Health Insurance

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Health Insurance Types | Health Coverage | Additional Coverage | Fee For Service (FFS) | Health Maintenance Organizations (HMO) | Point Of Service (POS) | Preferred Provider Organizations (PPO) | Health Insurance Costs

Health Insurance Types

HMO, PPO, POS ??? Here is an explanation on types of health insurance.

What types of health insurance are available?

Health insurance plans generally fall into one of two categories: indemnity plans (also known as reimbursement plans) and managed care plans such as health maintenance organizations (HMOs), preferred provider organizations (PPOs), and point of service (POS) plans.

An indemnity plan allows you to choose your own doctors and pays for your medical expenses--totally, in part, or up to a specified amount per day for a specified number of days.

Managed care plans generally provide broader coverage, but they all involve an arrangement between the insurer and a selected network of health-care providers (doctors, hospitals, etc.). For example, an HMO will require that a primary care physician in the network coordinate all of your care and refer you to specialists in the network.

We also provide pages for each of the type of networks. (View links to the left)

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Health Coverage

No matter which type of health insurance you buy, you'll need to make sure it offers the right kinds of coverage.

What should be covered?

A good health insurance policy contains several types of coverage.

Hospital expense insurance pays your room, board, and incidental services costs if you're hospitalized.

Surgical expense insurance covers surgeons' fees and related costs associated with surgery.

Physicians' expense insurance pays for visits to a doctor's office or for a doctor's hospital visits.

Major medical insurance offers extremely broad coverage with a very high maximum benefit that's designed to protect you against losses from catastrophic illness or injury.

Prescription coverage generally offers a co-pay on drugs. The insurance company may have their favorite drugs that you may get the best price (usually generic). These co-pays can be either a flat fee for prescriptions or a percentage of the total cost. Do not assume this is covered! More and more plans are doing away with this coverage as the prices for drugs are on the rise.

When comparing health insurance plans : Make sure you always compare the same coverages to get the most accurate pricing.

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Additional Coverage

Don't assume that any specific item is covered in a health policy. To cut down insurance costs companies are excluding more and more.

Here are some other items that are typically not included, but may at an additional cost.

• Prescription drugs (co-payments or sometimes a percentage of regular price on preferred drugs)
• Preventive care (such as shots for children, boosters, etc)
• Mental health benefits (work related, personal, family, etc.)
• Maternity care (doctors visits, tests, delivery, hospital stay, follow up, etc)
• Vision care (eye exams, contacts, eyeware, etc)

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Fee for Service (FFS)

FFS coverage offers flexibility in exchange for higher out-of-pocket expenses, more form filing, and higher premiums.

Here are the advantages and disadvantages:

Fee for service advantages:

You may choose your own doctors and hospitals.

You may visit any specialist without getting permission from a primary care physician.

FFS disadvantages:

There's typically a deductible (anywhere from $500 to $2,000) before the insurance company starts paying claims, and then doctors are reimbursed about 80 percent of the bill while you pick up the remaining 20 percent.

You might have to pay up front for medical and hospital services, and then submit the bill for reimbursement.

FFS plans pay only for "reasonable" medical expenses. If your doctor charges more than the average for your area, you will have to pay the difference.

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Health Maintenance Organizations (HMO)

HMOs are the least expensive, but also the least flexible of all the health insurance plans. They are geared more toward people seeking health insurance as a group.

Here are the advantages and disadvantages:

HMO advantages:

They offer their customers / group members low co-payments, minimal paperwork, and coverage for many preventive-care and health-improvement programs.

HMO disadvantages:

You must choose a primary care physician, also known as a PCP.

HMOs require you to see only network doctors, or they won't cover.

You must get a referral from your PCP to see a specialist.

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Point of Service (POS)

Point of service plans are more flexible than health maintenance organizations (HMOs), but they also require you to select a primary care physician (PCP).

Here are the advantages and disadvantages:

POS advantages:

Depending on your insurance company's rules, you may choose to visit a doctor outside the network and still receive coverage — but the amount covered will be different than if you went to a physician within your network.

These plans tend to offer more preventive care services, such as workshops on smoking cessation and discounts to health organizations and clubs.

POS disadvantages:

Member must choose a primary care physician.

While you may choose to see a physician outside the network, if you don't receive permission from your PCP, you're likely to end up submitting the bills yourself and might receiving only a partial reimbursement.

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Preferred Provider Organizations (PPO)

Preferred provider organizations (PPOs) give members a financial incentives and reasonable co-payments to stay within the group's network of providers.

Here are PPO advantages and disadvantages:

PPO advantages:

The standard co-payment is $10 for a routine office visit during regular hours.

You may go to any specialist without permission, as long as the doctor participates in the network.

PPO disadvantages:

If you see an non-network doctor, you might have to pay the entire bill yourself, and then submit it for reimbursement.

You might have to pay a deductible if you choose to go outside the network, or pay the difference between what network doctors and out-of-network doctors charge.

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Health Insurance Costs

Deductibles... Co-payments... Here are the costs associated with health insurance.

What will it cost?

In addition to the monthly premium expense, you may have other out-of-pocket costs. These costs can really add up, especially if you have children or other family members who visit the doctor frequently.

Check to see if the health insurance plan you're considering requires you to pay any or all of the following:

Co-payment:

The amount you'll have to pay each time you visit a health insurance provider (generally required by HMOs).

Deductible:

The amount you'll have to pay toward your medical expenses (usually annually) before the insurance company begins to pay claims (generally required by indemnity plans).

Coinsurance:

The percentage of your medical costs you'll have to pay after you reach any deductibles that apply.

Always read the fine print to find any hidden costs associated with any health insurance. As well as the terms regarding late fees and lapse time for the policy.

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