HRA Plans and Health Care System for the Smith Family Paper If the Smiths had been enrolled in the HRA plans in 2019 how much would the Smith’s have paid o | Course Hero

HRA Plans and Health Care System for the Smith Family Paper If the Smiths had been enrolled in the HRA plans in 2019 how much would the Smith’s have paid out of pocket, and how much would the insurance have paid? Assume that they had no other medical costs for 2019. Clearly list any assumptions that you need to make. PLEASE SEE THE ATTACHMENTS T FOR MORE DETAILS. Question 1
The Tradition plan:
Traditional plans may require you to meet a deductable. A deductible is the amount
you must pay each year before the health plan will reimburse you for any of your
healthcare expenses. After you have met your deductable, you may be required to pay
a percentage of any healthcare expenses for you or your family.
– The deductible start to pay for the services for participating providers $750 for the
person and $1500 for the family.
– The deductible start to pay for the services for non-participating providers $1500 for
the person and $3000 for the family.
HRA plan:
The HRA is an employer-sponsored plan that can be used to reimburse a portion of
you and your eligible family member’s out-of-pocket medical expenses, such as
deductibles, coinsurance and pharmacy expenses. It is not an insurance program, but a
financial reimbursement plan funded entirely by your employer. Your employer has
designated a specific dollar amount to credit to the account (either monthly or annual
contributions).
– The deductible start to pay for the services for participating providers $1500 for the
person and $3000 for the family.
– The deductible start to pay for the services for non-participating providers $3000 for
the person and $6000 for the family.
The difference between both is that the HRA plan is more expensive than the
traditional plan.
The insurance company structured that way to motivate insured people to go to the
participating providers which they have the contract and have discount. On other hand
the non-participating provider which have a higher costs related to their quality and
services.
Question 2
If Smith had been enrolled in one of the two plans in 2014 Smith family would paid
out of pocket $6000, and the insurance company have to paid the %80 of the medical
bill. Both plans provide that the covered person would pay the %20 and the insurance
company will pay the %80 of the medical costs. The injury that Smith faced and the
fee of services in Nashville will covered by the insurance company.
Month of February : medical services for Scott
The hospital bill for the 3 days network provider
$18800
Physician charge while in hospital
$1625
Eight office visit to physicians
$910
Physical therapy( six sessions)
$1720
Home health visit
$660
Generic prescription
$14
Antibiotic (Brand Name)
$144
Over counter medical supplies
$58
Total costs
$23.931
Table 1:
Patient pays Traditional Plan
Deductibles
Co pays
Coinsurance
Total costs
Patient out of pocket limit
Patient pays
Total costs will be paid pay insurance
The total Bill Services
$750
$448
$913
$2111
$2250
$4361
$19570
$23.931
Patient pays HRA Plan
Deductibles
Co pays
Coinsurance
Total costs
Patient out of pocket limit
Patient pays
Total costs will be paid pay insurance
The total Bill Services
$1500
$40
$1041
$2523
$1500
$4081
$19850
$23.931
-The hospital bill for the 3 days network provider ($18800). Patient will pay the
deductable which ($750) and the out of pocket which will be ($2250). So the total will
be paid by the patient in this Bill $750 + $2250 = $3000 with this Bill the insurance
will pay the rest of amount which will be ($15800). While in HRA plan the
deductable will be $1500 and out of pocket will be $1500 and the patient will be
within the plan the total of $ $3000 and the insurance will cover the total of $15800.
– Physician charge while in hospital ($1625). Patient will pay only the coinsurance
which will be 20% of the total Bill. It will be ($325) paid by the patient and the rest of
the bill will be paid by the insurance company which will be ($1300). While the HRA
plan will cover the same amount.
-Eight office visit to physicians ($910). Patient in this bill will pay the co pay which
will be $200 and the coinsurance which will be the 20% that will be $142. So the
patient will pay the total of $342 and the insurance will pay the total of $568. While
the HRA plane no co pay and the patient will pay 20% which $182 and the insurance
will paid the 80% which $728.
– Physical therapy( six sessions) ($1720). Patient will pay the co pay which will be
$150 and the coinsurance will be $314 and the total will be $464 paid by the patient
and the insurance will paid $1256. While the HRA plan patient will paid the 20%
which will be $344 and the insurance will paid the 80% which cover $1376.
– Home health visit ($660). 20% of this bill will paid by the patient $132, and the rest
of bill which will be the 80% of the bill will be paid by the insurance $528. While the
HRA plan paid the same coverage.
– Generic prescription ($14). The co pay will be $10 paid by the patient and the rest
will be paid by the insurance which will be $4. While the HRA plan paid the same
coverage.
