COINSURANCE
After you satisfy the Deductible, the benefits for covered services will be provided at the percentage specified on the Schedule of Benefits. The unpaid portion of the PPO Schedule or Allowance (whichever is applicable) constitutes your Coinsurance obligation. Your choice of a Provider will determine the percentage we pay of the PPO Schedule or Allowance (whichever is applicable) and will determine your obligation.
C.A.
Henry has a Major Medical policy with $500 deductible, 80/20 coinsurance, maximum out-of-pocket of $2,000.
Total medical bills = $25,000
Less Deductible 500
Available for coinsurance $24,500
Insured pays 20% 4,900
Less out-of-pocket 2,000
Maximum paid by insured 2,500 (deductible of $500, + OOP of $2,000)
Insurer pays $22,500
MAXIMUM OUT-OF-POCKET COINSURANCE EXPENSE
Again, Please note that these provisions pertain generally to a PPO policy, and the coinsurance provisions are particularly affected by PPO and Non-PPO Providers. For Fee for Service plans, the coinsurance would be more simply described as the percentage payable by the company and the insured after satisfaction of the deductible.
The annual Maximum Out-of-Pocket Coinsurance expense for covered services is the amount specified on the Schedule of Benefits. This is an accumulation of the Coinsurance amount not paid under this Contract for covered services and supplies provided by the following:
• Preferred Patient Providers;
• Suppliers in or out of a Service Area;
• Non-Preferred Patient Provider services for Insureds residing out of a Service Area only; and
• Covered Medical Emergency/Accident Care related services.
When an individual Insured has satisfied (paid out of his/her pocket) the Maximum Individual Out-of-Pocket Coinsurance Expense amount specified on the Schedule of Benefits, we will pay covered services and supplies at 100% of the PPO Schedule or Allowance (whichever is applicable) to be determined by the Provider and Service Area as specified on the Schedule of Benefits.
The Maximum Out-of-Pocket Coinsurance Expense does not include the amount applied toward the Deductible, any benefit reduction, non-covered services, your Coinsurance amount for covered services and supplies for Inpatient and Outpatient Mental and Nervous Disorders and Inpatient Alcohol and Drug Dependency, your Coinsurance amount for covered services of a Non-PPO Hospital or Physician, or charges in excess of the PPO Schedule or Allowance (whichever is applicable). These amounts are your responsibility.
For Fee-for-Service plans in particular, this would vary as all services would be applied to the deductible in most cases. Also, some states may not allow restrictions for Mental and Nervous Disorders, or Alcohol and Drug Dependency.
C.A.
Frances purchased a PPO Major Medical Plan that paid 80% of medical costs after the deductible for participating Providers. For non-participating Providers, it would pay 60% of the approved amount. Frances went to a non-participating doctor for minor surgery.
After the deductible ($1,000) was satisfied, the doctor bill was $3,000. Frances expected to pay 40% of the $3,000 or $1200, as this was a non-participating doctor. However, she received a bill for $1800 and questioned the insurance company.
As with most PPO policies, the insurer will pay 60% of the approved amount. In this case, the approved amount for that procedure was $3,000. Therefore after the deductible, the insurer paid 60% of $2,000, ($1200) which meant that she owed the difference of $800, plus the amount not paid by the insurer ($1,000), for a total of $1800 out-of-pocket. Note: Even though the out-of-pocket under her policy was $1500, this does not normally apply when an out-of-network Provider is used.
RESTORATION OF BENEFITS
The restoration of benefits may be offered, in various forms, and on only certain policy forms. The provisions here are provided only as an example of one type only.
The benefits you have used can be restored. If you receive more than $1,000 in benefits during a Calendar Year, we will automatically restore your lifetime maximum by $1,000 on the next January 1st.
At any time $1,000 or more in benefits has been paid during a Calendar Year, you can restore the full lifetime maximum by sending proof of your good health to us. If we accept your proof, your lifetime maximum will be restored.
Note: Restoration of Benefits does not apply to Alcohol and Drug Dependency, and Mental and Nervous Disorders lifetime maximums.
C.A.
The Horizons Insurance Co. markets a Major Medical plan which includes a Restoration of Benefits provision. The plan has a lifetime maximum of $1,000,000, and the provision states that if more than $5,000 in approved benefits are received in any one calendar year, the benefits will be restored by $5,000.
If a policyholder had medical bills which totaled $12,000, and $2,500 was paid by the insured by deductibles and coinsurance, $9,500 would be received in benefits. This would reduce the lifetime maximum to $990,500. The first of the next year this amount would be increased by $5,000 and the total lifetime maximum would then be $995,500.
MEDICALLY NECESSITY
This Contract does not provide benefits for any service rendered or any supply furnished by a Hospital, Physician, or other Provider which, in the opinion of YOUR INSURANCE COMPANY, is not Medically Necessary, as defined in the general terms section of this Contract. Examples of hospitalization and other health care services and supplies that are not Medically Necessary include, but are not limited to:
• Newborn circumcision.
• Continued hospitalization of the mother because the newborn cannot be discharged, or vice versa.
• Continued hospitalization because arrangements for discharge have not been completed.
• Use of laboratory, x-ray, or other diagnostic testing that has no clear indication, or is not expected to alter the management plan.
• Hospitalization because care in the home is unavailable or unsuitable; or hospitalization for any service which could have been provided safely and adequately in an alternate setting; e.g., a Physician's office or Hospital Outpatient department.
• Hospitalization or admission to a Skilled Nursing Facility for the purpose of custodial care, convalescent care, or any other service primarily for the convenience of the patient and/or his/her family members.
YOUR INSURANCE COMPANY makes the decision whether hospitalization or other health care services or supplies are/were Medically Necessary, and therefore eligible for payment under the terms of your Contract. In some instances, this decision is made by YOUR INSURANCE COMPANY after you have been hospitalized or have received other health care services or supplies and after a claim for payment has been submitted.
In some cases, it is usual for a policy to state a disclaimer which informs the policyholder that if a Doctor or other medical Provider states that certain treatment is “medically necessary” does not automatically make it covered under the policy. Wording may be similar to : The fact that a Provider may prescribe, recommend, approve, or furnish a service or supply does not, of itself, make it Medically Necessary or a covered service; nor does it make the charge an Allowance under this Contract, even though it is not specifically listed as an exclusion.
C.A.
A young mother insured under a Major Medical plan with maternity benefits, delivered her first child prematurely. Although the baby appeared normal in all respects, because it only weighed 4 pounds at birth, the doctor felt that it should stay in an incubator for a brief period of time and until it gained at least 6 more ounces.
The mother was going to breast feed the baby, and became very agitated when she was told that she could be discharged without her baby. Since the attending physician was the family doctor, he kept her in the hospital for an additional 4 days, and at which time both mother and baby were discharged.
The insurance company refused to pay for the hospital charges for the mother’s 4-day stay as it was not medically necessary.
PROVIDER ALTERNATIVES
(This section pertains only to PPO policies and would not be present in a typical Fee-for-Service plan.)
YOUR INSURANCE COMPANY's payment program for covered services varies depending on the health care Provider that the Insured selects to provide the service or supply, as set forth in this section. The level of benefits YOUR INSURANCE COMPANY provides is set forth on the Schedule of Benefits.
