Health Care Economic Issues (HMO) Simulation
HEALTH CARE ECONOMIC ISSUES 6
Castor Collins health plan is one of the biggest health facilitiesthat provide health insurance facilities or health maintenanceorganizations (HMO) to companies. It is found in state of Pantome.Castor Collins has been offering its facilities for over a decade nowand has approximately 100000 customers (Stretchgo n.d). As part ofthe firm`s growth measures, Castor Collins has embarked on endemicenrollment journey for it to be able to grow the number of peopletaking their insurance covers. There are two firms that are seekingto take Castor Collins` insurance policies for their workers. Thepolicy holder is under health so this is a big advantage to thisinsurance company. These two companies are, Constructit Company thathas almost 1,000 policy holders who do not have any type ofcompensation from their employer. The second firm that is seekingCastor Collins insurance facilities is E- editor which has close to1,600 stakeholders. Workers from E-editor firm will provide annualfee of $4,500 for themselves. Constructit employees on the other handwill cater for their own annual fee of $4,000 as well. Castor Collinshas chosen three cover plans that are meant to accommodate these twofirms. The insurance company shall revisit the firm`s information soas to know the type of plan that suits either of the companies forthem to fulfill their requests. Castor Collins will ensure that theireconomical obligation will be low.
The three cover plans this insurance company has to give are CastorStandard, Castor Enhanced and Castor enhanced minor. The firstinsurance plan, which is Castor Standard, has no application for anysickness that a person had before getting the insurance cover. Castorenhanced disburses reimbursement on any sickness that the enrolleehad prior to obtaining the cover. The last plan, castor enhancedminor has the same policies to castor enhanced only that the clientsof this plan do not profit from some of the sophisticated servicesoffered by castor enhanced (Atkins & Bates, 2008).
Castor and Collins insurance Company has its main objective ofgiving its customers the best quality services ever for theirpremiums but the company ensures that it does not incur loses whileproviding these services to the clients.
Going back to E- editor firm, as mentioned earlier in this paper,the company has 1600 workers and among these, 840 are women and therest are men. The organization will cater for yearly premiums of $4,500 dollars per individual. Among these workers, 29% are aged 50-54whereas 32% are between 45-49 years of age. A huge percentage ofworkers in this company work in administration, so their healthconditions are almost perfect. 22% of the employees are almost in aperfect health condition, 26% do smoke so they have respiratorysystem problems. Since most of them just sit behind their desks tocarry out their daily chores, the main health crisis that the firm isfacing is obesity which is at 45%, 37.7% of workers suffer from highcholesterol whereas the blood pressure for 15% is high.
After reviewing the company`s employee’s health status, CastorCollins has decided that it won’t insure the E-editor companyemployees since the risk is too high. For instance, the CastorEnhanced plan would not favor the firm financially since there is avery high risk of insuring elderly people due to the most employees’age. A good number of workers from this company are old so they aremore prone to many health conditions such as diabetes and high bloodpressure. Most of the employees are aged 45 years and above. When youlook at the castor Standard plan, it won’t suit the employees fromthis firm since Castor Standard plan does not offer indemnity for anymedical conditions and diseases. In case the company insures thisorganization`s employees, then it is prone to incurring loses rathermaking profit.
The next firm which is Constructit Company, as seen earlier has 1000workers employed by the company. Maximum premiums for every employeethat the organization is willing to pay are $4,000 dollars. In these1000, 550 are men and the women are 450 (University of Phoenix,2012). Unlike the former company, a good number of employees ofContsructit firm engage in vigorous physical activities while doingtheir daily chores. 32% of employees involve themselves in vigorousphysical activities whereas 25% of the workers involve in mediumphysical activities and 43% have tertiary activities. It is worthnoting that 40.6% of employees aged 26 to 30. And only 17.7 % ofworkers have allergies and 19.3% have high blood pressure. 39% areobese whereas just 10% of workers smoke (University of Phoenix,2012).
Looking at this record, Castor Collins Insurance company feels thatthe best insurance plan for Constructit company employees would becastor standard. The fact that the organization if willing to pay apremium rate of $4,000 annually per employee, the health risks thatemployees are more likely not to encounter such as those oflifestyles, type of job and mostly age are few. The plan can bedelivered at a minimum premium since 1000 workers will be ensured andamong these employees, those aged between 26-30 are many so theywon’t experience medical conditions more often and their healthrisks are minimal. Castor enhanced and Castor enhanced minor planswon’t be suitable for this organization because the employees willneed to have a high annual premium amount which the firm is notwilling to pay for the employees. Assuming Castor Collins insurancecompany took these plans, the company is more prone to running at aloss that making a profit for itself (University of Phoenix, 2012).
After looking at the Castor Collins insurance company and theirpolicies, this paper concludes that having a health insurance for anyfirm for its` employees is a very important aspect though thiscarries with it the pros and cons to the insurance company as well asthe insured organization. An insurance company, prior to insuringemployees of any company should look at the workers demographics, anyrisks that workers can have health-wise as well as the value ofyearly premiums the firm is willing to pay per worker. Any healthinsurance firm should evaluate and asses these conditions before itdraw a conclusion of offering its health services to any company. Tothe workers, ensuring that they be healthy always is a vital point ingetting health insurance from any insurance company.
Atkins, D., & Bates, I. (2008). Insurance. London, U.K.:Global Professional Publishing.
Stretchgo. Castor Collins health Financing. Retrieved From,https://www.stretchgo.com/about-stretchgo/castor-collins-health-financing.html
University of Phoenix. (2012). The Financing of Health Care:Understanding Economic Issues for HMOs. Retrieved from,https://ecampus.phoenix.edu/secure/aapd/vendors/tata/UBAMSims/financing_health_care/financing_health_care_economic_issues_hmo_simulation.html