If you are trying to select a health insurance option, you may be having some difficulty. There are many different insurance plans to choose from and you want to find the one that best fits your individual needs without spending too much. It is imperative that you have a basic understanding of health insurance plans before making a decision.
The three forms of health insurance payments are premium, co-payment, and deductible. A premium is the overall cost of your medical insurance that you pay to the insurer. It is usually an annual rate that is split into monthly payments. A co-payment is a set amount that you pay to a health care provider before they provide care to you. A deductible is money that you pay to the health care provider, either a fixed amount or percentage of the bill, that you must pay before the insurer pays the remainder.
In the world of medical insurance, plans can really be broken down into four broad categories. The categories are health maintenance organization (HMO) plans, point of service (POS) plans, preferred provider organization (PPO) plans, and fee for service (FFS) plans. Each of them has varying degrees of flexibility and premium costs. They each also have particular advantages and disadvantages associated with them.
Usually, the cheapest type of policy is the HMO. Within an HMO, you are allocated a primary care physician that is responsible for your health care. If they are unable to treat you, they will refer you to a specialist. The premium is very low and you only have to pay low co-payments for each doctor visit. If you see a doctor without a referral, the insurance company will not cover the bill at all.
The POS plan similar to an HMO in that you are assigned a primary physician and they make referrals for you. However, the premium and co-payments are higher. In return, you have the option to seek care outside your primary physician or the specialists that they refer you to. In a POS, you can pay a deductible to see other doctors.
A preferred provider organization (PPO) offers more leniency than a POS plan. In a PPO, you are not assigned a primary physician. Instead, you are authorized to seek care from any doctor within the PPO network and pay with co-payments. Additionally, you can seek outside care if you would like by paying a deductible. PPOs have become fairly popular insurance plans over the past several years.
The most flexible plan is known as a fee for service (FOS) plan. It is also the most expensive plan to choose. It allows you the ability to see any doctor that you want and only have to pay a deductible. However, most insurance companies have implemented caps on this type of coverage and if you exceed the cap, you will be responsible for the remainder of the bill.
There are a lot of different health care plans available. Each plan has advantages and disadvantages, so you will have to choose what works best for you. When you choose an insurance policy, however, it is important that you understand all of the terms and conditions of the policy before committing to it.
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