Method of Payments - Assignment Example

RUNNING HEAD: METHODS OF PAYMENT A payment for coverage of healthcare is paid through various sources that is; individuals paying out of their pocket, health insurance provided by private sector or funds and public insurance programs. The categories will be widely described belowPrivate These are payment made by employers or individuals for healthcare premiums and in turn cover for the cost of payment to various health plans like; Health Maintenance Organizations (HMOs) which are done by paying fixed prepayment by individuals who become members of the organization.

Preferred Provider Organization (PPOs): This organization concentrates on indemnity insurance. Point-of-service (POS) plans provides flexibility and addresses the shortcomings of HMOs approach According to the Kaiser Family Foundation and the Health Research and Educational Trust (2009) that this type of insurance cover are differentiated and they include cost sharing utilization paperwork and restrictions. It is clear that the tradeoffs lead to difficulties in controlling costs but can still afford quality services for those who are able to manage do so by limiting their utilization.

Pay (No insurance) It is evident that there has been an increase in uninsured especially by racial factor.25% of families who were below poverty level are missing out on insurance either because of unemployment or work in industries that do not provide for them health insurance cover. It has become a national health concern therefore governments provided the Affordable Care Act so as to protect those who are unable to secure health insurance Medicaid It is known to be the second largest health insurance provider in the US.

It covers for ‘Medically indigent’ that is funded by the state and the federal governments. The federal government provides health services like X-ray services, in and out patient care, lab services and home healthcare. Authority is at the administration in each state with eligibility of requirements and services There is differentiation in benefits in different nationalities. For example some countries provide a wider benefit in the dental sector others provide mental health benefits and variation in coverage for the poor (2009) .

Some states cover for individuals with higher income and others for individuals mandated by the federal government. These differences results to ‘welfare magnets’ meaning individuals earning less move to states that favor them. The disparities are related to how Medicaid is financed. In most cases the federal government finances 55%-70% 0f the costs of Medicaid in any state depending on the poverty status Medicaid has gained its stability in various ways; policy changes due to expansion of eligibility requirements, rehabilitation, dental care, mental health care and many others.

Increasing rate of unemployment increase poverty and uninsured leading to growth in spending Medicare This federal program mainly deals with providing health care to the permanently disabled younger adults, the elderly that is over 65years, those who are suffering from the end-stage renal diseases (ESRD) and those who have been seriously ill for at least six months of their lifetime. The benefits of this program are;Hospital insurance that is provision of inpatient skilled nursing facility (SNF) covering 100days reserve, inpatient hospital coverage benefit that qualify for home health care for seriously ill (Spencer, 2011).

Supplemental medical insurance (SMI) provides coverage for outpatient care, preventive services and visits to physicians (Laiser, 2011). The Prescription Drug Benefit provides coverage of drug through Medicare approved prescription plans. Medicare finances are done in three different ways .The first is through employer employee contribution of a certain percentage of the payroll. Secondly is from the federal taxes. Thirdly is by cost sharing from the beneficiaries, premiums, balance billing and coinsurance.

The public policies have a great concern with rise in expenditures and growth in enrollment (Terry, 2010). Expenditure distribution is determined by the dollar percentage allocated in the various sectors of health. The number is also indicated by aging population with the increasing life expectancy and services provided. These factors don’t tell exactly how there has been a drastic growth in expenditure According to the CMS data it is reported that due to the shift in treatment of chronic illness to healthcare expenditures increases as the society ages.

Secondly there has been a tremendous growth in pharmaceutical expenses and technological innovations in the field of medicine. Thirdly is the payment to providers of rural health providers and malpractice premium in relation to the increasing litigationChildren’s Health Insurance Program (CHIP)Establishment of CHIP was formed for provision of health coverage to the low-income children under the Medicaid. ReferencesKaiser Family Foundation and the Health Research and Educational Trust (KFFHRET). (2009) Health insurance in American systems.

London: Rutledge publicationsLaiser, Tom. (2011) Making it happen: Streamlining the health insurance factor. Oxford: Oxford University pressSpencer, Henry. (2011) Why America is still sick: The health insurance mistakes and opportunities. New York: Prentice hall pressTerry, Christine. (2010) America’s Medicare and Medicaid. Chicago: Riverside publication