Types Of Health Insurance Plans

Your care needs and budget will determine the health insurance plan you choose. Here are the main options:

Indemnity (fee-for-service)
The most flexible and expensive option, these plans provide customers complete freedom in choosing a doctor or hospital, in exchange for an annual deductible and a percentage of the medical bill.

Managed care
Managed care is more popular and affordable. Choices include:

Preferred Provider Organization
Customers can choose from doctors inside or outside the plan. If they choose PPO doctors, they pay a discounted co-payment. For non-PPO doctors, they typically pay up-front and then submit the bill. Customers are typically responsible for co-insurance percentages once a calendar-year deductible is met. Certain high-deductible PPO plans qualify for 100% tax-deductible health savings accounts.

Health Maintenance Organization
Customers pay a small, set co-payment when they use an HMO network doctor, but generally don’t pay deductibles. They choose a plan-approved primary care physician to manage their care and refer them to specialists. This option offers less flexibility, less paperwork and lower costs.

Point-of-Service
Customers choose a plan-approved primary care physician to manage their care and refer them to plan specialists. They can also opt to go outside the plan network, but this added flexibility brings with it a higher cost and more paperwork.

Catastrophic
This flexible high-deductible coverage, best suited for people in good health, can also be eligible for health savings accounts. It is intended for major hospital and medical expenses, not routine care.

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