HS215 Unit 2 Insurance Plan Comparison Example

Five Arrangements, Seven Front-Desk Questions: A Unit 2 Insurance Plan Comparison From Indemnity to Medicaid

[Student Name]

Purdue University Global

HS215: Medical Insurance and Billing

Unit 2 Insurance Plan Comparison

[Instructor Name]

[Date]

The descriptions are general and the dollar figures illustrative; the textbook, survey and federal sources cited are real.

The Seven Questions

1. Who issued the card, and who is the subscriber?

2. Which providers are covered: any provider, or only a network?

3. Is a referral or prior authorization needed?

4. What does the patient pay at the time of service?

5. Is there a deductible, and how does coinsurance work?

6. Who receives the claim, and who pays the provider?

7. What is the most common registration mistake with this arrangement?

Traditional Indemnity Policy

1. Issued by a private insurer, often to an individual or through an older employer plan.

2. Any licensed provider may be used; there is no network.

3. Referrals are generally not required.

4. Patients often pay the provider and seek reimbursement, or pay a share after the claim.

5. A deductible applies, followed by coinsurance, often 20 percent, on the insurer's usual and customary amount.

6. The claim may be filed by the provider or the patient; payment may go to either.

7. Common mistake: assuming the full charge is covered, when the plan pays only on its allowed amount and the patient owes the difference (Smith, 2022).

Health Maintenance Organization (HMO)

1. Issued by a managed care organization, usually through an employer or a marketplace plan.

2. Care is covered only within the HMO's network, except emergencies.

3. A primary care provider usually coordinates care, and referrals are required for most specialists.

4. A fixed copay at check-in is typical.

5. Deductibles are often low or absent; copays dominate.

6. The provider files with the HMO, which pays its contracted rate.

7. Common mistake: seeing a specialist without a referral on file, which leads to denial.

Preferred Provider Organization (PPO)

1. Issued by a private insurer, commonly through employers.

2. In-network and out-of-network care are both covered, at different levels.

3. Referrals are usually not needed; prior authorization may apply to some services.

4. Copays for office visits are common.

5. A deductible and coinsurance apply, higher out of network.

6. The provider files with the PPO; out-of-network providers may bill the patient for the balance above the allowed amount.

7. Common mistake: failing to warn a patient that the provider is out of network.

Medicare

1. Issued by the federal government to people 65 and older and certain younger people with disabilities or end-stage kidney disease; Medicare Advantage plans are issued by private insurers under contract.

2. Original Medicare covers any provider that accepts Medicare; Advantage plans often use networks.

3. Original Medicare does not require referrals; many Advantage plans do.

4. Original Medicare generally collects nothing at check-in except where a deductible or coinsurance is known; Advantage plans often use copays.

5. Part B has an annual deductible and then 20 percent coinsurance on most services (Centers for Medicare & Medicaid Services [CMS], 2024).

6. Claims go to a Medicare administrative contractor or to the Advantage plan.

7. Common mistake: billing Original Medicare when the patient has switched to an Advantage plan, or the reverse.

Medicaid

1. Issued by a state program, often through a managed care plan, to people who meet income and other eligibility rules.

2. Care is covered by providers enrolled in the state program or the plan's network.

3. Managed care plans often require referrals and prior authorizations.

4. Copays are low or absent, and limited by federal rules.

5. Deductibles are generally not used.

6. Claims go to the state or its managed care plan.

7. Common mistake: not checking eligibility at each visit, since eligibility can change month to month.

The registration questions do not change from card to card; what changes are the answers, and a front desk that asks all seven every time catches most problems before a claim is ever sent.

When a Patient Has More Than One

Some patients carry two of these arrangements at once: a working adult with both an employer PPO and a spouse's plan, or a person with Medicare and Medicaid together. The front desk must then decide which plan pays first, the primary, and which pays second. Rules for this coordination of benefits vary by arrangement; for example, Medicaid is almost always the payer of last resort, paying only after other coverage. Recording both cards and asking which is primary at every registration prevents claims from going to the wrong payer first.

Why the Comparison Matters at Registration

Registration staff do not need to memorize every detail of every plan. They need to recognize which arrangement a card represents and know which of the seven questions are most likely to cause trouble for that arrangement. A referral question matters most for an HMO; an out-of-network warning matters most for a PPO; a monthly eligibility check matters most for Medicaid. The comparison is useful because it turns plan types into a short list of priorities for each card.

Patterns Across the Five

Managed arrangements, HMOs, many Medicaid plans and Medicare Advantage, shift control of care toward networks and referrals, which makes registration and authorization the main sources of error. Arrangements with deductibles shift cost toward patients, which makes estimating and collecting the patient's share the main challenge. Employer coverage increasingly combines both, as high-deductible plans with networks have spread (KFF, 2024).

References

Centers for Medicare & Medicaid Services. (2024). Medicare & you 2025: The official U.S. government Medicare handbook. U.S. Department of Health and Human Services.

KFF. (2024). 2024 employer health benefits survey. KFF.

Smith, L. M. (2022). Fordney's medical insurance and billing (16th ed.). Elsevier.