YOUR INSURANCE COMPANY does not provide or arrange for the provision of health care services or supplies. It is the Insured's responsibility to select the health care Provider. YOUR INSURANCE COMPANY is not liable for any damages or costs arising from the actions or lack of actions of any health care Provider or such Provider's staff.
IN SERVICE AREA (PPO PLANS ONLY)
Eligible PPO Providers
Eligible PPO Providers are those health care Providers that have entered into an agreement with YOUR INSURANCE COMPANY to participate in YOUR INSURANCE COMPANY's PPO Provider network and were participating in the network at the time the service or supply was provided. Eligible PPO Providers will file claims with YOUR INSURANCE COMPANY on behalf of the Insured. YOUR INSURANCE COMPANY's payment for covered services rendered by a PPO Provider, if any, will always be made directly to the eligible PPO Provider.
YOUR INSURANCE COMPANY's payment for covered services rendered by an eligible PPO Provider will be at the higher Coinsurance percentage of the PPO Schedule amount, as set forth in the Schedule of Benefits. Eligible PPO Providers have agreed to accept the PPO Schedule amount as payment in full for covered services, therefore, the Insured's financial responsibility does not include payment of charges in excess of the PPO Schedule amount. The Insured's financial responsibility includes the Deductible(s) and Coinsurance amounts, the payment of charges for non-covered services, the payment of charges in excess of any maximum benefit limitations, and payment of any benefit reduction. The Insured's Coinsurance responsibility for covered services rendered by an eligible PPO Provider will be based upon the PPO Schedule amount or the eligible PPO Provider's charges, whichever is lower.
A list of the type of Providers that are currently eligible to participate in YOUR INSURANCE COMPANY's PPO Provider network is provided at the back of this document. To determine if a particular health care Provider entered into an agreement with YOUR INSURANCE COMPANY to participate in YOUR INSURANCE COMPANY's PPO Provider network, review the most recent PPO Provider Directory. It is the Insured's responsibility, however, to verify that a health care Provider is a PPO Provider at the time the service or supply is rendered. To verify a Provider's participation status, the Insured may contact the local YOUR INSURANCE COMPANY office or the Provider's office.
C.A.
A PPO schedule is the maximum amount that the insurer will pay for certain medical treatments. Some of the larger insurers are noted for being tough negotiators on the amount. The question arises infrequently as to whether the insured should know the amount that is paid for their treatment. Most patients just don't care, as long as they are satisfied with the treatment. However, an insured may feel that if the insurer doesn’t pay the Providers the “going rate”, then the quality or amount of treatment they receive may be lessened. This has been resolved in different jurisdiction, in different ways. As a practical matter, if the patient is friendly with the doctors staff, they may be able to informally find out, but in some cases the doctors office will not reveal the amount as it is considered confidential and the doctor could have legal headaches if the patient would sue for any reason.
Eligible Non-PPO Providers
Eligible Non-PPO Providers are those health care Providers that have not entered into an agreement with YOUR INSURANCE COMPANY to participate in the PPO Provider network or were not participating in the network at the time the service or supply was provided. YOUR INSURANCE COMPANY's payment for covered services rendered by an eligible Non-PPO Provider, if any, will be at the lower Coinsurance percentage of the PPO Schedule amount, as set forth in the Schedule of Benefits.
The Insured is responsible for filing claims for services and supplies rendered by eligible Non-PPO Providers. YOUR INSURANCE COMPANY's payment, if any, for covered services rendered by an eligible Non-PPO Provider will always be made directly to the Insured.
Typically, on a PPO policy, the payments of medical benefits cannot be assigned to a health Provider that is not an Approved Provider. The insured does not have the contractual or legal authority to have any benefit assignments made to non-Providers. An example of wording in a PPO policy is as follows.
YOUR INSURANCE COMPANY will not honor any assignment to an eligible Non-PPO Provider, including without limitation, any of the following assignments:
• an assignment of the benefits due under this Contract;
• an assignment of the right to receive payments due under this Contract; or
• an assignment of a claim for damages resulting from a breach, or an alleged breach, of this Contract.
The provision explaining the amount for which the applicant is responsible is important to the policyholder and should be explained completely and fully by the agent at the time the application is taken. It was mentioned earlier that if a non-approved Provider is used, the “60%” {used for illustrative purposes} of expenses payable by the insurer {as opposed to the 80% for approved Providers} may actually be substantially more than 60% of the total medical bill. This is explained in more detail in this provision.
Eligible Non-PPO Providers have not agreed to accept YOUR INSURANCE COMPANY's PPO Schedule amount as payment in full for covered services, therefore the Insured is responsible for the difference between YOUR INSURANCE COMPANY's PPO Schedule amount and the eligible Non-PPO Provider's charge, if any, in addition to the Insured's responsibility for the Deductible(s) and Coinsurance amounts, the payment of charges for non-covered services, the payment of charges in excess of any maximum benefit limitations, and payment of any benefit reduction. The Insured's Coinsurance responsibility for covered services rendered by a Non-PPO Provider will be based upon the PPO Schedule amount.
C.A.
George Benson was insured under a PPO plan. He developed cancer of the throat and underwent serious surgery. George was aware of the restrictions of the PPO plan, and was careful to use doctors that were Providers, and the hospital that was a Provider. The hospital, Central Hospital, was considered the best cancer hospital in the area.
George had to have a nurse come to his home for several days to administer medication and to change bandages, etc. These services were covered under his policy. When informed that he would have to have a visiting nurse, his wife asked (George was unable to contribute at this point) what home health care firm to use. The hospital recommended the Central Home Health Care Agency and George's wife made the arrangements with this agency.
After George was at home and after the home health care nurses stopped coming to his house, George started getting small checks from his insurer. They did not know where they came from, and they were small, so they were deposited and forgotten about. About a month later, George received a bill from the Central HHC Agency for $2500. They submitted this bill to the insurer, but they continued to get bills from Central HHC. After getting a call from a collection agency, they contacted the claims department of their insurer.
They were informed that even though the Central HHC agency had the same name as the hospital (Central) they were, in fact, not related. Furthermore, Central HHC Agency was not an
(Continued from previous page) approved Provider for the insurance company. Therefore, they had been receiving checks for 60% of the approved amount, which was much less than that billed by Central HHC, in the form of the small checks they had been depositing.
When appealed, the insurer pointed out that it is the responsibility of the insured to verify that the Provider used for any medical procedure, is a company approved Provider.
OUTSIDE SERVICE AREA
Hospitals located outside of the Service area which have entered into an agreement with YOUR INSURANCE COMPANY in that state will be deemed to be participating Hospitals, and benefits will be paid directly to that Hospital. If the Insured receives covered services in an out of state Hospital, the Insured will be responsible for the payment of any difference between YOUR INSURANCE COMPANY's payment and the Hospital's charge.
C.A.
There are certain hospitals that specialize in a particular medical field and may be referred to a “Centers of Excellence” who contract with insurers outside of their geographical area. In Tampa, Florida, the Moffitt Center is a regional center for cancer treatment. An insurance company in Georgia may have the hospital as a preferred Provider. Therefore, even though the hospital is outside of the service area, it is available for insureds covered under their PPO plan.
C.A.
