Unit 4.10 - Health Care Benefits

Question 1

What are the managed health care options?

Answer 1

Maximum freedom of choice & minimum cost control
vs.
Minimum freedom of choice and maximum cost control

In order:

• Fee for service (FFS) - max freedom, expensive; employee can choose any healthcare provider they want
• Preferred provider organization (PPS) - agree to lower fees for a greater volume of patients
• Point of service (POS) - primary care physician (gatekeeper) controls costs; requires you to get a referral from your primary care doctor in order to see a specialist
• Health Maintenance Organization (HMO) - co-payment for seeing approved healthcare providers
• Group health cooperatives - another type of HMO, but is a collection of healthcare providers; spread out across an insured population

Question 2

What are Consumer Directed Healthcare Plans?

Answer 2

• Flexible benefit plans (cafeteria plans) - offers employees a choice between various benefits; low medical costs with a high deductible
• Flexible spending arrangements (FSA) - employees set aside money for health expenses pre-tax
• Health Reimbursement Arrangements (HRA) - employer-funded, tax-advantaged health benefit plans used to reimburse out of pocket medical expenses
• Private Health Exchange - provides more options to employees; doctors collaborate; more expensive
• Health Savings Account (HSA) - similar to FSA, but longer term account