3.3-Overview of Participants

8/7/2019 3.3-Overview of Participants

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Overview of Participants

Patients are the individuals receiving medical care. They may be

young or old, male or female, rich or poor. They may be ill, inneed of surgery, or trying to stay well by receiving immunizations.

To receive medical care, a patient goes to a provider.Providers may be hospitals, physicians, or other institutionsor individuals. Physicians in the U.S. practice all branches ofmedicine.

Payors pay for the health care services. They may bepatients, private companies, or government programs.

Providers


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Payors

A payor is an organization that has contracted with a patient to pay for a patient's health care services.Payors may be either government agencies or private companies.


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The patient / his next kin become the payer if neither of the two (i.e. private company or government) havecontracted with the patient to pay for his/her health care services.


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Reimbursement System Health Care Reimbursement

Health Care reimbursement is the method by which providers charge and receive payment for their

services.

Although a patient may pay directly for a small portion of these services, the vast majority of these billsare paid to the provider by the patient's payor, or insurance company. They are referred to as third partypayors because the patient is the first party and the provider is the second party. The small portion paidfor is by the first party, the patient, is called the co-payment or co-insurance or deductible. Some patientsdo not have insurance coverage. These patients will pay the full amount for the rendered services.

It is very important in the U.S. for patients to have some form of health insurance to help them pay for the


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high costs for medical care.

Co-PaymentA small, fixed amount a patient directly pays a provider for specific services.

Co-InsuranceA fixed percentage a patient pays for services received after a deductible hasbeen paid; the insurance company pays the remaining percentage.

DeductibleA fixed amount per contractual period that a patient pays before health insurancewill begin to pay; this is only paid if provider services are obtained.

History of the U.S. Healthcare Reimbursement System

In the beginning of the 1900s, patients paid providers directly for services. Patients who could not afford topay for services relied on religious or charitable organizations to pay for their care or to provide free care.

Eventually, however, technological advances in health care made free care more expensive and difficultto provide. Covering the cost of someone elses care also became more difficult.

Thus health insurance was created in the 1930s. It was created to alleviate a patient's risk of not beingable to pay for future medical costs and a provider's risk of not being paid for services rendered.

In the 1940s, the U.S. government prohibited U.S. employers from giving raises to employees tohelp fund World War II. Employers began offering health insurance to employees as an incentive.

In the 1960s, the U.S. government enacted the Medicare and Medicaid program. The Medicareprogram was created to provide health insurance coverage to elderly and disabled individuals.This program is paid for through payroll taxes and individual patient premiums. The Medicaidprogram was created to provide health insurance coverage to the poor. These programs are

funded through U.S. Federal income taxes and State income taxes. Today, a large percentage of the U.S. population has health insurance through their employer.

Many also have health insurance through the government instead of a private company. Unfortunately, some U.S. residents do not have any health insurance coverage. These residents

are expected to pay out of pocket for health care services rendered by providers and areclassified as "Self Pay" in the Accounts Receivable lingo.

Reimbursement System Health Insurance Concept


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Anthony makes payments called "premiums" to an insurance company. This insurance coverage is referredto as his "insurance plan" with Anthony being the "enrollee" or "insured". The company offers manydifferent plans, so Anthony chooses one that fits his family's needs. Anthony is provided with a healthinsurance card for himself, his wife, and his child. This card contains patient identification information.Anthony is also provided a benefits contract that provides information on covered services, non-coveredservices and patient responsibilities.

Health insurance reduces Anthony's risk of being unable to pay future medical expenses. If Anthony, or hiswife or child, incurs medical expenses now, the insurance plan will pay for services agreed upon under theplan.

Six months after he enrolled in this insurance plan, Anthony had his gallbladder removed in a hospital. Whopaid the hospital bill?

Let's find out...

Reimbursement System Provider Payment by Insurance

How is a provider paid by health insurance?


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Providers

At this point in the course, we will learn more about providers.Who are they?Where are they located?What types of care do they give?

Providers Types of Care

All providers can be classified by the type of care they give.


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Providers Individual Providers

In the U.S. there are two main types of physicians:

Primary Care Physician (PCP)A primary care physician is trained in general medical care and treats routine problems. Some insuranceplans require patients to see their PCP first before they can see a specialist. In these cases, the PCP

serves as the initial contact between the patient and the medical system.

