Objective [1]
Explain why the costs of health insurance and health care
have been increasing.
Health care costs, except during 1994-1996, have gone up
faster than the rate of inflation. Among the reasons for high and
rising health care costs are the use of expensive technologies,
duplication of tests and sometimes technologies, increases in the
variety and frequency of treatments, unnecessary tests, the increasing
number and longevity of elderly people, regulations
that shift rather than reduce costs, the increasing number of accidents
and crimes requiring emergency services, limited competition
and restrictive work rules in the health care delivery
system, rapid earnings growth among health care professionals,
built-in inflation in the health care delivery system, and other
factors.
Objective [2]
Define health insurance and disability income insurance and
explain their importance in financial planning.
Health insurance is protection that provides payment of benefits
for a covered sickness or injury. Disability income insurance protects
a person's most valuable asset: the ability to earn income.
Health insurance and disability income insurance are two
protections against economic losses due to illness, accident, or
disability. Both protections should be a part of your overall insurance
program to safeguard your family's economic security.
Disability can cause even greater financial problems than
death. In fact, disability is often called "the living death." Disabled
persons lose their earning power while continuing to incur normal
family expenses. In addition, they often face huge expenses for
the medical treatment and special care their disabilities require.
Objective [3]
Recognize the need for disability income insurance.
Disability income insurance provides regular cash income lost
by employees as the result of an accident, illness, or pregnancy.
Sources of disability income insurance include the employer,
Social Security, worker's compensation, the Veterans Administration,
the federal and state governments, unions, and private
insurance.
Objective [4]
Analyze the benefits and limitations of the various types of
health care coverage.
Five basic types of health insurance are available under group
and individual policies: hospital expense insurance, surgical expense
insurance, physician's expense insurance, major medical
expense insurance, and comprehensive major medical insurance.
The benefits and limitations of each policy differ. Ideally,
you should get a basic plan and a major medical supplementary
plan, or a comprehensive major medical policy that combines
the values of both of these plans in a single policy.
Major provisions of a health insurance policy include eligibility
requirements, assigned benefits, inside limits, copayment,
service benefits, benefit limits, exclusions and limitation, coordination
of benefits, guaranteed renewability, and cancellation
and termination.
Objective [5]
Evaluate private sources of health insurance and health
care.
Health insurance and health care are available from private insurance
companies, hospital and medical service plans such as
Blue Cross/Blue Shield, health maintenance organizations
(HMOs), preferred provider organizations (PPOs), exclusive
provider organizations (EPOs), point-of-service plans (POSs),
home health care agencies, and employer self-funded health
plans.
Objective [6]
Appraise the sources of government health care programs.
The federal and state governments offer health coverage in accordance
with laws that define the premiums and benefits. Two
well-known government health programs are Medicare and
Medicaid.
