PPO, HMO and POS
There are so many types of health insurance to choose from, it’s no wonder people often feel helpless about it. At InusranceUSA.com we provide you with thorough and up-to-date information on all types of health insurance.
Typically, health insurance can be divided into two overarching categories: traditional and managed care. These can further be broken down into four basic plan types:
- Traditional indemnity health insurance; now often called Fee-for-Service (FFS) plans.
- Preferred Provider Organization or PPO
- Point-of-Service or POS
- Health Maintenance Organization HMO
Preferred Provider Organization
Preferred Provider Organization (PPO) plans are an affordable and popular option for family health insurance because they are comprehensive and flexible. You will save money covering your family when they use preferred network physicians but a PPO also provides you with coverage on out-of-network doctors as well.
PPO health insurance allows substantial discounts from providers who are within the network. Unlike HMOs, PPO health insurance typically offers coverage with a deductible and coinsurance rather than a co-payment. Deductibles must be paid before the insured’s benefits take effect and then the co-insurance benefits apply.
PPO health insurance is usually the least expensive of managed care health insurance because the patient picks up a substantial portion of the “first dollars” coverage.
Health Maintenance Organization
A Health Maintenance Organization (HMO) is one of the more affordable individual health insurance alternatives. HMOs usually have an extensive network of doctors, specialists, hospitals, and clinics, plus much more. HMO networks often encompass a wide and varying range of healthcare professionals so you’ll have convenient access to all your healthcare needs.
HMOs act as a coordinated delivery system designed to pay for and deliver healthcare to its members. Each member is usually assigned a gatekeeper or primary care physician (PCP) who sees to the overall care of that member. Specialists and non-emergency hospital admissions usually require a referral from a PCP.
Point of Service
Point of Service (POS) plans are essentially a mixture of the HMO and PPO. Like an HMO you pick a primary care physician but as in a PPO, if you can seek help from any medical professional in or out-of-network and you will still be covered.
POS plans are still managed care resulting in lowered medical costs in return for more limited choices. Point of Service health insurance is sometimes called an open ended HMO or PPO. The major difference though is policyholders are allowed to seek help outside the POS network though there is more of an incentive to choose providers within the network.
Newly enrolled POS member choose a primary care physician (PCP) as they would in other managed care health insurance. From there the doctor becomes the insured’s “point of service” and will refer the insured to other healthcare providers, even if they are not in the provider network.