– Antibiotic (Brand Name) ($144). The patient will paid only the co pay which will be
the $30 and the rest will be paid by the insurance which will be $114. While the HRA
plan paid the same coverage.
From this I can assume that the HRA plan is better since it is cheaper than Traditional
plan related to the data the show above. Even the deductable is more than the
traditional.
Table 2:
Month of September : medical services for Ben
Surgeon charge
$1945
Outpatient surgery center and lab charge
$1450
Pathologist charge
$375
Total costs out of network provider
$3770
Patient pays Traditional Plan
Deductibles
Coinsurance
Total costs Paid by patient
Total costs will be paid pay insurance
The total Bill Services
$750
$1208
$1958
$1812
$3770
Patient pays HRA Plan
Deductibles
Coinsurance
Total costs Paid by patient
Total costs will be paid pay insurance
The total Bill Services
$1500
$908
$2408
$1362
$3770
– Surgeon charge, Outpatient surgery center and lab charge, and Pathologist
charge In this bill the patient will paid $750 as deductable and will paid 20%
as coinsurance which will be $1208 the total will be $1958. While in HRA
plan the deductible will be $1500 and the coinsurance $908 and the total will
be paid by the patient $2408.
From this situation I can assume that the traditional plan is better since it is cheaper
than HRA plan related to the data the show above. Because of the deductable more
than the traditional. I believe that because of the out of net work provider which
higher the total costs.
Table 3:
Month of May : medical services for Amy
Routine checkup and mammogram office visit
$98
lab
$90
Mammogram
$145
Total costs will be paid by Plan
$333
Under both plans it will be covered and the patient will not pay anything in this bill.
Table 4:
Medical services for Ellen
104 speech sessions in 2014
$110
Total costs
$11440
Patient pays Traditional Plan
Deductibles
Coinsurance
Total costs Paid by patient
Total costs will be paid pay insurance
The total Bill Services
$750
$2138
$2888
$8552
$11440
Patient pays HRA Plan
Deductibles
Coinsurance
Total costs Paid by patient
Total costs will be paid pay insurance
The total Bill Services
$1500
$1988
$3488
$7952
$11440
-104 speech sessions in 2014 ($110 each). The patient will paid the deductable which
will be $750 and the coinsurance $2138 and the total will be $2888. While the HRA
plan the deductable will be $1500 and the coinsurance will be $1988 and the total will
be $3488.
From this situation I can assume that the traditional plan is better since it is cheaper
than HRA plan related to the data the show above. Because of the deductable more
than the traditional.
For the family plan:
Patient pays Traditional Plan
Deductibles
Co pays
Coinsurance
Patient out of pocket limit
The Total Paid by Patient
$750 + $750
$448
$913 + $1208
$2250 + $333 + $770
$7422
Patient pays HRA Plan
Deductibles
Co pays
Coinsurance
Patient out of pocket limit
The Total Paid by Patient
$1500 + $1500
$40
$1041 + $908
$1500 + $333 + $770
$7592
Over all I assume both plan the Traditional and the HRA plan have difference in
deductable and both have the same coinsurance in network provider and out of net
provider, and there is some difference in co pay with both. And I assume that the
Traditional plane cheaper than the HRA plan.
In the Traditional monthly premium single will be $201.93 and family $624.18 and
with HRA plan single will pay monthly $148.03 and family $452.97. That show the
HRA plan cheaper than the Traditional plan.
Question 3
what factors I would tell the Smiths to consider in choosing a plan. The first factor
that they should consider in financial stability and the strength of the covering in
medical care and what type of illness will be covered. Second factor that the wide of
the network provider hospital, physician, or pharmacy which will gave a Smiths
many option to choose from it. The last factor that the ability to access to the health
care and the way to communicate with insurance company. From choosing health care
plan the employees should choose the one cover their needs not the plan that cover
things that they don’t suffering from it. And looking for the plan which over more
benefit like the dental care and vision care. In order to avoid expensive plans.
Employee should choose the plan which take more risk in the insurance side not from
patient side.
Surname1
Name:
Course:
Institution:
Date:
Health Care System for the Smith Family
The Smith family is faced by a decision between the Traditional Coverage Plan and the HRA
Plan Coverage Plan. It is important to investigate the healthcare needs of the family in order to
advice on which insurance plan from Meritain they should take up. Picking the best plan is
important as it ensures that the healthcare bills of the family are covered by the insurance plan.
