Just as being without insurance does not necessarily preclude care, participating in an insurance plan does not guarantee that the plan will pay for the specific services wanted, needed, or received by those the plan insures. Health plans vary in the services they cover, and even for covered services, other restrictions, such as requirements for prior approval of hospitalization, may apply (IOM, 1989). In addition to limiting costs, the objectives of such requirements may be to improve quality of care by reducing departures from those clinical practices associated with better outcomes, to reduce patient care for which risks exceed probable benefits, or to limit exposure to iatrogenic (care-induced) illness.
Health plan restrictions that may particularly affect people with advanced illness come in many forms. These include
- limiting the scope or level of benefits to restrict costs and encourage economical choices by consumers. Some services may be excluded altogether; for example, Medicare excludes payment for most outpatient prescription medications. In addition, plans may require patients to pay part of the cost of a service (in the form of deductibles, copayments, or coinsurance), cover a limited number of visits or days of care, or set a cap on the dollar amount of payments for selected or all services during a defined time period. Some plans (including Medicare) set no upper limit on beneficiary liability for cost-sharing.
- creating financial incentives for practitioners and providers to provide less care. Plans may establish a fixed payment per day, per case, or per capita regardless of the amount of service rendered. Some health plans are paid by employers, governments, or others on a capitated (per member per month) basis, but they may pay practitioners and providers on a fee-for-service, per case, or other basis, or they may combine partial capitation with other payments.
- requiring that patient services be authorized in advance. Many health plans insist that special personnel review hospital admissions, medical procedures, and certain other services. They may also require that a designated primary care physician authorize referrals to specialists.
- creating protocols or other tools to govern care. Plans may adopt written statements that define what services are to be provided for particular medical problems, what medications are covered (e.g., formularies), and otherwise direct care to varying degrees.
- establishing productivity standards or appointment schedules. Such schedules may limit the time physicians can spend in evaluating patients, identifying problems and concerns (such as depression or persistent pain), and discussing care options.
- covering services only if provided by designated physicians and other health care providers or applying higher cost sharing requirements if