Health Insuring Corporations (HICs)

Unlock the world of Health Insuring Corporations (HICs) – your key to comprehensive healthcare coverage. Navigate the intricate landscape of insurance protection, discover services, and stay informed on trends. Trust HICs for a healthier, more secure future. Explore now!

General Characteristics

Health Insuring Corporations (HICs) provide benefits in the form of services rather than in the form of reimbursement for the services of a physician or hospital. HICs seek to identify medical problems early by providing preventive care. They encourage early treatment and, whenever possible, provide care on an outpatient basis rather than admitting the member into the hospital.

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1. Combined Health Care Delivery and Financing

The HIC provides benefits in the form of services rather than in the form of reimbursement for the services of the physician or hospital. Traditionally, the insurance companies provide the financing, while the doctors and hospitals have provided the care. HICs serve a dual function: provide health care services and manage financing.

2. Limited Service Area

The HIC offers services to those living within specific geographic boundaries, such as county lines or city limits. If individuals live, or sometimes work, within the service area, they are eligible to belong to the HIC.

3. Limited Choice of Providers

The HIC tries to limit costs by only providing care from physicians and hospitals that meet their standards and are willing to provide care at a prenegotiated price. Whenever possible, HCI enrollees will use the services of a provider network; however, if the services are not available through the network, the member can receive a referral to a physician or a hospital out of network.

4. Gatekeeper Concept

Once first enrolled, an HIC member chooses a primary care physician or gatekeeper. If the member needs to see a specialist, the gatekeeper must refer the member. This helps keep the member away from the higher priced specialists unless it is truly necessary.

5. Primary Care Physician vs. Referral Physician

When an individual becomes a member of the HIC, he or she will choose a primary care physician (PCP), who will serve as a gatekeeper. The primary care physician will be regularly compensated for being responsible for the care of that member, whether care is provided or not. It should be in the primary care physician’s best interest to keep this member healthy to prevent future time for treatment of disease.

In order for the member to get to see a specialist, the PCP must refer the member. In many HICs, there is a financial cost to the primary care physician for referring a patient to the more expensive specialist, thus the primary care physician may be inclined to use an alternative treatment before approving a referral.

6. Copayments

A copayment is a flat dollar amount, or out-of-pocket expense, that must be paid by the member directly to the service provider. For example, the member may be required to pay $10 for each office visit.

7. Prepaid Basis

HMOs operate on a capitated basis, which means they receives a flat amount each month attributed to each member, whether they see a physician or not. In essence, it is a prepaid medical plan. As a member of the plan, you will receive all services necessary from the member physicians and hospitals.

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HIC Services

1. Basic Health Services

Basic services is defined as those services that are medically necessary and include

  • Physician’s services, except when such services are supplemental;
  • Inpatient hospital services;
  • Outpatient medical services;
  • Emergency health services;
  • Urgent care services;
  • Diagnostic laboratory services and diagnostic and therapeutic radiologic services;
  • Diagnostic and treatment services (other than prescription drug services) for biologically based mental illnesses;
  • Preventive health care services, including, but not limited to, voluntary family planning services, infertility services, periodic physical examinations, prenatal obstetrical care, and well-child care; and
  • Routine care for patients enrolled in an eligible cancer clinical trial.

The term basic health care services does not include experimental procedures.

Urgent care services means any medical services that are appropriately provided for an unforeseen condition that requires immediate medical attention but that does not pose a threat to the life, limb, or permanent health of the injured or ill person.

2. Hospital and Emergency Services

The HIC provides the member with inpatient hospital care, in or out of the service area. The services may be limited for treatment of mental, emotional or nervous disorders, including alcohol or drug rehabilitation or treatment.

Emergency care must be provided for the member in or out of the HIC service area. If emergency care is being provided for a member outside the service area, the HIC will be eager to get the member back into the service area so that care can be provided by salaried member physicians.

3. Supplemental Health Care Services

Supplemental or special health care services are any of the health care services listed below that can be provided by an HIC alone or in combination with basic health care services or other supplemental health care services:

  • Services of facilities for intermediate or long-term care, or both;
  • Vision care and optometric services including lenses and frames;
  • Podiatric care or foot care services;
  • Mental health services for non-biologically based mental illnesses;
  • Short-term outpatient evaluative and crisis-intervention mental health services;
  • Medical or psychological treatment and referral services for alcohol and drug abuse or addiction;
  • Home health services;
  • Prescription drug services;
  • Nursing services;
  • Services of a licensed dietitian;
  • Physical therapy services;
  • Chiropractic services;
  • Any other category of services approved by the Director of Insurance.

If an HIC offers prescription drug services, the coverage for prescription drugs for the treatment of biologically based mental illness must be provided on the same basis as for any other physical disease or disorder.

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HIC Certification and Regulation

1. Certificate of Authority

In order to establish, operate, or perform the services of a HIC in Ohio, a corporation formed by or on behalf of a publicly owned, operated, or funded hospital or health care facility must first obtain a Certificate of Authority from the Director. Corporations domiciled in another state that does not have HIC regulations similar to those in Ohio must first form a domestic corporation prior to applying for a Certificate of Authority.