Bob Bailey purchased a Major Medical PPO policy from his lifelong friend and insurance agent. The agent had offered various types of plans, but Bailey appreciated the advantages of the PPO.
The disadvantages were that he must use the medical Providers approved by the insurer in order to receive the maximum coinsurance allowance. The other principal disadvantage is that when Bailey travels outside of the state, where there are no participating Providers, he cannot use those doctors except for medical emergencies, and receive the maximum coinsurance allowance. Also, when non-PPO Providers are used, the out-of-pocket provision in his policy does not apply. This means that if he is visiting relatives in a state where no approved Providers are available, and he does not feel well, if he goes to a doctor for a checkup, the insurer will only pay 60% of the amount that they normally would pay for the service (not what the doctor charged). Further, if he should become quite ill and was hospitalized, his $2,000 our-or-pocket limitation would not apply. This could amount to thousands of dollars that he may have to pay.
The advantages are that since his family doctor is an approved Provider, he really didn't have to change doctors. The doctor will file all claims for him, eliminating the name for frustrating paperwork. One of the big advantages also is that the doctors have all contracted for their services, and he does not have to worry about what is “usual and customary” and then be accosted with a big bill because the doctor bills more than the insurer is willing to pay.
(Continued from previous page) He will receive full benefits of the policy by using approved Providers, but perhaps the deciding reason to purchase a PPO plan is that the premium is considerably lower than any other type of comprehensive plan.
MEDICAL EMERGENCY/ACCIDENT
As stated earlier, the Medical Emergency and Accident provision states that all benefits will be paid to the Provider or reimbursed on the same basis as those medical services provided by Network Providers. This is applicable only for PPO type policies. Many policies provide for an exception that provides that if an insured receives medical services while traveling outside of the Service area, and if the insured cannot reasonably be expected to return to the Service area, benefits will be provided as if they were a medical emergency or an accident and the higher benefits would be provided.
Payment for a Medical Emergency/Accident is made in accordance with the status of the Provider as follows:
Reimbursement for covered services provided by an eligible PPO Provider will be made at the higher Coinsurance percentage of the PPO Schedule amount as set forth in the Schedule of Benefits.
Reimbursement for covered services provided by an eligible Non-PPO Provider will be made at the higher Coinsurance percentage of the Allowance as set forth in the Schedule of Benefits.
C.A.
Bill Armstrong was insured under a PPO plan whose network was only in his state of residence. While on vacation he suffered severe pains in his side and was rushed to the local hospital emergency room.
The hospital billed his insurance company who, according to the terms of the policy, paid 80% of the charges, even though the hospital and ER doctor were not on the PPO list.
C.A.
The Johnson’s were traveling to the Grand Canyon on vacation. They were insured under a PPO Major Medical plan. En route, Henry suffered severe chest pains and was rushed to the nearest hospital, a small hospital in rural Arizona. Henrys father died of a heart attack, and his mother had also suffered a heart attack recently, so he was keenly aware of the symptoms. He was diagnosed as having Acute Pericarditis caused by a viral infection. While symptoms of a heart attach were present, with some medication and 2 days rest at a Motel, they were able to continue their trip.
His policy agreed to cover a policyholder who required immediate medical attention and if the insured cannot be reasonably expected to return to his own service area. Therefore, his policy would cover his illness, even though it was not a heart attack.
COVERAGE PROVIDED BY OTHER HEALTH CARE PROFESSIONALS
With the growing specialization in the medical field, a provision is common to provide for certain medical services otherwise not covered by the policy. While the CRNA is perhaps the most common, specialists in the psychological and psychiatric fields are growing and perform important functions.
Anesthesia services rendered by a Certified Registered Nurse: Anesthetist (CRNA) may be covered services, subject to the applicable CRNA Allowance. In those instances where the CRNA is actively directed by a Physician other than the Physician who performed the surgical procedure, YOUR INSURANCE COMPANY's payment for covered services, if any, will be made for both the CRNA and the Physician services at the lower directed-services Allowance in accordance with YOUR INSURANCE COMPANY's payment program then in effect.
YOUR INSURANCE COMPANY's reimbursement for covered services rendered at a participating PPO Substance Abuse or Psychiatric Specialty Facility by Physicians, Psychologists, and other Medical Professionals who are employees, independent contractors, or consultants of such Facility who are paid by the Facility to directly perform patient care services, is included in the Allowance for such Facilities.
COVERED INSTITUTIONAL BENEFITS
This section describes benefits for covered services received in a Hospital, Outpatient department of a Hospital, Ambulatory Surgical Center, Skilled Nursing Facility, or the insured’s residence when the insurance company determines that such services are Medically Necessary – note that it is the insurers determination solely. If the policy is a PPO type of plan, the schedule of allowances will apply. The Deductible, Coinsurance and other limitations and exclusions apply to these benefits as well as for other covered medical services.
HOSPITAL EXPENSE BENEFITS
These benefits will vary by company and policy form, but a typical section covering expenses related to a hospital, would be as shown. With some policies, for instance, outpatient care must be covered under a separate rider. Some policies also have limitations on intensive care, etc.
Covered Hospital services include the following:
• room and board (typically a private room will be covered only when isolation is required); intensive care units (including cardiac, progressive care and neonatal care units); use of operating and recovery rooms, including Outpatient surgery; use of emergency room;
• drugs and medicines for your use in a Hospital; intravenous solutions;
• dressings, including ordinary casts;
• anesthetics and their administration by a regularly salaried Hospital employee; respiratory therapy, (example, oxygen);
• transfusion supplies and equipment;
• diagnostic X-rays, ultrasound, and computerized tomography (Cat Scan);
• chemotherapy treatments for proven malignant disease, illness, or Condition if the disease, illness or Condition for which the drug or biological product is being administered is an indication for which the drug or biological product has received approval from the Federal Food and Drug Administration;
• laboratory and pathology services;
• other approved machine testing, (i.e., electrocardiograms (EKG), electroencephalograms (EEG), echocardiography, mammography, etc.);
• Physical Therapy (in connection with a covered Condition); and
• x-ray, cobalt and other acceptable forms of radiation therapy for treatment of proven malignant disease.
C.A.
Adam was admitted to the hospital for prostate surgery. He was put into a semi-private room with a patient who was (in Adams estimation) unusually profane and complaining. Adam is rather religious and modest, and did not appreciate the stream of invectives coming from the other side of the curtain. When his wife came to visit, he was doubly embarrassed, and asked to be transferred to another room. However, the hospital was full as there was a local flu epidemic and even the halls were full. But there was a private room available, which Adam took immediately.
Unfortunately, his insurance policy had a typical clause which stated that a private room in a hospital would only be paid for by the insurer, when isolation is required. Since isolation is not required for prostate surgery, he was responsible for the difference between the semi-private, and the private room rate.
SKILLED NURSING FACILITIES
A Skilled Nursing Facility (SNF) is a facility as described in definitions. It is important to note that generally a Skilled Nursing Facilities requires a Registered Nurse (RN), Licensed Practical Nurse (LPN), or Registered Physical Therapist (RPT) to be on duty 24 hours a day and a Medical Doctor to be on call 24 hours a day. {Some policies require a RN to be on duty 24 hours a day, a typical requirement for Long Term Care policies} One should note that “Custodial Care” as defined in the policy, does not qualify under this policy as Skilled Nursing Facilities. It should also be noted that some policies may not cover SNF’s, so particular attention must be paid before representing such to any applicant.)
