Comparing Cost Control Strategies
Kristy Barbeau
HCR/230
Wednesday January 22, 2014
Beth Schalm

Comparing Cost Control Strategies
Employer sponsored insurance falls under what is called group health plans. When an employee has this coverage the group are the ones that are the policyholders. The health care plans are negotiated through the human resources department and they select what plans to offer the employee. Most plans are the basic plans and that is where the riders come in. what riders mean is it gives the employee the option to choose what health care plan they want to choose. These options may include vision and dental add-ons. Another rider could be services such as massages, nutrition counseling, and possible vitamin supplements. Some insurance plans would not cover these things. It just depends on the plan that is chosen. An employer may also choose the Federal Employee Health Benefits Program (FEHB), which happens to be the largest health care program that the employers use. However, the government controls this plan. This is the plan they use for the government workers, people who retired from the government, and their families. Another plan that employers use is the Self-Funded Health Plans. This is for many large companies to ensure the cost of the employees’ medical benefits come from them rather than buying them from different insurance companies. This plan is basically a self-insured plan but the employer sets the level of benefits the employee gets. For this plan they bring in a third-party claim administrator to collect the money for the premiums and make sure the employees are up to date and paying their bills.
When employers offer insurance plans it is usually after so many workdays such as thirty, sixty, or ninety days. Then there comes a period called open enrollment periods which gives the employees the chance to choose their insurance benefits for the upcoming benefit year and they fill out the required forms to apply for that certain type of plan. Employers make sure that the employee has all the information they need to select the right plan for the individual and for their family and the cost of those plans. The only way the enrollment can be changed is if the employee gets married, has a child, or someone on the plan becomes deceased then the employee can make changes to their plan.
Provider networks are set up for the insurance companies. Most insurance companies give you a list of providers that are in their network that they will cover so they will pay for the medical expenses for those particular doctors and hospitals that are in their network. If you go to someone outside of their network it is likely that they won’t cover the whole bill or not cover it at all. This is why they prefer that it is an in network provider. Also some providers may not take your type of insurance because they don’t have a contract with that company. When an insurance company has a contract with a certain provider the insurance company gets a discount based on the services rendered. The patient can see a provider outside the network but the deductible will more than likely be higher than they would be normally pay with an in network provider. The patient will have to pay more out of pocket expenses for out of network providers.
Third-party administrators are brought out on self-funded plans and self-insured plans to make sure that claims are being filed correctly and the employees plan is the right amount for that person. They are also responsible for keeping an eye on the claims and making sure that they are collecting the right money from the right people and making sure the bills get paid from the patients. The employers hire these third-party administrators to make sure that the Self-funded plan is the way it is supposed to be so that there are no discrepancies.
Portability is a problem because it has certain regulations for many things such as changing jobs, a woman being pregnant, and different illnesses. When people change jobs their health insurance is covered by something called cobra, which means they can still have their insurance but they have to pay a discounted price out of pocket to keep the insurance. Some folks have problems doing this but it is an option that is given to them so that they may keep their health insurance for a certain amount of time. Another problem that is cause is that most insurance don’t want to cover people that have a condition before they got the insurance because they call it a preexisting condition. However, HIPPA added rules to individual plans that cannot prevent people from having insurance because of having preexisting illness as long as it is within a certain amount of days before the person got the insurance. The insurance company can only look back six months for conditions patients have, however if they go back further than that, HIPPA steps in and takes control to make sure the patient is being treated fairly by the company.
Creditable coverage is a group plan such as Medicaid or Medicare. Some people may this that medical discount cards are creditable insurance coverage but unfortunately it isn’t. It is also when People are covered under Insurance plans before and did not let it lapse before he or she enrolled in a new insurance plan it will make a difference when it comes to a waiting period it just depends on the company on how long the waiting period is. So in closing employer insurance is difficult and hard to choose from but health insurance is a good thing to have for those unexpected doctor and hospital visits.

References

Valerius, J., Bayes, N., & Newby, C. (2014). Medical Insurance: An Integrated Claims Process Approach (6th ed.). Boston, MA: McGraw-Hill.