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- HIP stands for “Health Insurance Plan”
- Obamacare uses qualified health insurance plans
- Open enrollment for Obamacare Health Insurance Plans begins November 1, 2017
- Health Insurance Plan includes many types of managed health care
- HIP is federal employee health insurance plans local partner
At the center of healthcare reform in the US is the HIP- the Health Insurance Plan. Obamacare consists of qualified Health Insurance Plans; OPM also provides qualified health insurance plans for federal employees.
A HIP has a cost, and it has benefits. Most important, it is the law that we have one or face a tax penalty for no insurance. HIP or Health Insurance Plan is an important phrase that identifies health insurance activities in the Obamacare Marketplace, the federal service, and elsewhere.
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The Individual Mandate
The Affordable Care Act requires citizens and legal residents to get and keep qualified health insurance coverage.
Failure to do so will trigger a tax penalty called the individual shared responsibility payment.
The individual mandate applies to everyone that is not exempt, unlawfully present, or not required to file a federal tax return.
What is a Health Insurance Plan?
The heart of the health care system is the individual health insurance plan.
The Affordable Care Act requires insurance coverage for nearly everyone; the coverage must meet standards for minimum value and provide the essential health benefits.
Comparison shopping is the proven method for finding the right policy for an individual or family. When considering choices, it can account for needs and preferences as well as costs.
HIP in the Public and Federal System
Local health insurance plans came into wide use for public employees in major cities. HIP in New York City and elsewhere were early pioneers in public employee health care.
These original HIP entities were privatized into non-profit corporations and continue to serve municipal employees and other public and federal employees and local HMO or PPO organizations. They connect with federal fixed-fee-for service networks to provide PPO, POS, or HMO options.
HDHP stands for the high deductible health plan. The federal rules set minimums for the deductible required, and maximums for contribution to the tax advantaged account for individual and families.
Federal Employee Health Benefits
In the federal employee system, there are some distinct types of health insurance plans. The national system connects to networks and providers of health insurance plans across the US.
Fixed fee for service plans have two types one with a PPO and one without. With no PPO subscribers pick the medical providers and use them. They must pay then file paperwork for reimbursement.
Fixed fee with a PPO offers less paperwork when using PPO resources and lower cost sharing when going outside the network. The PPO option depends on available PPOs in a given geographic area.
HMO can work well with or without the POS option. With no POS option, the HMO ties the consumer to network resources, and only when referred by the primary care physician. The POS option permits the use of outside resources at lower insurance company cost sharing.
Consumer Driven Health Plans include Health Savings Accounts, Health Reimbursement Accounts, and High Deductible Health Plans. These flexible arrangements help consumers by offering funds to reduce the costs of high deductibles and out-of-pocket expenses.
After using the agreed amount of funds, the consumer pays higher amounts of costs.
Open Enrollment Period
The annual period for signing up for health insurance is called the open enrollment period. During the open enrollment, consumers can perform the below-listed functions.
- Sign up for new health insurance
- Renew a policy
- Buy a policy, cancel and switch to a different policy
Four Types of Marketplace Policies
The Obamacare marketplace offers four types or tiers of health insurance plans. Identified by metallic bands, these groups have similar actuarial value. They offer a wide range of managed care including HMO, PPO, EPO, and POS.
– Platinum Plans
These plans have the highest premiums and lowest deductibles. Platinum plans divide costs on a 90 percent to 10 percent ratio. They have low copays and coinsurance rates, too.
These are ideal plans for those with heavy demands for medical services. They can reach the deductible threshold, get low copays and coinsurance, and in many cases reach the out-of-pocket maximum to get 100 percent insurance coverage of essential benefits.
It is important to select a plan that offers needed services within its network.
– Gold Plans
Gold plans offer excellent coverage of essential benefits at an 80 percent to 20 percent ratio for the consumer. The have high premiums and relatively low deductibles.
Getting to cost sharing quickly, these are excellent plans for those with moderate to heavy demands for medical services. The offer low copays and low coinsurance.
– Silver Plans
Silver plans provide a 70 percent to 30 percent split between the insurance company and subscriber. These plans have moderate deductibles and can take Health Savings Accounts in the HDHP category.
Silver plans work best for those with moderate healthcare needs and able to take advantage of savings feature to reduce the impact of deductibles.
– Bronze Plans
A bronze plan is the best choice for those seeking low premiums and requiring a low amount of care. These plans divide costs on a 60 percent to 40 percent split. The deductibles are high and not likely reached by healthy individuals.
These plans offer the required free and preventive services, high copays, and high rates in coinsurance.
Types of Managed Care Organizations
The health insurance plan takes on particular features from the type of managed care network. The keys are network versus outside resources, and the counting if expenses towards deductible and out-of-pocket limits.
This stands for health maintenance organization. The early HMOs were pioneers in the areas of wellness and prevention.
HMO managers designed their systems to be low-cost and simple systems. They used a single physician to guide the care of each patient.
Called a primary care physician, this person took responsibility for overseeing the care for each assigned member. This primary doctor provided care and made referrals to other network resources and specialists. Once past the deductible, the HMO shared costs with the consumer through coinsurance and copays.
PPO means “preferred provider organization.” The PPO offers more freedom for the customers. They do not need a primary care doctor or referrals. They can choose among network resources and get the maximum shared insurance.
Once paid, the deductible triggers coinsurance, and copays for network resources. Customers can choose to go outside of the network. The PPO covers this, but the consumer pays a greater share of the costs.
This stands for the “health maintenance organization with a point of sale option.” The point of sale option is a tool for greater flexibility in the traditional HMO.
The primary care physician monitors medical care in this model and makes referrals to needed resources.
The POS option permits referrals to outside resources and provides some level of costs sharing.
Private fixed-fee-for-services organizations are sometimes small organizations of medical service providers that accept an agreed fee for treating patients
This is the “exclusive provider organization.” This network provides all of the resources that the plan provides cost sharing. EPO plans do not pay for services outside of the network.
Like the PPO, the EPO permits its subscribers to have free access to network resources with no primary care physician and no referrals.
Deductibles, Copay, and Coinsurance
Premiums may not be the largest expense in health insurance plans. For many consumers, deductibles and out of pocket expenses cost more.
Deductibles trigger the insurance company obligation to share costs with the policyholder.
Once passed, the deductible causes copays and coinsurance for each service rather than paying the entire amount.
Deductible and Out-of-pocket Limits
The Affordable Care Act reformed healthcare in the US. It banned denials of insurance based on pre-existing conditions and most forms of price discrimination.
The rules that carry out the law set limits for all insurance policies on deductibles and out-of-pocket costs.
The problem is that these limits only apply to plans and their network resources. The out-of-pocket limit for qualified health plans does not include consumer spending on non-network resources or non-essential services.
The below-listed items describe deductible and out-of-pocket limits.
- The 2017 out-of-pocket limit for individuals is $7,150.00.
- The 2017 out-of-pocket limit for families is $14,300.00.
- The 2017 deductible limit for individuals is $7,150.00.
- The 2017 deductible limit for families is $14,300.00.
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