover children under the age of 19 without any other health coverage (Mitchell, 2012).

Though some helpful programs are available, they are not available to all people. Many people go without health insurance due to the high cost. As of 2014, this will not be an option because of the Affordable Care Act.

Health Insurance is a major topic of discussion and a worry for many. There are many different plans available. These plans are dependent on the income of an individual as well as their age. Government programs are available for some individuals, but not all. For many, health care coverage is the responsibility of the individual and there can be many costs associated with the coverage.

References

Cahill, M. (2013, April 3). How will the Affordable Care Act Affect my Small Business. Retrieved from Bplans: http://www.upandrunning.bplans.com

Mathews, J. (2013, May 7). Health Insurance: What you should Know. Retrieved from Summit Medical Group: http//:www.summitmedicalgroup.com

Mitchell, D. (2012). Virginia Life, Annuity, and Health. Financial Academy.

Virginia Medicaid. (2013). Retrieved from Benefits.gov: http://www.benefits.gov