Before you enter a Skilled Nursing Facility, your Physician must submit acceptable documentation (a written treatment plan) to YOUR INSURANCE COMPANY which establishes the Medical Necessity for Skilled Nursing Facility services. (This is a cost-containment feature very common in modern Major Medical plans)
If you are admitted to a Skilled Nursing Facility, and the treatment plan has been received and approved by us, benefits will be provided for the services and supplies shown below, up to the Contract maximum number of days specified on the Schedule of Benefits. Covered services include:
• room and board;
• drugs and medicines for your use while in the Skilled Nursing Facility; intravenous solutions;
• dressings, including ordinary casts;
• respiratory therapy, (example, oxygen);
• transfusion supplies and equipment;
• diagnostic x-rays;
• laboratory and pathology services;
• electrocardiograms (EKG) and electroencephalograms (EEG); and Physical Therapy.
Services must be provided or supervised by a licensed RN, LPN, or RPT under the general direction of a Physician.
When a plan of treatment has not been received and approved by us (again, note that the plan must be approved by the insurer), benefits will be denied for Skilled Nursing Facility services. In the event such documentation is provided and the services are found to be Medically Necessary, benefits will be provided.
HOME HEALTH CARE
Some policies have more restrictions on home health care than the one used here as an example. The key point in providing home health care is home confinement in many policies. For example, if a person goes to the grocery store, home health care may be excluded. There usually is consideration given for a person going to a doctor or for other medical treatment.
If you are confined at home and require Home Health Care benefits, we will cover Home Health service when provided by a Home Health Agency. This coverage is limited to the maximum reimbursement specified on the Schedule of Benefits.
For Home Health Services to be covered, each of the following conditions must be met:
• your Physician must send us a home health care plan of treatment; and
• we must approve the plan of treatment; and
• you must be confined to home and be unable to carry out the basic activities of daily living.
We will review your Condition to determine the Medical Necessity of your Home Health Services. If your Condition does not warrant the services provided by a Home Health Agency, benefits will be denied. However, at such time documentation is provided and the services are found to be Medically Necessary, benefits will be extended.
HOME HEALTH SERVICES INCLUDE:
• part-time or intermittent nursing care, by an RN or LPN; the purchase price of drugs and biologicals; Physical Therapy, by a Registered Physical Therapist-, Occupational Therapy, by an Occupational Therapist; Speech Therapy, by a Speech Therapist;
• Home Health Aid Services;
• medical social services;
• nutritional guidance;
• medical supplies; and
• the use of medical appliances.
HOME HEALTH SERVICES DO NOT INCLUDE:
• homemaker services;
• domestic maid services;
• sitter services;
• companion services; services rendered in adult congregate living facilities;
• services rendered in adult foster homes by a person providing general supervision or assistance to three or fewer non-relatives placed in their home by the Department of Health and Rehabilitative Services;
• items or services furnished to an individual by a hospice (i.e. medically coordinated program providing a continuum of home Outpatient and home-like Inpatient care for a terminally ill patient and the patient's family);
• services rendered at an adult day care center; and services rendered by and at a nursing home Facility.
C.A.
Agnes suffered a stroke and upon release from the hospital, was required to take certain medications and a daily evaluation was required by a RN or LPN. She lived alone so a visiting nurse from a home health agency was assigned. Soon afterwards, a physical therapist would be necessary for her to resume the use of her right leg that was the most affected by the stroke.
Agnes’ Major Medical policy provided for home health services, which included services of a RN or LPN, and a Physical Therapist. She was totally confined to her home so she qualified in that respect. As time progressed, the RN would do evaluations and if her services were found to be medically necessary, the stated policy benefits would be extended.
MEDICAL AND SURGICAL BENEFITS
Similar to the Hospital services section above, this section describes the benefits for services covered under this plan, those that are medically necessary, and those provided by a Physician or Medical Professional. All of these benefits are subject to the deductible and coinsurance allowances, and benefit allowances if this is a PPO type plan.
SERVICES PROVIDED OUT OF THE HOSPITAL
A typical provision allows benefits to be paid for such services as those provided by an Ambulatory Surgical Center, when used as an alternative to hospitalization.
This Contract provides benefits for Medically Necessary covered services rendered by a Provider, including an Ambulatory Surgical Center, outside of a Hospital when the service is provided as an alternative to Inpatient treatment in a Hospital.
INPATIENT MEDICAL VISITS
The benefits for medical visits by an attending physician and other physicians are considered separately in this provision. This is not for surgical services.
When you are confined in the Hospital, this Contract covers your attending Physician's charges for care, including critical care.
Benefits are provided for up to one Physician's Visit each day only.
Coverage for Physicians' Visits will not be paid in addition to benefits paid for electroshock therapy. Coverage for all Physicians' Visits is excluded when in connection with surgical procedures. The Physician's fee for a Hospital Visit in connection with his/her surgical procedure, is included in his/her fee for the surgical procedure.
C.A.
Daryl was admitted to the hospital for surgery. His family doctor was his attending physician, and knew that Daryl was an “early bird”, so he scheduled his visits with Daryl as his first stop at the hospital. Since his hospital rounds would usually end in early afternoon, he would stop by and see Daryl on his way out. When the bill was submitted to the insurer, the insurer would only pay for one visit a day by a doctor, which is typical of most Major Medical policies.
ADDITIONAL PHYSICIAN BENEFITS IN HOSPITAL
The coverages provided for physicians other than the attending physician, while the insured is in the hospital, may be separated out as in this illustration, or can be included in one benefits section of the policy. The treatment of other physicians as shown is typical.
During an Inpatient Hospital stay, you may receive services by more than one Physician. We will provide benefit payment to more than one Physician only if your Condition:
• involves more than one body system; and
• is so severe or complex that one Physician cannot provide your care unassisted; and In addition, the Physician must:
• have different specialties or have the same specialty with different sub-specialties; and actively participate in your treatment.
SURGICAL SERVICES
Some policies cover all surgical services and procedures in one provision. It should be noted that if complications arise, under this illustrated provision, there would be no separate reimbursement. Sort of “You broke it, you fix it” type of provision.
This Contract covers surgery needed to diagnose or treat a Condition, when performed by a Physician acting within the scope of his or her license. Complications, if they occur within 72 hours of the surgical procedure, are not separately reimbursed.
SIMULTANEOUS SURGICAL PROCEDURES
When more than one surgical procedure is performed, most policies treat them as shown in the following provision.
Multiple Surgical Procedures
Multiple surgical procedures are more than one surgical procedure performed on different areas of the body during the same operative session by the same Physician. When the attending surgeon performs more than one procedure during a single operative session, benefits will be provided at the PPO Schedule or Allowance (whichever is applicable), for the primary surgical procedure. Additional procedures will be reimbursed at 50% of the PPO Schedule or Allowance (whichever is applicable).
INCIDENTAL SURGICAL PROCEDURES
Some policies include this provision and the one proceeding into one provision. The difference is that the Incidental Surgery is performed through the same incision.