Specialty Care Physician (specialist)A specialty care physician has more advanced medical training and is certified to practice in a specificfield. A specialist treats complicated medical conditions in his/her area of training and generally chargesmore than a primary care doctor.

Providers Facility Providers

Listed below are the most common facilities

for health care in the U.S.


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We will start by examining hospitals, the providers we most frequently contract with inthe Central Business Office

Providers Facility Providers Hospitals

Hospitals provide the most comprehensive and intensive medical services available. There are two maintypes of hospitals:

Acute: This is the most common type of hospital. It serves patients on a short-term basis. Someexamples are children's, adult, and specialty hospitals.

Chronic: This hospital serves patients on a long-term basis. Some examples are skilled nursing andrehabilitative hospitals.

Providers Facility Providers Types of Hospital Care

Regardless of hospital type, all hospitals still provide three levels of care.Below are patient examples of these three levels of care.

Providers Facility Providers Ambulatory Surgery Center


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What is an Ambulatory Surgery Center?

Ambulatory surgery centers, or freestanding ambulatory centers, provide outpatient services. This day-care, or ambulatory, technique provides an efficient and flexible approach to the provision of many

surgical and therapeutic procedures. It is a freestanding facility, other than a physician's office, thatoperates exclusively to provide surgical services to patients who do not require hospitalization. These.centers may either be affiliated with a hospital or have no affiliation with a hospital

Advantages:

1. Faster recovery means less discomfort and generally better healing

2. Less disruption and time away from family and business commitments

3. Recovery in the comfort of the patient's own home

4. Reduction in cost of health care

Providers Facility Providers Skilled Nursing Facility

What is a Skilled Nursing Facility?

This facility provides long-term, inpatient, skilled nursing care and related services at a lesser intensitythan an acute facility such as a hospital. It is used for patients who need medical, nursing care, orrehabilitation services and usually costs less than a hospital.

There are four basic types of services that are offered by a skilled nursing facility and a non-skilled nursing facility:

1. Nursing and Rehabilitative ServicesNursing procedures require the professional skills of a registered or a licensed practical nurse. Theseskills include assessment, conducting treatments, injections, coordination care, and post-hospital stroke,heart attack, or orthopedic care. They are available with related services such as physical therapy,occupational therapy, speech therapy, dental services, dietary consultation, laboratory and x-ray services,and a pharmaceutical dispensary.

2. Personal CareThese services include help in walking, getting in and out of bed, bathing, toileting, dressing, and eating.Special dietary needs are also met if prescribed by a physician.

3. Residential ServicesThese include general supervision and provision of a protective environment, such as room and boardand a planned program for the social and spiritual needs of the resident.

4. Medical CareEach patient in a nursing facility is under the care of a physician, who visits periodically and is responsiblefor the patients overall plan of care. In most cases, the patients personal physician refers the patient tothe facility and certifies the need for admission. Once the patient is admitted, the physician writes orders


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for any necessary medication and plays a role in the development of the patient care plan, includingrestorative and rehabilitative procedures, special diets, and other treatments. Every nursing facility has atleast one physician on staff or on call to handle emergencies.

Nursing Facilities (NFs) provide nursing and limited rehabilitative and health-related services. Nursingcare is provided around the clock, with registered nurses available at least daily. Emphasis is onfunctionality for the individual, with services provided based on an interdisciplinary assessment of theresidents needs.

Skilled Nursing Facilities (SNFs) provide the same services, with increased emphasis on rehabilitativetherapies for convalescent patients.

Providers Facility Providers Home Health

What is Home Health Care?

Home care is a simple phrase that encompasses a wide range of health and social services. HomeHealth Care agencies are organizations which are engaged in providing services (medical and non-medical) to patients and their families in their home or place of residence according to a written plan oftreatment signed by the patients physician.These services are delivered to recovering, disabled, chronically, or terminally ill persons in need ofmedical, nursing, social, or therapeutic treatment or assistance with the essential activities of daily livingthat cannot be easily or effectively provided solely by family and friends.

These home health services include part-time or intermittent skilled nursing care and at least one of thefollowing:

1. Physical, Occupational, or Speech therapy2. Medical social services or home health aide services

Each person, private or public organization, political subdivision, or other governmental agency desiring tooperate a Home Health Agency, must first apply for and obtain a license. Without reimbursement ofservices provided to patients, it is difficult for home health capabilities to continue to expand. The listbelow is generally representative of services available, though specific coverage for services varies frominsurer to insurer.