Failure to choose the best plan would mean that some of their needs are not covered by the plan,
and certain benefits would evade the family. Families should ascertain the most optimal plan to
ensure that healthcare is promoted among all the members of the family.
In evaluating which plan the family should choose, one must consider the costs that could
have been incurred under the two plans (Kongstvedt). First, we consider the costs that were
incurred by Scott when he fell from a ladder while working at home. The costs included a
hospital bill for the three days he spent in hospital, physician charges while in hospital and office
visits to physicians. Other costs incurred include the home visits, therapy and drugs. The below
table shows the amounts that the family would have to pay under each of the plans after the
accident he had at home.
TRADITIONAL PLAN
Hospital bill for 3 days in Deaconess Hospital, Evansville
Physician charges while in the hospital
Eight office visits to physicians
18,800
1,625
910
Surname2
Physical therapy (six sessions)
Home health, four visits
Generic Prescription pain reliever, list price at pharmacy
Antibiotic (Brand Name), list price at pharmacy
Over the Counter Medical Supplies (bandages etc.)
Total due to Providers
PATIENT PAYS
Deductibles
Co-insurance
1,720
660
14
144
58
23,931
750
4,786
5,536
HRA PLAN
Hospital bill for 3 days in Deaconess Hospital, Evansville
Physician charges while in the hospital
Eight office visits to physicians
Physical therapy (six sessions)
Home health, four visits
Generic Prescription pain reliever, list price at pharmacy
Antibiotic (Brand Name), list price at pharmacy
Over the Counter Medical Supplies (bandages etc.)
18,800
1,625
910
1,720
660
14
144
58
Total due to Providers
23,931
PATIENT PAYS
Deductibles
Co-insurance
1,500
4,786
6,286
From the above, the Traditional Plan is better since it is cheaper than the
HRA Plan
In the second scenario, Smith took Ben to a surgeon in Nashville. He wanted a small growth to
be removed from his neck, and it was an outpatient service.
Charges Incurred
Surgeon $ 1,945
Surname3
Lab Charge $ 1,450
Pathologist Charge $ 375
Under the Traditional Plan, the Smith family would pay 20% of the total cost for an outpatient
surgery plus the deduction of $ 750.
Traditional Plan
Surgeon
Lab Charge
Pathologist Charge
Total Cost
1,945
1,450
375
3,770
Co-insurance
Deductibles
Cost to the Family
754
750
1,504
Under the HRA Plan, the Smith family would have to pay 20% of the outpatient surgery cost
plus the deductible of $ 1,500 for each family member.
HRA Plan
Surgeon
Lab Charge
Pathologist Charge
Total Cost
1,945
1,450
375
3,770
Co-insurance
Deductibles
Cost to the Family
754
1,500
2,254
The third scenario was in May. Amy, Scott’s wife went to for a checkup. The check up
was a routine one. The office visit was $98, lab was $90, and the mammogram was $145. The
total cost for all the services provided is $ 333. Under the Traditional Plan, Amy would have to
pay 25% of the total amount that is $83.25. Under the HRA Plan, Amy would have to pay 20%
of the whole amount, and that is $ 66.6. In this scenario, it is more expensive to use the
Traditional Plan insurance scheme.
Surname4
The fourth scenario involves Ellen, who has an articulation problem. She needs speech
therapy as recommended by a speech pathologist. The pathologists have recommended that she
should attend sessions with them twice weekly for the next year. These are $110 per session.
There are fifty-two weeks in a calendar year, and that will signify that she will attend one
hundred and four sessions the whole of next year.
Amount Payable
Cost per Session
110
Number of Sessions
104
Total Cost
11,440
Cost under the Traditional Plan
25% of the total Cost for the whole year
2,860
Cost under the HRA Plan
20% of the total Cost for the whole year
2,288
In this scenario, it is cheaper to undertake the HRA Plan since it is cheaper compared to
the Traditional Plan. In arriving at the most optimal medical scheme for the family, one should
assess which plan among the two is cheaper and covers all the needs of the family. The most
important thing about insurance is that it should cover all the risks that the family is exposed to
since different families face different risks.
The coverage of the risks of the family is similar under the two plans, and it can be said
that the two plans fully cover their risks. The overall price that would be charged under the two
plans, however is different. The Traditional Plan is cheaper for the four scenarios given in this
case. My advice to the Smith family is to choose the Traditional Plan Medical Scheme.
Surname5
I made a few assumptions at arriving at the advice given above. First, I assumed that
Ellen will attend all the therapy sessions at the pathologist’s office next year. The therapies will
be due twice weekly for the fifty-two weeks in the year. Another assumption was that when Scott
took Ben to Tennessee, the hospital that he was treated in was an accredited hospital by the
insurance firm that is offering the plans to them. Policy takers should ensure that the doctors and
hospitals they visit are under the network of the provider of the plans.
