Essay On Cost Sharing

As far as insurance plans go, generally there are three plans a patient will have, they are Health Maintenance Organization (HM0), Preferred Provider Organization (PPO) and Point-of-Service (POS).

President Roosevelt’s New Deal programs were both supported and opposed by the American people. Among the New Deal’s opposers was Huey Long, a U.S. senator from Louisiana. Long believed that Roosevelt’s programs did not help the majority of the population as much as they should have. In response, Long suggested a plan for the redistribution of wealth; he proposed a program which provided for a proper standard of living for all by dispersing the nation’s wealth throughout the country. This plan was known as the Share Our Wealth plan. To carry it out, Long formed an organization for the cause in 1934, and in 1935, he gave a speech to the members of the Share Our Wealth Society.

The types of managed care are differentiated by definition, operation, structure, and information needs. `HMOs were the most common type of MCO until commercial insurance companies developed PPOs to compete with HMOs' (Douglas, 2003, p.331). `HMOs are business entities that either arrange for or provide health services to an enrolled population after prepayment of a fixed sum of money, called a premium' (Peden, 1998, p.78). There are three characteristics that an HMO must have. The first is a health care financing and delivery system that provides services for members in a particular geographic area. Second, is ensured access to a complete range of health care services, health maintenance, treatment, and routine checkups. Last, health care must be obtained from voluntary personnel that participate in the HMO. The five HMO models related to the participating physicians are the Staff

The policy states that if a patient has a copay or any other payment that needs to be made then he/she should do so at the time of their visit. This is usually done at the end of the visit encase the doctor orders any tests or lab work that might cost the patient more money. Patient’s should be informed of all or any charges and given an estimated cost.

Within the formulary the drugs are divided into tiers. Co-payments are based on the tier that the drug is in and range from tier 1, the least expensive drugs, to tier 3 the most expensive drugs. Each insurance company plan is allowed to add or drop drugs from their formularies and move drugs from one tier level to another throughout the year. An insurance company can also drop a drug in the middle of the year, but must continue covering the drug for anyone taking it until the next reenrollment period, at which time a new plan will have to be chosen that covers that drug (Gustaitis, 2007). Although not used a lot there is a fourth tier that is for specialty drugs only. Some plans use a flat-rate or assign a percentage co-pay to the higher tier drugs (Gustaitis, 2007). Other characteristics of the insurance company plans that they have control over are requiring prior authorization for a drug, using step therapy, limiting the quantity, participating at certain pharmacies, and having preferred pharmacies (Gustaitis, 2007).

The patient is informed about their coverage and the amount of copayment they would have to pay.

The coinsurance is the amount you are obligated to pay after the deductible is paid that year. The deductible, the amount paid for medical need before the insurance company starts paying for services. Plan A is $5,000 and Plan B’s is $10,000.

plan, you will typically have no deductible and the co-payments often range from $10 to $20

The second obligation pertained to the circulation of the yearly prescription costs that followed the simple design for health costs which was normally the main part of the program’s expenses which were caused by a small number of the programs enrollees. The costs from the small amount of enrollees have the ability to be an enormous amount. Therefore, in order for the Medicare prescription program to offer most support for the participants that required it more than the catastrophic coverage had to have a lower co-pay amount attached to it. The model’s ending fee level has a five percent co-insurance obligation without a limit of on coverage. (Kaplan 2011)

Preferred provider organizations have also contracted with hospitals and physicians to provide health-care services. Unlike the case with an HMO, you do not have to go to these physicians. However, you will pay more if you go outside the list of preferred providers. PPO plans usually have a deductible, which is the amount that the insured must pay before the PPO begins to pay. When the PPO plan does start to pay, it will usually pay a percentage of the bill and you have to pay the remainder, which is called “coinsurance.” Most plans have an out-of-pocket maximum. This helps protect you from paying more than a certain amount per year. After you exceed the out-of-pocket maximum, the coinsurance percentage paid by the PPO increases to 100%. (www.ajmc.com)

: Insurance companies have the list of formularies that they agree to help cover but it is a tricky and a hassle to deal with. The patient must get a prescription of a similar drug first to make sure it works on them or even getting the doctor to prove that you need it. This is just to get coverage for an expensive drug. This can take weeks to do. It is a complicated list designed to give the patient the right drug for their conditions and that drug may not even be the first one that the doctor prescribes for them. It is a process to find out which one is right. When you fill a prescription of an approved drug of the formulary then you do not have to pay full price. Patients will have a copay through four different tiers. The first tier the patient pays a $20 copay on generic medications or a low cost medication, on the second tier, the patient pays a $40 copay for low cost brand names or a higher priced generic name drug. The third tier, the patient pays a $60 copay for brand name medication in which there is no generic, and the last and final tier which is number 4, the patient pays a $100 for the highest cost medication and/ or specialty drugs such as ones for chemotherapy. Some health care plan require the patient to pay full price for medication until they meet the deductible and then they can pay copays. Some formularies have coinsurance instead. The patient in these pays a percentage of

The PPO gives discounts, with its doctors and hospitals that participation, and then pays a fee for services given. Patients have a list that they can pick from for a primary physician. The patient pays a set fee per office visit and the insurance provider pays the rest. It’s basically a co-payment which depends on what type of plan they have. However, like an HMO, the PPO has to choose a physician in that network, if they don’t they may be charged a penalty.

To start with, we must first understand what a managerial strategy means and how we can apply the appropriately.

Opportunity cost is the value of the next best alternative in a decision. Imagine that you have $150 to see a concert. You can either see "Hot Stuff" or you can see "Good Times Band." Assume that you value Hot Stuff's concert at $225 and Good Times' concert at $150. Both concerts cost $150 per ticket, but it would take you a couple of hours to drive to Hot Stuff's concert and you have to be in school (the next) morning for an exam. Good Times' concert is right here in town. Explain how you would assess the opportunity cost of seeing Good Times in concert. What is the opportunity cost of going to Good Times' concert?

Budget is the major financial and economic statement. The role of the budget is to keep track of the money coming in and the money going out. It is essential part of running any business effectively. It can help make a short and long term projections about financial situation, avert a financial crisis and plan for major financial changes.