1. Care of the Terminally ill


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Services provide an integrated array of supportive and clinical care, differing from hospice care becausepatients are able to continue to receive aggressive treatment. An agency does not have to be a Medicare-certified hospice to deliver these services.

2. Home Health AidesLicensed nursing assistants assist individuals with daily living activities and personal care. Specific dutiesdepend on the aides training and experience, and the needs of the individual.

3. Day Surgery Follow-upServices can include nursing evaluation, assessment, and rehabilitation therapy and support services tomonitor a patients progress and assess their condition. Home health agencies can assist with personalcare during the recuperative period. Nurses can perform blood draws in conjunction with follow-up neededfor symptom management and lab results.

4. Home VenipunctureBlood draws, blood screening tests, and lab work, including cultures and urinalysis. Home health agenciescan also serve as a liaison between the homebound patient and physician through blood tests.

5. HomemakersAssist with laundry, groceries, cleaning, and other routine household task

6. Intravenous TherapyCapabilities include IV starts and re-starts, care of peripheral, central, and PICC lines, instruction to bothpatients and caregivers, management of all types of pumps for hydration, hyper-alimentation, andmedication administration such a antibiotics, chemotherapy, and pain management.

7. Laboratory Support ServicesSpecimen collection and delivery to area laboratories for testing and analysis. Services may includevenipuncture, urine collection, wound culture, and sputum collection, among others.

8. Medical Social ServicesPsychosocial support and planning assistance for the individual and family regarding limitations of anillness or injury as well as assistance and coordination of additional required resources. Medical socialworkers explore current options, helping individuals make difficult decisions. They consider financialimplications and provide emotional support, enhancing the coping skills of the family or other caregivers.

9. NursingSkilled assessment, planning, monitoring, treatment, and evaluation.

10. Nutrition CounselingA registered dietitian assesses and plans for a patients nutritional needs, from basic meal planning tocomplex therapeutic diets.

11. Occupational TherapyEvaluates functional level, teaches therapeutic activities, fits self-help devices, adapts home environment,and provides adaptive equipment recommendations.

12. Patient EducationDisease process, treatments, equipment, medications, and diet consulting are some of the areas where


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staff helps educate patients and families.

13. Physical TherapyThe use of evaluation and assessment, therapeutic exercises, massage, heat, cold or electrical

treatments, and home adaptation by a physical therapist as part of the treatment plan.

14. Pre-Surgery Assessment and Pre-Op TeachingWorking closely with the physician and the hospital, home health care staff provides instruction on post-opprecautions and proper use of ambulatory assistive devices. Pre-op strengthening exercises betterprepare the individual for surgery, decreasing hospital stay and increasing patient recovery.

15. Speech TherapyAssessment and treatment for those with an illness or injury, which affects speaking and hearing abilities,language skills, or swallowing.

Providers Facility Providers Hospice

What is Hospice?This is a freestanding or hospital facility in which palliative and supportive care are provided to terminallyill patients and their families. Hospices emphasize counseling, pain relief, and symptom management.

Hospice programs make it possible for terminally ill persons (patients with a life expectancy of not morethan six months) to spend the final stages of their lives at home or in home-like settings. An emphasis onpalliative and supportive care will enable them and their families to cope with this difficult transition. It is aphilosophy of care that accepts death as a natural part of life, seeking neither to hasten nor to prolong thedying process. Hospice is care that strives to help patients truly "live until they die".

Hospices can be hospital-based or freestanding. Only terminally ill patients are eligible for hospice care. Itis a comprehensive, medically-directed, team-oriented program of care that seeks to treat, comfort, andcounsel the terminally ill individuals and their families on pain relief and management, symptommanagement and control as clinical goals, and understanding that psychological and spiritual pain are assignificant as physical pain. Treatment of the terminal illness ceases when a patient chooses hospicecare, only symptom management remains and treatments for any other illness besides the one causing

death

Payors

Who Pays The Bills?


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Payors are third parties who pay for most, if not all, of an enrollee's health care through direct payments tothe enrollee's provider. These private companies or government agencies help individuals reduce theirpersonal financial risk. Each payor has its own set of covered benefits, payment mechanism, andregulations.

Payors Types of Payors

Although many types of payors exist, the CBO works with some payors more frequently than others.Listed below you will find the most common types of payors involved in our work:

Payors Medicare

Medicare Overview

Medicare is a U.S. Federal government program which pays for certain health care services. It originatedfrom a Federal law under the Social Security Act. Improper billing of medical claims is a Federal violation.Several providers have been accused and convicted or entered into settlement due to improper orfradulent billing violation.