Another factor that they should consider includes the health benefits that are available in
the plans. Such benefits could include prescriptions, dental care and vision care. In order to avoid
expensive plans, clients should choose plans that cover their needs and not choosing a plan that
covers needs that the family does not require (Stevens). For example, a situation where you
choose a plan that covers terminal illnesses whereas none of the family members suffers from
any terminal illness. If any of the family members has a special need, always ensure you choose
a plan that covers those needs.
Another factor that should be considered by the Smith family is that their favorite
physicians are included by the insurance firm. Having medical services offered outside the
network means that the family would have to foot such bills since they are not covered by the
insurance firm (Green).
Surname6
Works Cited
Green, Michelle. Understanding Health Insurance: A Guide to Billing and Reimbursement. New
York: Delmar Cengage Learning, 2010.
Kongstvedt, Peter R. Essentials of Managed Health Care. Burlington, MA: Jones & Bartlett
Learning, 2012.
Stevens, William S. Health Insurance: Current Issues and Background. New York: Nova
Science Publishers, 2013.
The Smith Family and Their Health Care Decisions
Background
Amy Smith is 37 years old and married to Scott, age 41. They live in Henderson County,
Kentucky with their three children, Troy, age 16; Ben, age 13; and Ellen, age 4. Amy has just
accepted a job at the University of Evansville. Amy’s previous place of employment she was
enrolled in a catastrophic type plan that covered only major problems and had a very high
deductible. Essentially, Amy would collect only if a member of her family had a major medical
problem. Although she could convert to a private policy, it was apparent without any analysis
that she needed to select the UE HRA plan. Scott is self-employed, so the family depends on
Amy’s plan.
Like so many people today, Amy and Scott are confused about health care and insurance. Amy
knows that you have studied health services administration at the University of Evansville, and
she and Scott come to you for advice. They have a shoebox full of receipts and insurance
statements. Amy usually tracks the financial records for the family and she tells you that she
can’t keep up with all the paperwork, and isn’t sure if the insurance is paying for what it should.
The Facts
From a health care standpoint, 2019 was a rough year for the Smith family. While driving to
work on an icy morning last February, Scott’s car was hit by a snowplow. Scott had multiple
injuries, including a broken leg and facial lacerations. Here is some information about Scott’s
medical services and bills:
Ambulance Services (ground transportation) = $1200
Hospital bill for 2 days in Henderson County, Kentucky (In network) = $18,800
Physician charges while in hospital = $2,525
Six office visits to physicians = $970
Generic Prescription pain reliever, list price at pharmacy = $37
Antibiotic (Brand Name), list price at pharmacy = $139
Over the Counter Medical Supplies (bandages etc.) = $158
In September the Smiths took Ben to a pediatric surgeon in Nashville to have a small growth
removed from his neck. This was performed as an outpatient. Because Scott and Amy weren’t
sure of the seriousness of the growth, they wanted the best care possible, and decided to travel to
Tennessee. The surgeon charged $1035, and the outpatient surgery center and lab charged $890.
The pathologist charged $275. One week after the surgery, Ben returned for a follow-up office
visit, which cost $145. All of these charges are at out-of-network facilities for all UE plans.
In May 2019 Amy went to Deaconess Clinic for a routine checkup and mammogram. Amy notes
that her longtime physician participates in the UE network. The office visit was $126, lab was
$90, and the mammogram was $185.
Ellen has an articulation problem and needs speech therapy. At age 4 she needs extensive
treatment. Ellen had seven sessions in 2019. Two different speech pathologists have
recommended that Ellen attend sessions twice weekly for the next year. These are $105 per
session. Other than the above, the family considers themselves healthy.
Questions to Consider:
If the Smiths had been enrolled in the HRA plans in 2019 how much would the Smith’s have paid
out of pocket, and how much would the insurance have paid? Assume that they had no other
medical costs for 2019. Clearly list any assumptions that you need to make.
Summary of Benefits and Coverage: What this Plan Covers & What You Pay For Covered Services
05/31/2021 University of Evansville Group Health Plan Active Employees: HRA Plan
Coverage Period: 06/01/2020 –
Coverage for: Single + Family | Plan Type: PPO
The Summary of Benefits and Coverage (SBC) document will help you choose a health plan. The SBC shows you how you and the
plan would share the cost for covered health care services. NOTE: Information about the cost of this plan (called the premium) will be
provided separately. This is only a summary. Fo…
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