Common Types of Health Plans
There are several types of health plans available and that can sometimes be a little confusing to people. Most of them are referred to just by their initials, such as HMO, PPO, POS, FFS, and HSA. But many people are unaware of what they actually stand for and the types of plans they represent. It’s a good idea to be aware of the different types of health plans available to see which one suits you and your family the best.
PPO (Preferred Provider Organization)
A preferred provider organization plan is one in which the insurance provider uses a network of health care professionals, medical centers and doctors. The members of the insurance plan can then access these physicians and hospitals when they are in need of health care services. However, you don’t have to visit a doctor or health care provider that belongs to the network. You’re free to visit physicians and hospitals that don’t belong to the insurer’s list of network providers, but it will cost you more to do so.
HMO (Health Maintenance Organization)
A health maintenance organization also offers a list of network providers to its members. However, in this type of plan you have to stick to visiting the doctors and hospitals that are listed in the network.
You will also be asked to select a primary care physician (PCP). This doctor will be the one you visit for all of your medical needs and routine visits. The doctor will diagnose you and will be able to refer you to a specialist or a hospital if it is deemed necessary.
A HMO offers a little less flexibility than a PPO due to the fact you have are restricted to visiting the health care providers from the insurance company’s network. However, these plans are usually less expensive than PPOs.
POS (Point of Service)
A point of service health plan is sort of a combination of an HMO and PPO plan. With these plans you’re also asked to select a primary care physician (PCP) for your routine visits, initial diagnosis and referrals to specialists. Yet the plan will cover you for visiting doctors and other health providers that are both in and out of the insurer’s network.
FFS (Fee For Service)
A fee-for-service plan is often referred to as indemnity insurance. It’s the most traditional type of plan available, but actually the least popular as it is more expensive. A FFS plan doesn’t provide a network of health providers as it is designed to cover specific medical services. You are free to visit any doctor and health care provider you choose in the country.
HSA (Health Savings Accounts)
A health savings is really a bank account and not a health plan. It allows you to deposit money that can be used tax-free to cover costs for health care. The money can be used for just about any type of health-related expense. However, you must first be enrolled in a high-deductible health plan before you can open an HSA. A high-deductible plan for an individual is considered to be $1,200 and it’s $2.400 for a family. The deductible can be paid with money from the HSA account.
Talk to a licensed agent to see what type of health plan is right for you and your health care needs.