Tuesday, December 07, 2010

Health Insurance Plan Comparisons

If you’re not familiar with the health insurance industry, choosing a medical plan presents a potentially significant challenge. Multiple types of health insurance plans exist, each with different features and benefits.

Your specific needs and budget should determine the policy you buy and understanding the differences between the plan types will make the task of picking the right one much easier and less confusing.

Health Maintenance Organization


Health Maintenance Organizations, or HMOs, are one of the most common medical plan types. Benefits exist for covered members, as long as treatment is provided by physicians or facilities within an established network.

Your costs remain limited to deductibles and co-pays, with the remainder of the treatment balance paid by the insurance company. If you receive medical services from someone not currently participating in the health plan’s network, no portion of the bill is covered by the HMO.

Preferred Provider Organization


Preferred Provider Organizations, or PPOs, are slightly less common than HMOs, but offer greater flexibility and freedom. An established network of doctors still exists, and your cost for treatment is the lowest when received by in-network physicians.

However, if you need or choose to seek services from someone outside the network, the insurance company will still pay a portion of that balance. Your out-of-pocket costs increase for visits to nonparticipating providers, but the freedom to choose any physician might be advantageous or even necessary for your situation.

Point of Service Plan


Point of Service plans, or POSs, are a type of hybrid medical insurance policy that blends HMOs and PPOs. The insurance company still restricts your treatment to the established network of doctors, but policies contain provisions allowing payment for services received by nonnetwork providers in approved circumstances.

Usually, POS plans only allow visits to nonnetwork physicians in cases where the number of specialists needed for your treatment is very small or geographically spaced far apart. In those situations, nonnetwork doctors will still receive payment for services rendered, but only if those services are preapproved.

Exclusive Provider Organization


Exclusive Provider Organizations, or EPOs, are less common than other types of health insurance and not available in every state. However, EPO plans continue to increase in popularity because of their lower premiums.

This type of health insurance plan provides benefits that pay for preventative services and catastrophic situations, but little in between. These “limited benefit policies” only pay for treatment received by in-network providers, but pay much lower amounts that leave higher responsibility on patients.

Additionally, EPO plans often exclude payment for a wide array of goods and services normally covered by other plan types, leaving things like prescription medications, crutches, ambulance rides, and X-rays paid for by patients.

References


HealthInsurance.info: Exclusive Provider Organization
AHRQ: Consumer’s Guide to Questions and Answers About Health Insurance
HealthInsuranceBible.com: EPO Health Insurance In-Depth Overview




This article is a Twisted Nonsense Exclusive! (12/07/2010)