Insurance (Medicare, Medicaid, COBRA, CHIP, Payments, and Plans)

In this video we are going to be talking about health insurance this is brought to you by dirty medicine if you like my channel and want to give back to support the channel financially please consider clicking the join button you can find that join button underneath any video on my channel as well as the it's the link in the.

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As well so if you like the channel and want to support free medical education please consider clicking join now in this video we're going to be talking about health insurance and health insurance is a topic that a lot of us know about but it seems like a lot of.

Medical students simply don't understand it we know that health insurance exists we know its purpose but we don't know the ins and outs of health insurance and therefore when health insurance questions show up on usmle complex or in-class exams a lot of times we are left twiddling our thumbs.

Feeling unintelligent and hey you cannot be a doctor if you don't understand health insurance right it's an integral part of our role it is involved in everything that we do except for you bougie plastic surgeons that don't take any insurance i'm not talking about you.

But everybody else needs to understand health insurance so let's get started by talking about medicare so who's eligible to be on medicare medicare is for those who are 65 years or older but you can also get on medicare even if you're younger than that if you have end-stage renal disease.

Or amyotrophic lateral sclerosis so end-stage renal disease or als qualifies you for medicare and you also can qualify for medicare if you receive a disability pension from the railroad retirement board and that that last bullet point there is just something that a lot of medical students don't know or doesn't get.

Taught correctly so these are the things that qualify you for medicare 65 or older or 64 and younger if you have end adrenal als or receive disability pension from the railroad retirement board all right so that's your eligibility to be on medicare but what's really high yield for exams.

Is to understand the different parts of medicare and these are depicted with letters so like part a part b et cetera so let's go through them one at a time and talk about what each part pays for because after all medicare is a type of health insurance and therefore it's paying for various.

Health care services so the first part of medicare is part a part a is insurance for hospital stays skilled nursing facilities hospice and some if not most home health care services in other words the way to remember this is that medicare part a.

Is the inpatient level of care so just remember the a in inpatient for medicare part a impatient impatient so inpatient hospitalization inpatient skilled nursing inpatient hospice and technically home health care some people could argue that that's.

Inpatient as well part a pays for inpatient levels of care medicare part b this is your typical insurance like what you think of when you think of health insurance that's what medicare part b pays for so we're talking about things like outpatient visits with a primary.

Care physician or a specialist ordering medical supplies all types of preventative care blood work and ambulance transportation this is all paid for by medicare part b so medicare part b pays for the basic stuff.

That's how you remember this the next part is medicare part c and you might see this referred to as medicare advantage medicare part c is basically the private insurance alternative to medicare so although it's part of the medicare program it's a little carve out within.

Medicare that functions most closely to how private insurance works and just to clarify what i mean when i say private insurance i'm talking about privately run companies that sell health insurance usually directly to places of employment who then make their employees part of.

Their health insurance plan that's a private health insurance but a public program like medicare and what we'll talk about in a little bit medicaid those are federal and state-run programs that are sponsored by tax dollars so for medicare part c although it is.

Part of the federal public program of medicare it is most similar to how private insurance works now there's not a whole lot you need to know about medicare part c for the purposes of usmle complex or in-class exams but just know that it's known as.

Medicare advantage that it's similar to how private insurance functions and that essentially if you think about what it is composed of it's medicare part a plus medicare part b and then usually plus part d which we'll talk about.

In just a second so the way to remember medicare part c is that medicare part c is private company care and just remember the letter c in company and care to help you remember that medicare part c functions most similarly to private insurance so.

Private company care now lastly let's talk about medicare part d medicare part d covers prescription drug medications and these drugs are usually on an allowable formulary which means unfortunately for some patients if they're used to taking one medication or one drug in the past.

And then that medication is no longer allowable under medicare's formulary usually if those patients want to be able to get those medications covered by their medicare insurance they do unfortunately need to switch but what you need to know for usmle or comlex or perhaps even in class exams is that medicare part d.

