The Six Common Types of Health Plans

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With the Marketplace making Health Insurance products more accessible and affordable than ever before, people have the opportunity to choose from MANY different policies, as opposed to before when most people just took whatever insurance an Employer may have offered them. While most people are familiar with or have heard of HMOs and PPOs, newer types of policies have become increasingly popular. So what are the main six kinds of Health Insurance Plans?

Health Maintenance Organizations (HMOs)

An HMO has all of your health services go through a network of healthcare providers and facilities. If your Doctor/facility is not in the HMO Network, then the Insurer will not cover your services. With an HMO, you may have:

  1. The least freedom to choose your health care providers
  2. No claim forms
  3. Your Primary Care Doctor will manage your care and refer you to Specialists within the Network. Most services under an HMO require a referral.
  4.  If you see a doctor who is not in the network, you’ll may have to pay the full bill yourself; However, Emergency services at an out-of-network hospital must be covered at in-network rates. This can be confusing though because if a Non-Participating Doctor treats you in the hospital, they can bill you.
What you pay:

  • Premium: This is the cost you pay each month for insurance.
  • Deductible: Your plan may require you to pay the amount of a deductible before it covers care except for preventive care.
  • Copays and/or co-insurance for each type of care. A copay is a flat fee, such as $15, that you pay when you get care. Coinsurance is when you pay a percent of the charges for care, for example 20%. These charges vary according to your plan and they are counted toward your deductible.
  • .Paperwork involved. There are no claim forms to fill out.

 

Preferred Provider Organization (PPO)

A PPO gives you the freedom to see Specialists without the need of a referral from your Primary Care Doctor. PPOs also have in-network and out-of-network benefits; however your out-of-network coverage can cost you more than using in-network. With a PPO you have:

  1. A moderate amount of freedom to choose your health care providers.
  2.  You do not have to get a referral from a primary care doctor to see a specialist.
  3. Higher out-of-pocket costs if you see out-of-network doctors vs. in-network providers
  4. More paperwork than with other plans if you see out-of-network providers.

What you pay:

  • Premium: This is the cost you pay each month for insurance.
  • Deductible: Some PPOs may have a deductible. You will likely have to pay a higher deductible if you see an out-of-network doctor.
  • Copay or coinsurance: A copay is a flat fee, such as $15, that you pay when you get care. Coinsurance is when you pay a percent of the charges for care, for example 20%.
  • Other costs: If your out-of-network doctor charges more than others in the area do, you may have to pay the balance after your insurance pays its share.
  • Paperwork involved. There’s little to no paperwork with a PPO if you see an in-network doctor. If you use an out-of-network provider, you’ll have to pay the provider, then file a claim to get the PPO plan to reimburse you.

 

Point-of-Service Plan (POS)

A POS plan blends features of an HMO with a PPO. Like an HMO, you must get a referral from your PCP in order to see Specialists. Like a PPO, you have the option to go out-of-network for services. With POS plan, you may have:

  1. More freedom to choose your health care providers than you would in an HMO
  2. A moderate amount of paperwork if you see out-of-network providers
  3. A primary care doctor who coordinates your care and who refers you to specialists
  4. You can see in-network providers your primary care doctor refers you to. You can see out-of-network doctors, but you’ll pay more.

What you pay:

  • Premium: This is the cost you pay each month for insurance.
  • Deductible: Your plan may require you to pay the amount of a deductible before it covers care beyond preventive services.You may pay a higher deductible if you see an out-of-network provider.
  • Copays or coinsurance: You will pay either a copay, such as $15, when you get care or coinsurance, which is a percent of the charges for care. Copayments and coinsurance are higher when you use an out-of-network doctor.
  • Paperwork involved. If you go out-of-network, you have to pay your medical bill. Then you submit a claim to your POS plan to reimburse you.

Exclusive Provider Organization (EPO)

An EPO is once again a kind of mix between an HMO and PPO, but the opposite than a POS. With this policy you do not need referrals to see a Specialist, however you have no out-of-network benefits (with the exception of an emergency). With an EPO, you may have:

  1. More freedom than an HMO to choose your health care providers
  2. You do not have to get a referral from a primary care doctor to see a specialist.
  3. No coverage for out-of-network providers, unless in an emergency.
  4. You can see any Provider in the EPO’s network.

What you pay:

  • Premium: This is the cost you pay each month for insurance.
  • Deductible: Some EPOs may have a deductible.
  • Copay or coinsurance: A copay is a flat fee, such as $15, that you pay when you get care. Coinsurance is when you pay a percent of the charges for care, for example 20%.
  • Other costs: If you see an out-of-network provider you will have to pay the full bill.
  • Paperwork involved. There’s little to no paperwork with an EPO.

 

High-Deductible Health Plan With/Without a Health Savings Account

A HiDHP is a policy that has a Deductible you must meet before the plan pays for your treatment. There are many types of HDHPs available. Some will give you 100% coverage once the deductible is met, while others can go as low as only 50% coverage. The amount of coverage after the deductible is met and how high the deductible is determines the premium ranges for these policies. Also, with these plans you can open a Health Savings Account where you can use pre-tax dollars to pay for a huge range of services and medical supplies as well as some OTC products. With an HDHP, you may have:

  1. One of these types of health plans: HMO, PPO, EPO, or POS
  2. Higher out-of-pocket costs than many types of plans; However once you reach the maximum out-of-pocket amount, the plan pays 100% of your care.
  3. A health savings account (HSA) to help pay for your care; In order to have a HSA, you must be enrolled in a HDHP.
  4. Which doctors you see and if you have out-of-network benefits varies depending on the type of plan you have (HMO, POS, EPO, or PPO)

What you pay:

  • Premium: An HDHP generally has a lower premium compared to other plans.
  • Deductible: The deductible is at least $1,350 for an individual or $2,700 for a family, but not more than $6,650 for an individual and $13,300 for a family in 2018. Like with all plans, your preventive care is free even if you haven’t met the deductible.
  • Copays or coinsurance:  Other than preventive care, you must  pay all your costs up to your deductible when you go for medical care.
  • You can set up a Health Savings Account to help pay for your costs. The maximum you can contribute to an HSA in 2018 is $3,450 for individuals and $6,900 for  families.
  • Paperwork involved. Keep all your receipts so you can withdraw money from your HSA and know when you’ve met your deductible.
In the past we have put together some helpful information on  HSA policies. Updated info on HSA limits for 2019 can be found here.  We have also posted a handy guide of what kind of things can be purchased and what you can use HSA funds for. You can find that information here.

Catastrophic Plan

If you are under the age of 30 you can purchase a catastrophic health plan. With a catastrophic health plan you may have:

  1. Lower premium
  2. 3 primary care visits before the deductible applies
  3. Free preventive care, even if you haven’t met the deductible
  4.  You can see any Providers in the plan’s network; individual plans may have additional rules on specialists.

What you pay:

  • Premium: This is the cost you pay each month for insurance.
  • Deductible: A catastrophic health plan has a deductible of $7,350 for an individual and $14,700 for a family in 2018. After you reach that deductible, the plan will pay 100% of your medical costs for covered benefits.
  • You will want to keep track of your medical expenses to show you have met the deductible.

 

 
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