Incidental surgical procedures are multiple (more than one) surgical procedures which are performed through the same incision. If the surgical procedures are not clearly identified or do not add significant time or complexity to the surgical session, these procedures are considered to be incidental to the major surgical procedure. Incidental surgical procedures are covered services but no separate reimbursement will be made for these procedures. The Allowance for an incidental procedure will be included in the PPO Schedule or Allowance (whichever is applicable) for the major surgical procedure.
C.A.
An example of an incidental surgical procedure is the removal of an appendix during the same operative session in which a hysterectomy is performed. The Allowance for the removal of the appendix is included in the PPO Schedule or Allowance (whichever is applicable) for the hysterectomy. No additional benefit will be extended for the removal of the appendix.
PHYSICIAN SURGICAL ASSISTANT
Benefits for surgical assistants are usually a percentage of the surgical allowance (if PPO) or of the amount paid to the surgeon under the “Usual and Customary”, etc., provision. The following provision is a PPO situation, as are most of the provisions as explained earlier.
This Contract provides benefits for the services of a Physician who acts as a surgical assistant provided:
• the assistance is Medically Necessary; and
• no intern, resident, or other staff Physician is available.
The reimbursement level for such surgical assistant is 20% of the Physician's surgical Allowance. Benefits will be paid at the percentage of the PPO Schedule, or Allowance (whichever is applicable), specified on the Schedule of Benefits.
ANESTHESIA
Typically, the policy provides for anesthesia to be administered by a physician. Policies may provide for anesthesia to be administered by a CRNA (nurse anesthetist). Please note that this provision may appear conflicting with the previous section on the administration of anesthesia while in the hospital, but actually there is no conflict as this section concerns only Physicians services.
This Contract provides benefits for general anesthesia services when administered by a Physician, other than the operating Physician or his or her partner or associate, for covered surgical procedures.
C.A.
When Ann was undergoing at hysterectomy, she used the hospitals Anesthesiologist. Her Major Medical policy covers benefits for general anesthesia when administered by a physician other than the operating physician
CONSULTATIONS
Second opinions are used in most cases where applicable because not only of the need for additional assistance, but also because of the fear of malpractice suits. Most policies do pay for the second opinion but under certain conditions, similar to those contained in the following example.
Your Physician may request an Inpatient or Outpatient consultation concerning your Condition.
This Contract provides benefits for consultation services only if:
• your attending Physician requests the consultation; and
• the consulting Physician includes a written report in your Hospital record or provides your Physician with a written report.
Only one consultation from one consulting Physician will be covered per Condition.
C.A.
Maurie was always a pessimist, and when he was diagnosed as requiring immediate surgery, he demanded a second opinion after he was admitted to the hospital. The doctor considered his symptoms as “classic” and could not see the need for a second opinion as the surgery, while important, was relatively simple and one that he had performed hundreds of times without problems.
Maurie then personally called another doctor that was recommended by his brother-in-law, who confirmed the original doctors diagnosis and advised Maurie to have the surgery.
Since the attending physician had not requested a second opinion, the insurance company would not pay for a second doctor.
OUTPATIENT VISITS
This is a provision that seems to state the obvious but is legally necessary. It is included in other provisions in many types of policies.
This Contract covers your Physician's or Medical Professional's Medically Necessary services for Outpatient Visits in connection with a Condition or covered Well Child Services.
DIAGNOSTIC SERVICES
Diagnostic services are frequently treated separately as coverages of these services vary by policy and by company. They can also become quite expensive if a limit is not placed on these services.
This Contract provides benefits for the following diagnostic services, when performed by a Physician, to diagnose or treat a Condition.
• x-rays, ultrasound, and computerized tomography (CAT Scan);
• laboratory;
• pathology;
• approved machine testing, (i.e., electrocardiograms (EKG), electroencephalograms (EEG); and
• allergy testing, by any method. Our Allowance for allergy testing is based on the type and number of tests performed by the same Physician.
THERAPEUTIC SERVICES
This Contract provides benefits for the following therapeutic services when Medically Necessary.
• Physical Therapy (in connection with a covered Condition)
• Chemotherapy treatments for proven malignant disease, illness, or Condition if the disease, illness or Condition for which the drug or biological product is being administered is an indication for which the drug or biological product has received approval from the Federal Food and Drug Administration.
• X-ray, cobalt and other acceptable forms of radiation therapy for treatment of proven malignant disease.
• Electroshock therapy services will be provided when rendered by a Physician. Payment of benefits for electroshock therapy is made in lieu of payment for any other medical services rendered on the same day electroshock therapy treatments are given by the Physician providing the medical services.
• Allergy therapy is the treatment of allergies by the administration of antigens. Our Allowance of the antigens is based on the type and number of doses per vial.
MAMMOGRAM SCREENING SERVICES
As discussed elsewhere, mammogram screening varies by state and by type of policy. The following is a typical mammogram screening provision.
Mammogram Screening Services
The following mammogram-screening services are covered services when
furnished to an Insured and will not be subject to the Calendar Year Deductible and Coinsurance requirements of the Contract.
1. A baseline mammogram for any woman who is 35 years of age or older, but younger than 40
years of age;
2. A mammogram every two years for any woman who is 40 years of age or older, but younger
than 50 years of age, or more frequently based upon a Physician's recommendation;
3. A mammogram every year for any woman who is 50 years of age or older; or
4. One or more mammograms a year, based upon a Physician's recommendation, for any woman
who is at risk for breast cancer because of a personal or family history of breast cancer,
because of having a history of biopsy-proven benign breast disease, because of having a
mother, sister, or daughter who has had breast cancer, or because a woman has not given
birth before age 30.
Except for mammograms done more frequently than every two years for women 40 years of age or older, but younger than 50 years of age, benefits are payable when, with or without a prescription from a Physician, the Insured obtains a mammogram in a medical office, medical treatment facility or through a health testing service that uses radiological equipment registered with the Department of Health and Rehabilitative Services for breast-cancer screening.
C.A.
Many Major Medical policies now cover mammograms for females over age 35 and increasing by age, the number of mammograms approved each year. However many states now allow mammograms when ordered by a physician, regardless of age. Some policies make mammograms subject to deductibles and coinsurance, some waive the deductibles, and some policies waive both the deductible and the coinsurance.
OTHER COVERED BENEFITS
For illustrative services, additional benefits are covered under a separate provision. These additional benefits are those that do not fit into one of the above categories, for instance, services and supplies which combine benefits from institutional and medical/surgical benefit, but are medically necessary. They are all subject to the usual deductibles, coinsurance allowances, PPO schedules, etc. Since these are repetitive, they are not listed but include Medical Emergency, Accident Care, Mental and Nervous Disorders, and Alcohol and Drug Dependency treatments.
COMPLICATIONS OF PREGNANCY
Complications of pregnancy and maternity benefits have been discussed earlier. The coverages are, in almost all cases, shown separately as there have been many misunderstandings on this provision, and it can be an extremely costly provision. On those plans that provide maternity benefits, there may or may not be a provision specifically addressing complications of pregnancy. The following example provision assumes that there is no maternity coverage provided under the policy.
This Contract provides benefits for all Insureds for Complications of Pregnancy on the same basis as for any other Condition.
