Page 149 - An Indispensible Resource for Being a Credible Activist

Managed care plans—Managed care plans generally provide comprehensive health care.
Examples of managed care plans include:
● Health maintenance companies (HMOs)
● Preferred provider companies (PPOs)
● Exclusive provider companies (EPOs)
● Point-of-service plans (POSs)
Managed care provisions—Features within health plans that provide insurers with a way
to manage the cost, use, and quality of health care services received by group members.
Examples of managed care provisions include:
● Preadmission certification—An authorization for hospital admission given by a
health care provider to a group member prior to their hospitalization. Failure to obtain
a preadmission certification in non-emergency situations reduces or eliminates the
health care provider’s obligation to pay for services rendered.
● Utilization review—The process of reviewing the appropriateness and quality of care
provided to patients. Utilization review may take place before, during, or after the
services are rendered.
● Preadmission testing—A requirement designed to encourage patients to obtain neces-
sary diagnostic services on an outpatient basis prior to non-emergency hospital admis-
sion. The testing is designed to reduce the length of a hospital stay.
● Non-emergency weekend admission restriction—A requirement that imposes limits
on reimbursement to patients for non-emergency weekend hospital admissions.
● Second surgical opinion—A cost-management strategy that encourages or requires
patients to obtain the opinion of another doctor after a physician has recommended
that a non-emergency or elective surgery be performed. Programs may be voluntary
or mandatory in that reimbursement is reduced or denied if the participant does not
obtain the second opinion. Plans usually require that such opinions be obtained from
board-certified specialists with no personal or financial interest in the outcome.
Maximum out-of-pocket expense—The maximum dollar amount a group member is
required to pay out of pocket during a year. Until this maximum is met, the plan and
group member shares in the cost of covered expenses. After the maximum is reached,
the insurance carrier pays all covered expenses, often up to a lifetime maximum. (See
“Maximum plan dollar limit.”)
Maximum plan dollar limit—The maximum amount payable by the insurer for covered
expenses for the insured and each covered dependent while covered under the health
plan. Plans can have a yearly and/or a lifetime maximum dollar limit. The most typi-
cal of maximums is a lifetime amount of $1 million per individual.
Medical savings accounts (MSA)—Savings accounts designated for out-of-pocket medical
expenses. In an MSA, employers and individuals are allowed to contribute to a savings
account on a pre-tax basis and carry over the unused funds at the end of the year. One
major difference between a Flexible Spending Account (FSA) and a Medical Savings
Account (MSA) is the ability under an MSA to carry over the unused funds for use in a
future year, instead of losing unused funds at the end of the year. Most MSAs allow

132 The H R Toolkit