Health insurance industry offers a selection of plan types, which may be a bit confusing for the non-experienced looking for insurance coverage. Each plan type has its strengths and weaknesses that will appeal to specific groups of buyers. And as you buy clothes to suit your style and size, health insurance plans should also be chosen according to your personal needs. So in order to make your health insurance shopping a bit easier, here are the most important and widely available types of health insurance plans that you will find on the market:
These are the oldest and simplest form of health insurance, being the first offered on the market. It involves paying a small monthly deductible, while also paying for each doctor visit and medical service received (thus the name). As a result you pay only for the services you have received, which are partially reimbursed by the insurance company, while keeping your premiums low. However, if you need frequent medical care, this form of health insurance might turn out to be quite costly.
Health Maintenance Organizations (HMOs)
This is one of the most popular forms of managed health plans, involving monthly premiums in exchange for a wide range of medical services offered (especially preventive care such as checkups, exams, laboratory tests, therapy, etc.) Under HMOs you have to choose a Primary Care Physician that will refer you to other specialist when needed. Out of network services will cost you a lot, while keeping your services within the network could give you cheap healthcare. HMOs are particularly attractive to those who need regular checkups and preventive care.
Point-of-Service Plans (POS)
This type of health insurance plans is somewhat similar to HMOs, however it has more freedom in what concerns receiving services from out of network specialists. You will have to choose PCP like with HMOs, however the physician can refer you to an out of network specialist and your medical bill will be paid for just as in case of an in-network service. Still, if you do not use your PCP referral then you will have to pay a lot for such a visit.
Preferred Provider Organizations (PPOs)
PPOs are a great option for those who have good relations with their family doctors and do not want to sacrifice the trust for getting cheaper services. Under a PPO you can set your family doctor as a PCP even if he or she does not make part of the insurance provider’s service network. You can also visit out of network specialist for a higher fee, however you will still be covered to a certain extent.