By Complications of Pregnancy, we mean a Condition diagnosed as separate from the pregnancy. Complications include, but are not limited to, the following:
• acute nephritis;
• nephrosis;
• cardiac decompensation;
• missed abortion;
• therapeutic abortion;
• non-elective Cesarean section;
• tubal pregnancy which is terminated;
• miscarriages; or
• medical and surgical Conditions of similar severity.
Complications of Pregnancy do not include:
• false labor;
• occasional spotting;
• bed rest prescribed by a Physician;
• morning sickness;
• uncontrolled vomiting;
• convulsions and high blood pressure; or
• similar conditions associated with a difficult pregnancy.
NOTE: This Contract does not provide maternity benefits for a normal delivery.
C.A.
Melissa is covered under a Major Medical plan that does not cover maternity benefits for a normal delivery.
When she became pregnant with her first child, she had a rather difficult time as she was bothered by occasional spotting and morning sickness. Her doctor made her stay in bed for the last 3 weeks of pregnancy. At the time of delivery, it was determined that she must have a Cesarean section to deliver the baby.
When the claims were filed with the insurance company for the problems of pregnancy, such as spotting and morning sickness, and` her ultimate bed rest, were denied. However, the services for the Cesarean section were paid under the policy, and are considered as complications of pregnancy.
STERILIZATION
This provision may be included with other coverages in some policies, but for illustrative purposes the following provision is shown.
This Contract provides benefits for tubal legations, when performed independently of any other surgical procedure, and vasectomies.
NEWBORN CARE AND TRANSPORTATION
Provisions for the care and treatment of newborn children are addressed separately to avoid misunderstanding, and again because of its potential cost.
This Contract provides benefits for the newborn of an Insured from the moment of birth for any Condition. This coverage includes, but is not limited to, the following:
• congenital defects;
• birth abnormalities; and
• prematurity.
This Contract provides benefits for the transportation of a covered Newborn Insured to the nearest Hospital appropriately staffed and equipped to treat the child's Condition. The attending Physician as needed to protect the child’s health and safety must certify the need for transportation.
NOTE: A child born to a covered family member, other than the Contract Holder or the Contract Holder's spouse, is covered from the moment of birth for any Condition and Well Child Care Services up through 18 months only. The length of time may vary by company, policy or jurisdiction.
C.A.
Even though the birth may be normal and there are no complications of pregnancy, if the baby suffers abnormalities at birth, the baby is covered and the resulting medical costs will be covered under most Major Medical policies.
In addition, even though the policy does not cover normal delivery, if the baby is born prematurely and must spend time in the nursery incubator, they are covered from birth and most policies will cover the medical care.
WELL CHILD CARE
Well-child care, also known as Well-baby care, varies by policy and company, but in many states, are standardized and closely follow the following illustration.
Health care services and supplies furnished to an Insured who is a dependent child which are Physician-delivered or Physician-supervised may be covered services. Such services include:
• Newborn's first examination in the Hospital. The examination must be provided and billed by a Physician other than the delivering obstetrician or anesthesiologist.
• periodic examinations, which include a history, physical examinations, developmental assessment and anticipatory guidance necessary to monitor the normal growth and development of a child;
• oral and/or in actionable immunizations; and laboratory tests normally performed for a well child.
These services must conform with prevailing medical standards and will be limited to 18 Visits during a 16 year period at the following age intervals:
birth 15 months 6 years
2 months 18 months 8 years
4 months 2 years 1 0 years
6 months 3 years 12 years
9 months 4 years 14 years
12 months 5 years 16 years
These benefits will be limited to one visit per age interval and will not be subject to the Calendar Year Deductible, but will be paid at the Coinsurance percentage of the allowed amount specified in the Schedule of Benefits. Additionally, the Calendar Year Deductible will not apply to the Newborn's initial Hospital admission. To be eligible for payment of benefits, the services must be received within 90 days prior to or after the date the child reaches the age interval specified.
NOTE: A child born to a covered family member other than the Contract Holder or the Contract Holder's spouse, is covered from the moment of birth for any Well Child Care Services, up through 18 months only.
C.A.
Roy's family Major Medical policy provides well-child benefits. His unmarried dependent daughter, age 19, delivers a healthy baby. The initial checkup at the hospital by the family pediatrician would be covered, but not if performed by the obstetrician. Well-child checkups and shots would continue according to a schedule until the baby is typically 18 months old, at which time these services cease since the mother is not the insured under the policy. This provision is typical of many Major Medical plans, but in some policies and in some jurisdictions this does not appear and the baby would get full well-child benefits.
Typically, the well-child benefits are the waiving of the deductibles, but in most cases, the mother is still responsible for the coinsurance percentage.
AMBULANCE SERVICES
Ambulance service is covered similarly to that shown below, in most policies and in most states.
This Contract provides benefits for Medically Necessary Ambulance service when needed to transport you from:
• a Hospital to the nearest Hospital or Skilled Nursing Facility that can provide proper care; or
• a Hospital to your nearest home only when Ambulance service is Medically Necessary; or
• your home or place of a Medical Emergency/Accident to the nearest Hospital that can provide proper care.
Transportation by water, airplane or helicopter will be paid at the PPO Schedule for a ground vehicle unless:
• the pick-up point is inaccessible by a land vehicle; or additional speed is critical; or
• the distance involved in getting the patient to the nearest Hospital with appropriate facilities is too far for medical safety, as determined by YOUR INSURANCE COMPANY.
C.A.
Sam was in a severe auto accident 35 miles from the nearest hospital. Para-medics were summoned and it was determined that it was imperative that Sam be admitted to the hospital immediately. They radioed for the hospital helicopter ambulance, who took Sam to the hospital. It was conceded that this action probably saved Sam from paralysis and possibly death. The policy provisions of his Major Medical plan allowed benefits if speed was critical, which was the situation here.
PRESCRIPTION DRUGS
Prescription drugs are usually covered while in the hospital, and in many states, for diabetics. The limitations shown below are typical of these provisions.
Prescription Drugs prescribed for an Insured by a Physician and dispensed by a Pharmacist may be covered services. The benefits for Prescription Drugs are subject to, in addition to all of the other provisions of this Contract, the following limitations:
• a maximum quantity of a 31-day supply or 100 dosage units, whichever is greater, per Prescription;
• authorized refills must be filled within one year from the original Prescription date;
• insulin is limited to a two vial (10 ml. each) supply, per Prescription; and
• disposable syringes when prescribed with a supply of insulin, limited to a one month supply or 100 units, whichever is greater, per Prescription.
PROSTHETIC DEVICES
The following provisions provide coverage for prosthetic devices, orthotic devices, and durable medical equipment. These provisions are quite typical.
This Contract provides benefits to purchase, fit, adjust, repair or replace Prosthetic Devices, including the initial prosthetic device following a covered mastectomy.
This Contract does not provide benefits for dental appliances or for the replacement of cataract lenses. However, we will provide the replacement of cataract lenses if a prescription change is Medically Necessary.
C.A.
Myrtle’s right leg was amputated as the result of an accident. Her Major Medical policy covered Medically Necessary Prosthetic Devices, so she was fitted for an artificial leg and went through rehabilitation. Later, another operation on the leg was necessary making it necessary to change the artificial leg.
Myrtle was a young single lady, and her appearance was very important to her. She discovered that she could get one of the newest engineered artificial legs that would look much more normal than the one she had before. However, the more realistic model cost over $500 more than one similar to what she had before, and that worked perfectly well.