Because many U.S. employees stop working between age 6265, Medicare mostly insures those nolonger eligible for an employer's health insurance coverage.

A person can have Medicare coverage through:

Medicare Part A, also know as Hospital Insurance


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Medicare Part B, also know as Supplemental Medical Insurance Medicare Part C, also know as Medicare Managed Care

Although Medicare is comprehensive coverage, persons with Parts A and B will still not have all theirhealth care services covered. Sometimes, Medicare enrollees will also purchase additional insurance froma private company to cover costs these plans do not cover. This is called "Medigap."

Payors Medicare Medicare Part A

The following points describe coverage with Medicare A:

Hospital insurance plan, which covers the costs of stay in a hospital or skilled nursing facility. Thiscoverage also will cover home health services and hospice care.

Financed mostly through taxes on employers and employees.

People who qualify for Medicare receive Part A automatically, at no cost, provided that they ortheir spouse have paid a certain level of Social Security taxes or premiums for at least ten years.An individual will have to pay premiums if they or their spouse have not paid the necessaryamount in social security taxes or premiums.

MEDICARE PART A COVERS

Hospital Stays Skilled Nursing Facility Care Limitation on Number of Days Home Health Care Limitation on Number of Days Hospice Care

Payors Medicare Medicare Part B

The following points describe coverage with Medicare B:

Optional, supplementary medical insurance that pays for physician services and other servicesnot covered under Part A. This coverage will pay for physician services, outpatient hospitalservices, durable medical equipment, and other medical services or supplies which are notcovered under the Part A program.

Funded by premiums paid by those eligible for Part A.

People who qualify for Medicare Part A do not automatically receive MedicarePart B. They must purchase this coverage.

MEDICARE PART B COVERS

Doctors Services (except routine physical examinations) Outpatient Hospital Services Home Health Care Medical and Surgical Services and Supplies Clinical Laboratory Services Durable Medical Equipment Dialysis Services


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Payors Medicare Managed Care Program (Medicare + Choice)Medicare Part C

The Balanced Budget Act of 1997 (BBA) added Part C to Medicare+Choice. Medicare+Choice permitsMedicare beneficiaries to select health plans, available in many areas of the country, where beneficiariesgo to doctors, specialists, or hospitals that participate in the plan. In these plans, a PCP typically managesa patient's care. Under Part A and Part B, a patient can generally be treated by, or in, any Medicareparticipating entity or provider.

Some managed care plans cover extra benefits, like outpatient prescription drugs and hearing aids.

The following points describe coverage with Medicare Part C

A person must be eligible for Medicare Part A and B to qualify for Medicare Part C

Under Medicare Part C a persons access to health care may be restricted to certain doctors andproviders.

A person will continue to pay their monthly part B premiums. They may also have to pay anadditional monthly payment.

Medicaid

Medicaid is a joint Federal and State program that pays for health care services rendered to certain poor,medically needy, aged, blind, or disabled individuals.

It is funded by State and Federal taxes and originated from a federal law under the Social Security Act.

Those eligible for Medicaid do not have to pay directly for it or pay taxes to get it.

Within certain federal guidelines, each State operates its own Medicaid program. Each State's Medicaidprogram has its own features, benefits, costs, and regulations.

Medicaid does not provide medical assistance for all poor persons. Eligibility depends on a family'sincomeFamily income versus Federal Poverty Level (FPL).

Generally States offer coverage to one or more of the following groups:

Mandatory: To be eligible for federal funds the States are required to provide Medicaid coveragefor certain individuals and groups of people. Because every State in the country has its ownMedicaid program and seeks federal funding to support the program, the following categories ofpeople have been made eligible in every State:

o Low-income families with childreno Aged, blind, or disabled individuals on Supplemental Security Income (SSI)o Certain low-income pregnant women and children

Categorically Needy: States also have the option to provide Medicaid coverage for other"categorically needy" groups. These optional groups share characteristics of the mandatorygroups, but the eligibility criteria are somewhat more liberally defined. In general, the categoricallyneedy may have the same conditions as the mandatory eligible but have higher incomes.