Is drug coverage which is really easy to remember because it's part d d for drugs so for your studying pleasure here are the four parts of medicare we've got part a part b part c part d remember the components of each of them a for inpatient inpatient so that's going to be.

Inpatient hospitalization skilled nursing facilities hospice care and home health care part b for your basic stuff so outpatient visits to the pcp or the specialist labs and preventative care part c is private company care so this is most similar to private insurance it combines.

The elements of the other parts and then part d for prescription drug coverage d for drugs now i understand that this is a little bit overwhelming for you if you've never really understood how medicare works before and by no means am i an insurance expert however it is very important that you understand how.

Insurance works particularly medicare now let's move on and talk about medicaid so medicaid and medicare are very similar sounding names but they differ in some pretty big ways medicaid your eligibility really depends on financial need now there are some exceptions to this but generally.

Speaking medicaid is based on financial need so those with low income will qualify for medicaid as well as those who are disabled children can qualify pregnant women can qualify patients who are on ssi which stands for supplemental security income and then there are additional.

Criteria which differ depending on the state so medicare expansion really happens through the state and not at the federal level so other eligibility is determined on a state-by-state basis now something that's very high yield that i want to include here is what's.

Known as chip children's health insurance program basically what chip does is that let's say that you have a family that makes too much money to qualify for medicaid but even despite that they don't make enough money to really get the child health.

Insurance if the child in the family does not have health insurance that's where chip steps in and ensures that those children are covered so for that reason chip is very closely related to medicaid and usually included within the discussion of what medicaid is.

And who is eligible so if you want to just keep this concept pretty broad i would think of medicaid as being based on financial need and medicare as being generally for those 65 and older obviously there are some exceptions on both sides for medicare and for medicaid but those are your big differences.

Alright moving on let's talk about cobra no dirty i hate snakes no not the cobra alright so cobra stands for consolidated omnibus reconciliation act and this act allows individuals to continue group health insurance policies after they lose their benefits so for example let's say that you are.

Working at a job and as part of your employment benefits you get health insurance if you are let go from the job or you decide to leave or there's any circumstance whatsoever that causes job loss and therefore by extension you lose your health coverage you can activate cobra so cobra lets you.

Continue the group health insurance policy that you had at that previous job and you can continue it up for a certain predetermined amount of time uh it's usually pretty expensive it can be up to 102 percent of the premium and you can continue that coverage so that in that sort of interim phase while.

You're looking for either a new job or new health insurance you're covered so that's what cobra is and again it covers voluntary and involuntary job loss so if you have health insurance you can basically always retain it if you're willing to pay for it and pay the high premium of cobra so as let's do a brief example.

Just to illustrate this let's say that you work at dirty medicine university who knows someday i could have my own medical school you never know but you quit because you think that my videos are stupid but you were getting health insurance from dirty medicine university and then.

You quit and because you quit you no longer are eligible for the group policy that you are getting at dm university um what you could do is activate your cobra plan so cobra this act basically guarantees you if you're willing to pay for it that you will.

Still get the health insurance that was provided to you at dirty medicine university all right so we come back to cobra is there anything else important that you need to know well just for completeness sake i will include that there's always an election period of at least 60 days so you have 60 days to basically decide.

Whether or not you want to elect to pay for cobra and activate your cobra plan and then once activated that plan will last you either for 18 or 36 months period of time so you will be covered until you are able to secure new health insurance now the way to remember this.

Is that i think of the snake the cobra and a cobra snake can extend its body and get disgustingly long and be very scary as it moves in one direction and its tail kind of lags behind so the cobra snake extends its body just like how cobra health insurance works and you can extend the group health insurance policy so.

That's how i remember cobra now that we've talked about medicare medicaid chip and cobra let's just talk about some general insurance principles these are things that may show up that are high yield depending on the class or the exam that you're taking.

So let's start by talking about the different types of insurance payments so our first term is a co-payment or a copay for short a copayment is a fixed fee that must be paid to receive covered care so for example if you have health insurance you can look at your health insurance card.

