Health insurance plans are a lot like people. While some may appear intimidating, others may give off a more welcoming vibe. Yet, in the end, the internal makeup is essentially the same and the only thing that matters is which type of person, or health insurance plan, fits you the best.
However, it may not be prudent to try out various health insurance plans for the right fit, which means research is needed to understand the different types of managed care in the U.S. and what they exactly offer the consumer.
Fee-for-Service Plans
This is also called indemnity insurance and is the typical kind of coverage where people pay for the health service when they need it. Under this plan, customers are required to pay a low premium every month as well as a co-pay for services and an annual deductible.
Each year, the enrollee is required to pay a certain amount for various services, which is called a deductible, which could be split 80 percent to the insurance providers and 20 percent to you. The amount you pay is called a “coinsurance.” The catch is that not all healthcare bills fall under one’s deducible.
These plans may have a cap of what a consumer will pay for medical services in one year. This means when your deducible and coinsurance reach a certain amount, the health insurance provider will begin to pay your bill in full. The cap can range from $1,000 to $5,000 a year.
There are two types of fee-for-service coverage: basic and major medical. Basic covers the costs of a hospital visit and the care you receive while there as well as doctor visits. Major medical covers the cost of high-cost illnesses with expensive treatments and injuries.
Some policies may combine both into one type of coverage called a comprehensive plan. Again, be sure to check the reach of your coverage. While this type is good for people who may needed immediate medical treatment, it may not be financially sound for those looking to get regular checkups.
Health Maintenance Organizations (HMOs)
For a monthly premium, these prepaid health insurance plans give enrollees comprehensive plans for you and your family and includes doctor visits, surgery, lab tests and therapy.
There are certain doctors and hospitals included under an HMO plan, which may limit one’s choices in terms of healthcare. Each doctor or hospital visit may come with a small co-pay, which can range from $5 to $20.
Under this plan, your healthcare costs have the potential to be lower. People under this plan are urged to get preventative care such as immunizations, checkups and physicals. Enrollees must pick a primary care doctor and cannot see a specialist unless they are recommended to by their doctor.
During a visit, people are required to present a card instead of filling out various forms. However, people with an HMO may have a longer wait for an appointment when compared to those under a fee-for-service plan.
Point-of-Service Plans (POS)
This is an option under some HMO plans that allow members to refer themselves to a doctor or a specialist outside of an HMO plan and still be covered. If a doctor makes a referral out of the HMO network, the health insurance covers all or most of the bill. If the enrollee refers themselves to a doctor out of the network (and the type of service is covered in their plan), they will have to pay the coinsurance.
Preferred Provider Organizations (PPOs)
This kind of plan may be ideal for a person who has a certain doctor they are already familiar with. Like an HMO, a PPO has a certain network of healthcare providers to choose from and when they are used, the patient’s medical bills are mostly covered. Patients are also given a card to use during their visits and not required to fill out any paper work.
However, enrollees are also able to use out-of-network doctors and still be covered under a PPO. They may have to pay a larger portion of the bill, as well as fill out claims forms, but they will be able to stick with a family or preferred doctor who may not be in the PPO’s network.