Unfortunately the policy had a limitation which stated they would cover the most cost-effective device which would do the job. Therefore, Myrtle would be responsible for the purchase of the more expensive leg, or the difference in cost if the prosthetic company would work with her.
ORTHOTIC DEVICES
This Contract provides benefits to purchase, fit, adjust, repair or replace Orthotic Devices. This benefit does not include coverage for arch supplies or orthopedic shoes.
DURABLE MEDICAL EQUIPMENT
Durable Medical Equipment includes wheelchairs, crutches, hospital-type beds, and oxygen equipment, but does not include special devices for the operation or utilization of a motor vehicle (i.e., lift), hot tubs or Jacuzzis.
This Contract provides benefits for Durable Medical Equipment, when each of the following conditions are met:
• the equipment must be prescribed by a Physician; and
• the item is not useful to the patient in the absence of a Condition; and
• the equipment does not, in whole or in part, serve as a comfort or convenience item.
Our Allowance for Durable Medical Equipment is based on the lowest of the following:
• the purchase price; or
• the lease/purchase price; or
• the rental rate. The total amount of rent must not exceed the total purchase price.
Also, we cover the repair or replacement of parts needed for the effective operation of the equipment if you own or are purchasing the equipment.
C.A.
Joseph was injured in an auto accident and after release from the hospital, was confined to a wheelchair. Joseph will probably spend the majority of the coming year in the wheelchair. His insurance company determined that it was less expensive to purchase the wheelchair than to lease it. This fully met the requirements of durable medical equipment as provided under his policy.
Joseph purchased a van so that he could travel more comfortably. He is a large man, so it was difficult for him to propel himself into the van, and it was impossible for his wife to push him into the van. Therefore, he had a special wheelchair lift installed on the side of the van so that he could enter the van in his wheelchair. His policy contained a typical provision that excluded any special devices for the operation or utilization of a motor vehicle. They would not pay for the wheelchair lift device.
SERVICES OUTSIDE OF THE UNITED STATES
Policies should be carefully studied as to whether any medical services received outside of the United States are covered, and if so, under what circumstances.
This Contract provides for Medically Necessary covered services you receive while you are traveling outside the United States. Services received outside the United States which are Experimental or Investigational, in the opinion of YOUR INSURANCE COMPANY, will not be covered.
TRANSPLANT SERVICES AND SUPPLIES
These illustrative provisions are specific as to transplant services and supplies. These may vary widely by policy, company and state regulations.
Transplant includes pre-transplant, transplant and post-discharge services, and treatment of complications after transplantation. YOUR INSURANCE COMPANY will pay benefits only for services, care and treatment received or in connection with a:
1. Bone Marrow Transplant, as defined herein, and which may be specifically listed in the
appropriate state regulations or insurance codes, or which may be covered by Medicare as
described by publications by the Health Care Financing Administration (also see the
Definition of a Bone Marrow Transplant as shown in GENERAL TERMS);
2. corneal transplant;
3. heart transplant;
4. heart-lung combination transplant;
5. liver transplant;
6. kidney transplant;
7. pancreas transplant performed simultaneously with a kidney transplant; and
8. lung-whole single or whole bilateral transplant.
In order to ensure that a proposed transplant is covered the Insured or the Insured's physician should notify YOUR INSURANCE COMPANY in advance of the Insured's initial evaluation for the procedure. Corneal transplants do not require prior benefit determination.
YOUR INSURANCE COMPANY's Medical Affairs Department will make a prior benefit determination concerning the proposed transplant, however, YOUR INSURANCE COMPANY must be given the opportunity to evaluate the clinical results of the Insured's initial evaluation for the transplant as well as any applicable protocols. If YOUR INSURANCE COMPANY is not given an opportunity to make the prior benefit determination, the transplant may be subject to a reduction in payment in accordance with the rules set forth in the Admission Certification section, if applicable. Once coverage for the transplant is predetermined, YOUR INSURANCE COMPANY's Medical Affairs Department will advise the Insured or the Insured's Physician of the coverage decision.
For covered transplants, and all related complications, YOUR INSURANCE COMPANY will cover:
1 . Hospital expenses and Physician's expenses provided that such services will be paid in accordance with the same terms and conditions for care and treatment of any other covered Condition.
2. Organ acquisition and donor costs. Donor costs are not payable if they are covered in whole or in part by any other insurance carrier, organization or person other than the donor's family or estate.
No benefit is payable for or in connection with a transplant if:
1 . The transplant is excluded.
2. The expense relates to the transplantation of any non-human organ or tissue.
3. The expense relates to the donation or acquisition of an organ or tissue to a recipient who is not covered by YOUR INSURANCE COMPANY.
The following services/supplies/expenses are also not covered: Artificial heart devices used as a bridge to transplant.
Insureds may call the Customer Service Assistance toll free number indicated on their identification card in order to determine which Bone Marrow Transplants are covered under this Endorsement.
C.A.
Paul went to the hospital for kidney stone surgery. Pre-surgery tests indicated that there was mass on one of his kidneys, which tests proved to be cancerous. Later tests indicated that the other kidney had also been so affected. The doctors determined that he must either have kidney transplant, or spend a lifetime as a kidney dialysis patient. Paul was only 45 years old, in otherwise excellent health, with no apparent mental or physical disorders. He was considered as an excellent candidate for a kidney transplant.
Paul's brother was found to be a perfect match for a replacement and agreed to the transplant. However, his brother had been out of work for some time and had lost his health insurance.
Typically, Paul's Major Medical policy will cover the cost of the transplant, including reasonable costs for the acquisition from a donor, so his brother should occur no, or very small, medical costs.
COST CONTAINMENT PROGRAMS
“Cost Containment” programs, as used in this provision cited here, is a form of Managed Care, and is very prevalent in the health insurance industry today. There is so much misunderstanding of Managed Care and how it operates, that a provision such as this is very much in order. Some policies may not have these types of programs, or may not address them separately. For those that do, the following wording is typical.
Any and all decisions made by YOUR INSURANCE COMPANY in administering these programs are made only to determine the benefits, if any, for covered services under this Contract. Any and all decisions that pertain to the medical care provided to an Insured or the setting in which the medical care is provided, are made solely by the Insured and the Insured's health care Provider in accordance with the normal patient/health care Provider relationship. YOUR INSURANCE COMPANY in no way participates in or overrides such medical decisions, but merely determines the level of payment, if any, for the medical care under this Contract.
All requests for forms, certifications, and certification reviews must be directed to the Utilization Management Department of YOUR INSURANCE COMPANY.
NOTE: Notwithstanding the cost containment programs described herein, YOUR INSURANCE COMPANY reserves the right to deny claims for services and supplies at any time during the claims review process. Any YOUR INSURANCE COMPANY determination that an admission is certified does not mean that services and supplies rendered during the admission are covered services payable under this Contract, but merely means that the Hospital setting is appropriate for rendering those services and supplies. YOUR INSURANCE COMPANY makes all claims payment decisions retrospectively during the claims review process.
ADMISSION CERTIFICATION
Fee-for-Service plans would treat this subject differently, as the need for PPO hospitals would not be present. Rarely does a major medical policy not have some provision for pre-admittance requirements.