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Medically Needy: The option to have a "medically needy" program allows States to extendMedicaid eligibility to additional qualified persons who may have too much income to qualify underthe mandatory or optional categorically needy groups. This option requires individuals to spenddown their assets. They will have Medicaid coverage but Medicaid will not reimburse any servicesuntil this spend down occurs.

Latest Trends

The most significant trend in service delivery is the rapid growth in managed care enrollment withinMedicaid. By the end of the 1990s, States had moved more than half of their mothers and children intomanaged care programs (defined broadly) in an effort to contain costs and link participants with a primarycare provider.

Payors Commercial Insurance

Is it a type of plan or a type of company? Well, it is both.

Payors Managed Care


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Again, this is not only a type of care, but a type of company plan as well.

Payors Types of Managed Care


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Each type of plan has a different balance of these two factors.In general, the choicer a patient has in which provider he can see,

the more expensive the plan.

Payors Managed Care HMO

Health Maintenance Organization

An HMO consists of a network of physicians, hospitals, and other providers that have contracted with aninsurance company to manage an enrollee's care. Services rendered by providers outside the network arenot covered.

In an HMO, a patient must first see a primary care physician (PCP). This may be a doctor trained ininternal medicine, family medicine, pediatrics, or obstetrics/gynecology, depending on the age and sex ofthe patient. The PCP manages the patient's care and refers to a specialist or other provider as necessary.


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Payors Managed Care POS

Point of Service

In a POS plan, a patient can choose to use in-network providers (like an HMO) or out-of-networkproviders at a different fee (we will learn about those next under "Preferred Provider Organizations").

Payors Managed Care PPO

Preferred Provider Organization


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A PPO is a group of providers who have agreed to discount their services for a specific insurance plan.This provider group is generally much larger than the network in an HMO and POS.

With PPOs, the PCP does not manage a patients care. A patient can choose to see any physician amongthe providers offering discounts.

Payors Blue Cross/Blue Shield

Blue Cross/Blue Shield was one of the first private health insurance organizations in the U.S. It is a not-for-profit company offering health insurance through more than 70 different organizations, located inevery State. It has a large enrollee population.

Within general guidelines, each individual organization operates as a separate company with its ownbenefits and payment policies. BC/BS (Blue Cross/Blue Shield) organizations, like commercial insurancecompanies, offer both individual and group plans that can be commercial insurance plans or managed

care plans.

Payors No Fault/Non No Fault Auto/Liability


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Although not specifically health insurance, these other types of insurance cover medical care in somecases.

No Fault/Non No Fault AutoIn some States automobile accident victims who need medical care automatically receive coverage fromtheir automobile insurance carrier. In certain States, auto insurance is no fault coverage. In these States,

each driver involved in the accident will have their services paid by their own insurance. There aretypically medical service coverage limits on these policies. When the policy has paid up to these limits, thepolicy is exhausted (No Fault). In other States, a determination relating to who is responsible for theaccident is made. The responsible individual's insurance will pay for the associated medical care up to thepoint the policy exhausts (Non No Fault).

LiabilityThis type of insurance provides personal injury or medical expense coverage through homeowner orproperty insurance.

Business Liability: Essentially, liability insurance is there to clean up after business's mistakes,providing coverage for claims related to negligent business activities (injury related to the use of aproduct, for example) or the failure to use reasonable care.

General Liability Coverage: General liability covers any bodily or personal injury of a third partyand your premises due to negligence. The insurer typically pays damages and legal defense feesas well as case-settlement charges. This typically covers bodily injury, property damage, andpersonal injury.

Umbrella Coverage: An accident on your property, or damage caused by you - like a serious fallon icy steps or luggage flying off the top of your vancould easily jeopardize your financialsecurity. Personal Catastrophe Liability Coverage protects the enrollee, the spouse, and anyrelatives living in the household.

Homeowners Insurance: Homeowners insurance provides the basic coverage needed forpersonal possessions and dwelling, whether it is the primary residence or a vacation home. Thispolicy covers loss or damage to dwellings or contents, personal liability for injury, living expenseswhen your home is damaged, and medical payments for others injured on your property.

Payors Worker's Compensation

This is an insurance system for employees who have been injured while performing their job or havebecome ill due to a work environmental hazard.

Employees are eligible to receive a percentage of their wages and medical care

depending on the time off required before they can work again and the extent ofmedical treatment needed.

Funding is provided by employer taxes; employees are not charged premiums.


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Although required by the government, each State has its own regulations governing the system in thatState.

3.3-Overview of Participants

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