Final answer:
The treatment plan sent to the insurance company in advance to determine coverage is called pre-determination. This is part of managing how health insurance benefits are administered, alongside concepts like deductibles, copayments, and coinsurance which affect out-of-pocket costs for patients.
Step-by-step explanation:
The treatment plan sent to the insurance company to determine a patient's benefits is known as pre-determination. This process involves the insurance company reviewing a proposed treatment plan to confirm what services are covered under a patient's policy and at what rate. It's important for patients to be aware of their deductible, which is the amount they must pay out-of-pocket before insurance coverage kicks in. They should also be familiar with other terms such as copayments and coinsurance, which require the policyholder to pay a certain fee or percentage of costs, respectively. Understanding these concepts is critical as it helps to reduce moral hazard by ensuring that the insured party bears some of the costs before collecting insurance benefits.
In health insurance, different types of arrangements can exist, such as fee-for-service and health maintenance organizations (HMOs). In a fee-for-service system, providers are paid based on the services rendered, while in an HMO, providers are prepaid a fixed amount for each patient enrolled, regardless of the number of services provided.