Admission Certification means certification must be received from YOUR INSURANCE COMPANY to receive full Contract benefits for ALL Inpatient Hospital Admissions (i.e., elective, planned, emergency and maternity) to PPO Hospitals.
The Admission Certification program requirements for admissions to PPO Hospitals are the PPO Provider's sole responsibility, therefore, the Insured is not responsible for satisfying such requirements or for any potential benefit reductions when the Insured is admitted to a PPO Hospital.
Once YOUR INSURANCE COMPANY has received the necessary medical information, YOUR INSURANCE COMPANY will review the information and make a certification decision based upon the Admission Certification program's established clinical criteria then in effect.
For Admissions to PPO Hospitals which are not certified, payment to the PPO Hospital will be reduced by the amount specified in that PPO Hospital's Contract with YOUR INSURANCE COMPANY .
Any and all decisions made by YOUR INSURANCE COMPANY in administering this program are made only to determine the appropriateness of care and/or the appropriateness of setting for that care delivered to the Insured for purposes of payment under this Contract.
Certification must be received from YOUR INSURANCE COMPANY to receive full Contract benefits for elective and/or Planned Inpatient Admissions to any Hospital by PPO Physicians.
The Admission Certification program requirements for elective and/or Planned Admissions by PPO Physicians are the PPO Physician's sole responsibility; therefore, the Insured is not responsible for satisfying such requirements or for any potential benefit reductions when the Insured is admitted by a PPO Physician.
C.A.
Sid's Major Medical PPO policy listed Dr. Smith and the Manfield General Hospital as approved Providers. When Sid needed hospitalization, Dr. Smith filled out some preliminary papers for certification to the Manfield General. The Insurer required additional information which was not sent by Dr. Smith. Therefore, the insurer would not pay for all of the medical services provided by the hospital, and such shortages were billed to Sid. The insurance company intervened and stated that according to the contract` with the PPO Providers, and according to the policy provisions, any benefit reductions that were caused by the action of the PPO Provider, is not the responsibility of the insured. The doctor and the hospital therefore, worked out an agreement for payment of these expenses.
Assume that Sid's admission request was refused by the insurance company and that the operation was for a hemorrhoidectomy. In many cases this could be performed in the doctors office. However Sid suffered from a nervous condition that would require him to be under anesthesia for some time after an operation, and which therefore should properly be performed in a hospital. Further, Sid had a pacemaker and was on heart medication, such facts not reported to the insurer. Therefore, an appeal was made to the insurance company. The Insurance Company reviewed the additional information and approved the admission.
Because of Sid's condition, Sid wanted to stay an additional two or three days in the hospital to make sure that his nervous condition or his heart condition, did not cause additional health problems. The Insurance Company was monitoring his condition under the Concurrent Review provisions of his policy, and they notified Sid and his doctor, that if Sid would stay in the hospital, his benefits would be denied for the additional days. However, if he would go to the doctors office daily, they would cover the doctors office visits, etc.
APPEALS PROCESS
It is rare that there are conflicts between a physician and the insurance company regarding admission to hospitals, however there must be a provision for appeal in case there are conflicts. A sample of such provision wording appears below.
The Insured and the PPO Provider have the right to appeal the Admission Certification decision. Appeal requests must be submitted to YOUR INSURANCE COMPANY, in writing, within 90 days of receipt of decision notice. A request for review should include any additional information pertinent to the admission and/or medical services in question.
The Utilization Management Department will review the appeal to determine if the admission met the objective criteria. If the criteria were met, the admission will be certified. If there is no additional information which would allow the admission to be certified, the initial decision will be upheld.
INPATIENT CONCURRENT REVIEW
“Concurrent Review” is a Managed Care concept which monitors the appropriateness of an individual remaining in the hospital. These may or may not be implemented and administered at any time that the insured is on an in-patient basis.
Concurrent Review of an Inpatient admission may be initiated by YOUR INSURANCE COMPANY to monitor the appropriateness of continued hospitalization. Using pre-established review criteria, Concurrent Review of the Hospital stay may occur at regular intervals. In those instances where YOUR INSURANCE COMPANY administers the program, YOUR INSURANCE COMPANY will provide the Insured's Physician with notification when YOUR INSURANCE COMPANY's criteria under this program for payment for continued Inpatient care is no longer met. For Hospital days which are not certified, the Insured has two options:
The Insured may continue with the Hospital stay, however, payment will be denied for those days determined by YOUR INSURANCE COMPANY not to be Medically Necessary; or
The Insured may elect Outpatient treatment, in which case, Contract benefits for Medically Necessary Outpatient care will be provided.
The process to appeal a Concurrent Review decision is the same as the Appeal Process for Admission Certification.
DISCHARGE PLANNING
Discharge planning is another Managed Care technique and provides for benefits once a person has been discharged from the hospital. The purpose is to assist in reducing unnecessary hospital stays by planning for treatment when discharged at the earliest possible date.
Discharge Planning is a program which identifies an Insured's potential need for health care treatment following hospitalization. YOUR INSURANCE COMPANY will use established criteria to identify potential need for services or supplies following discharge from the Hospital. When potential discharge planning services or supplies are identified, YOUR INSURANCE COMPANY will contact the Insured, the Physician and the Hospital.
YOUR INSURANCE COMPANY will also assist in the discharge planning process by helping to identify, for the Insured's Physician and Hospital, alternative services available within the Insured's community which provide health care services or supplies following hospitalization. Additionally, if the Insured's Physician or Hospital has questions regarding overall benefit coverage for services after discharge, YOUR INSURANCE COMPANY will provide this information.
CASE MANAGEMENT PROGRAM
Case Management is one of the foundations of Managed Care, but is voluntary, as described below. This is a popular provision on most Major Medical policies.
The Case Management program is a voluntary service which emphasizes individual case attention. It is designed to review Hospital admissions with particular emphasis on catastrophic or chronic illnesses and/or injuries. This review process helps to determine if an alternative setting for recovery may be appropriate or if coordination of services could avert future Medically Necessary admissions.
YOUR INSURANCE COMPANY may elect to offer alternative benefits through its voluntary Individual Benefits Management program for cost-effective services and supplies not otherwise specified as covered under this Contract. Alternative benefits may be made available on a case-by-case basis to individual Insureds. All eligibility decisions will be made solely by YOUR INSURANCE COMPANY. Such alternative benefits, if offered, will be offered in accordance with an alternative treatment plan with which the Insured, or the lnsured's representative, and the lnsured's Physician concur in writing.
Offering to provide or the providing of alternative benefits in one instance shall not obligate YOUR INSURANCE COMPANY to provide the same or similar benefits to the Insured, or to any other Insured, in another instance. Nothing herein shall be deemed a waiver of YOUR INSURANCE COMPANY's right to enforce this Contract in strict accordance with its express terms and conditions, and all provisions in this Contract, except those specifically changed under this program, continue to apply.
NOTE: Regardless of the cost containment programs described above, the insurance company still reserves the right to deny claims for services and supplies at any time during the claims review process. Also, the insurance company does not waive its right to enforce the terms of the Contract (e.g., the exclusions) by administering these programs. For example, if an admission is certified under the Admission Certification program, the insurance company will deny claims for non-medically necessary services or supplies rendered during that admission.