And it'll tell you what your copay amount is so it's a fixed fee so for example every time you go and you see a specialist so a cardiologist an endocrinologist a gastroenterologist you pay some amount of money at the counter and for example 40 bucks every time you.

See a specialist you pay 40 bucks every time you see a primary care physician you pay 20. so that's a copay it's a fixed fee that has to be paid in order to receive covered care now that's not to be confused with co-insurance now these names obviously sound similar we've got.

Co-payment and co-insurance and the difference here is that co-insurance is a fixed percentage that must be paid by the insured so the co-payment was a fixed amount we said 40 bucks but co-insurance is a fixed percentage so for example if you have health.

Insurance and your co-insurance is 25 and a doctor bills your insurance company for one hundred dollars for a visit you're responsible for twenty five dollars because twenty five percent or one fourth of the one hundred dollar bill is twenty five dollars so.

Co-payment is a fixed fee and co-insurance is a fixed percentage our last term of this general insurance principle is a deductible so the deductible is a fixed amount that must be paid out of pocket before insurance starts to kick in and pay for your care.

So for example if you have a deduct a deductible of four thousand dollars but you haven't met it yet meaning you haven't yet paid four thousand dollars out of your own pocket and your doctor bills you for 265 dollars so literally you go to the doctor's.

Office you have something done and then you get a bill in the mail or online and it's 265 dollars you're responsible for paying all of that 265 dollars because you haven't yet met your out-of-pocket deductible right that's four thousand dollars so you're basically paying 265 dollars this.

Time and then maybe you go back to the doctor for your next appointment and you have to pay 265 dollars again and then maybe you see a different doctor and you pay a hundred dollars over there basically every time you pay those bills they're all adding up and.

You have to pay at least a total combined from all of those bills of your deductible which in this case is four thousand dollars before your insurance will kick in and start to cover your services so in this example you've initially paid 265 out of four thousand toward your deductible and deductibles.

Exist on an individual level so like you personally but if you have a health insurance plan and you've got family members on your plan as well there's also a family deductible so the bottom line here is that the deductible is the amount that must be paid out of pocket before insurance pays for your.

Care sounds pretty evil when we talk about it like this but that's how deductibles work so these are your different types of insurance principles we're talking about co-pays co-insurances and deductibles now let's talk about the different types of insurance plans so when we talk about.

Insurance plans really the four you want to know or what you see in this table i'm going to put it in a table for your studying pleasure we've got health maintenance organizations better known as hmos preferred provider organizations better known as ppos.

Exclusive provider organizations better known as epos and then point of services which are pos all right and as we go through these we'll talk about what what the scope of the providers are that are eligible to be within these plans and then i'll point out some high-yield notes in that last.

Column on the right so for hmos hmos are restricted to a limited panel of physicians so if your health insurance plan is an hmo they're basically telling you if you want to see an endocrinologist you can only go to like one of these 10 people let's say or if you want a primary care doctor you.

Can only go to one of these 20 people i'm simplifying here for the purposes of this discussion but the bottom line here is that within an hmo you are restricted to a limited panel or a limited number of in-network physicians now if you look at the notes column you'll see that it says.

Strict in-network coverage so hmos are very strict you have to see physicians in the limited panel in order for it to be covered and you also need referrals from the primary care physician if you want to see a specialist so that's how hmos work now let's compare that to ppos the.

Preferred provider organization ppos do allow you to see out of network providers but if you do so it's not going to be covered to the same extent within the insurance plan as in network providers so your ppos will designate in-network providers versus.

Out-of-network providers now ppos in general compared to hmos tend to be more expensive but they're a little bit more flexible in the sense that a no referrals are necessary and b you can go out of network so you're not restricted to that limited panel of physicians and sometimes even when you.

Go out of network the insurance will still reimburse you a little bit even if you're seeing an out of network provider so ppos are more flexible but they're more expensive now exclusive provider organizations or epos.

I want you to think of this as basically being the same thing as an hmo but the network just tends to be a lot smaller that's really all you need to take away from this lastly point of service there are out of network providers that are allowed but the designated in-network providers are there to heavily reduce costs.