Insurers that offer an open panel plan are not required to obtain a HIC Certificate of Authority, as long as the providers and health care facilities participating in the open panel are compensated directly from the insurer. Additionally, intermediary organizations are not required to obtain a Certificate of Authority, as long as the organization maintains ultimate responsibility to assure delivery of health care services.

Though health delivery networks doing business in Ohio are not required to obtain a Certificate of Authority, including those functioning as an intermediary organization, the network must provide the Director with a signed statement containing the network’s full name, address, and an acknowledgement that the network does not maintain a Certificate of Authority. The statement must be provided to the Director annually, no later than July 1.

2. Solicitation Documents and Advertising

Any changes in a health insuring corporation’s solicitation document must be filed with the Director 30 days prior to use. The Director then has 60 days to approve or disapprove any solicitation document or amendment on any grounds.

The solicitation document must contain all information necessary to enable a consumer to make an informed choice as to whether or not to enroll in the HIC. The information must include a specific description of health services and the approximate number and type of full-time equivalent medical practitioners. It must also be presented in a manner that is clear, concise, and intelligible to prospective applicants in the proposed service area.

Health insuring corporations (or their agents, employees, or representatives) may not use any advertisement or solicitation document or engage in any activity that is unfair, untrue, misleading, or deceptive.

HICs may not use names that are deceptively similar to the name or description of any insurance company or surety corporation doing business in Ohio.

A health insuring corporation that provides basic health care services may use the phrase “health maintenance organization” or the abbreviation “HMO” in its marketing name, advertising, solicitation documents, or marketing literature, or in reference to the phrase “doing business as” or the abbreviation “DBA.”

3. Confidentiality of Medical and Health Information

Any information pertaining to the diagnosis, treatment or health condition of an HIC enrollee or applicant must be held confidential and cannot be disclosed to any person except under one of the following circumstances:

  • With the enrollee’s consent;
  • If required by a court order as evidence;
  • In the event of claim litigation between the enrollee and the HIC.

4. Open Enrollment

Health insuring corporations are required to hold an open enrollment period at least once during each 12-month period in order to accept new members, assuming that the HICs have not reached maximum capacity. These open enrollment periods must last at least 30 days. In certain cases, the Director may waive the requirements for an open enrollment period or authorize enrollment underwriting restrictions as deemed necessary. The open enrollment period requirement does not apply to HICs that offer only supplemental health care services, or that offer plans only through Medicare, Medicaid, or federal health care programs.

5. Evidence of Coverage and Information to Provide Subscribers

Evidence of coverage means any certificate, agreement, policy or contract issued to a subscriber that sets out the coverage to which the person is entitled under a health care plan. Every subscriber of a health insuring corporation is entitled to an evidence of coverage in the form of an identification card or a similar document.

The evidence of coverage card must specify the health insuring corporation’s name and provide at least one toll-free telephone number that provides the subscriber with access to information on a 24-hour, 7-days-a-week basis, as to how health care services may be obtained.

The card must also list at least one telephone number that, during normal business hours, allows the subscriber access to information on the coverage available under the subscriber’s health care plan and information on the health care plan’s internal and external review process.

Information Provided to Subscribers

Each insurer must provide to its policyholders and subscribers the following information:

  • A description of the health insurance company;
  • Methods of operation;
  • Current service area, and the most recent providers list;
  • Complaint procedure process; and
  • A description of how the insurer determines the need for future services.

At the request of the subscriber, an insurer may provide this information electronically or in hard copy by mail. A health insurance corporation may also satisfy this requirement by providing the subscribers a web site with access to all required information.

This information will be provided to the insured annually unless the insurer is a specialty health care insurer only in which case the information will be provided biennially.

6. Renewal

Health insuring corporation may not cancel or fail to renew the coverage of a subscriber or enrollee because of any health status-related factor in relation to the subscriber or enrollee, the subscriber’s or enrollee’s requirements for health care services, or for any other reason designated under rules adopted by the Director.

Health status-related factor refers to any of the following:

  • Health status;
  • Medical condition, including both physical and mental illnesses;
  • Claims experience;
  • Receipt of health care;
  • Medical history;
  • Genetic information;
  • Evidence of insurability, including conditions arising out of acts of domestic violence; and/or
  • Disability.

A health insuring corporation may cancel or decide not to renew the coverage of an enrollee if the enrollee has performed an act or practice that constitutes fraud or intentional misrepresentation of material fact under the terms of the coverage and if the cancellation or nonrenewal is not based on any health status-related factor in relation to the enrollee.

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Specialty HIC

A specialty health insuring corporation provides specialty health care services on an outpatient-only basis, and not in combination with other supplemental health care services.

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Health Insuring Corporations (HICs)

Unlock the world of Health Insuring Corporations (HICs) – your key to comprehensive healthcare coverage. Navigate the intricate landscape of insurance protection, discover services, and stay informed on trends. Trust HICs for a healthier, more secure future. Explore now!

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