The major difference between a point of service and a ppo is that in a pos you still need referrals from a primary care physician so really the way to think about a pos is sort of like a hybrid of an hmo and a ppo now i understand that i'm using a lot of acronyms here i'm speaking not slowly so.

Fairly quickly and this is probably a lot of information you've never heard before or at least have not learned in medical school so it's a lot i get it but it's information that you want to know because once you get this down in your brain it's free points on test day and it's.

Also stuff that you probably want to be familiar with especially if you see yourself in the future working in a in a hospital setting so these are different types of insurance plans let's talk now about health care payment models and this stuff does show up this is high yield so you want to know this.

The first thing we're going to talk about is capitation so under capitation physicians receive a set amount of money per patient per period of time regardless of how much the patient utilizes healthcare services so this is really important to understand.

For every patient there's a set dollar amount that the physician receives per period of time and it doesn't matter if the patient goes to the doctor or doesn't go to the doctor capitation is usually used by hmos and it's cap it's calculated based on local costs and average service usage so there's a lot.

Of behind the scenes calculations going on to figure out how much money does the health insurance plan pay in capitation to the physicians or the networks and that's all based on a lot of different metrics so the bottom line here is that this.

Differs regionally the other thing about capitation is that these capitation plans will maintain what's known as a risk pool which is basically like a small percentage of the capitation plan that gets held by the insurance company and only gets paid to the physician if the health if the health plan does well financially.

So it's sort of like a way to hedge against the amount of money that gets paid so for capitation the question is how do you remember this what's the mnemonic so i think of capitation i think of cap like a hat on somebody's head wearing a cap and i think about a bunch of people wearing caps and then each of.

Those caps is a set dollar amount that gets paid in capitation so capitation i think of the caps and then each cap on somebody's head is a set dollar amount so for every patient that that is being that's in a network that uses a capitation model.

Uh it's a per head payment or per cap dollar amount that's how i remember that now let's talk about bundled payments in bundled payments healthcare organizations get a set amount per service which is then divided by all the providers or facilities involved based on the positive health outcome so like if somebody's going into the hospital.

For a hip replacement and let's say that they come in through the emergency room they get an x-ray and then they're admitted to the floor to the orthopedic service and then they're given medications and then they're given some type of orthotic device instead of billing.

Each of these different things separately and getting reimbursed for each of these different things separately the entire amount of services that were rendered gets paid in one bundled payment hence the name and then when the healthcare facility receives the money they then divide.

That by all the various people that were involved in the care again i'm simplifying here so that i can explain this this isn't exactly how this works but this is how you can think about it healthcare organizations that use bundled payments are incentivized to improve.

Patient outcomes because if there's any unexpected healthcare utilization or complications the healthcare facility will basically be paying the cost of that so the bundled payment will only include a set amount per service that's sort of predetermined so for example.

Going back to our discussion about the hip replacement if something goes wrong during the operation and the hip replacement goes poorly maybe the joint becomes necrotic again i'm just making all of this up but any unexpected complication has to be paid for by the healthcare facility because the bundled payment.

Didn't take into account that there might be x y and z complications so that's bundled payments now let's talk about fee for service models so in a fee-for-service model the patient pays for each service individually the the name makes perfect sense here there's a fee and that fee gets paid for each service.

And the thing about fee-for-service models is that this rewards physicians for high volume so the more services that are rendered the more fees that they charge the more fees that the patient has to pay so the patient pays for stuff regardless of clinical outcome in a fee-for-service model.

Now fee-for-service models should not be confused with a discounted fee for service in a discounted fee for service it's basically the same thing as a fee for service but the patient only pays a percentage at a predetermined rate so this is really what's being utilized in ppo plans there's a predetermined rate.

At which a patient will pay a percentage of their care so technically it's fee for service but it's discounted so that's more of what's happening when you think of a traditional private insurance so these are different health care payment models and that concludes this.

Video on general principles of insurance

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