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Insurance Types Hmo Ppo

Types of Insurance

EPO (Exclusive Provider Organization)

EPO’s are among the most popular types of health insurance, and function much like a PPO with a much lower cost. This lower cost is possible because EPO’s limit coverage to in-network providers or facilities. Like a PPO, you may select where you access and receive care; from general practitioners, to specialists, to outpatient facilities. Copayments and deductibles are similar to those found in PPO plans (even in-network coinsurance or cost-sharing amounts), but there is no out-of-network coverage. The insured is fully responsible for costs of care delivered by an out-of-network provider. Except for sudden and serious emergency situations, out-of-network coverage is not an option under an EPO plan model. It is always best to understand emergency out-of-network coverage under an EPO plan so you are prepared to make decisions if the situation presents itself. When considering an EPO, be sure to check the provider network to ensure it will meet your needs. Most plans offer comprehensive medical coverage in-network, but may limit coverage and services to a specified geographic area. Under most carriers, prescription coverage and plan riders will be the same or very similar to those offered under PPO’s or even HMO’s. EPO plans can be a sensible option for those seeking the coverage and freedom of a PPO, but are willing to sacrifice the ability to seek care outside the provider network in return for a lower premium.

HMO (Health Maintenance Organization):

HMO models are in-network-only designs that utilize significant managed care policies that oversee and control access to care and services. They don’t carry nearly as many freedoms as a PPO model does, but will be available at a much lower monthly cost (among the lowest). HMOs also don’t normally carry any deductibles or coinsurance amounts (portions of the expenses under PPO and POS models that are shared by subscribers) HMO plans will commonly require the selection of a Primary Care Physician (PCP) who is responsible for managing your healthcare needs –both for you and the insurance carrier. Access to specialists, testing, out-patient hospital procedures and more is all provided through referrals from your PCP. There are no covered out-of-network providers, services, or facilities under an HMO plan; all care must be accessed within the network for plan benefits to apply. Sometime out-of-network services are unavoidable and subscribers must be prepared (or at least aware) to bear the potential costs. Some HMO models contain healthcare facilities –medical buildings that literally contain just about any services you may require for general care, lab & diagnostics, prescriptions, physical therapy, and more. For some this “one-stop-shopping” facility can be just the right fit for some individuals and families. HMOs, while containing limits, can be an advantageous and prudent choice depending on your individual healthcare needs.

PPO (Preferred Provider Organization):

A PPO Plan model is one of three most often discussed healthcare delivery systems. The initials, PPO, refer to the provider network type and the care management system. A PPO plan is one that allows free movement both within and outside of the plan’s participating provider network. The network can include general practitioners, specialists, labs, diagnostic facilities, outpatient or free-standing facilities, hospitals, durable medical equipment, pharmacies, opticians, holistic/alternative providers, therapists and more. “Free movement” within the network is commonly referred to as referral-free access (or self-referral) to doctors, specialists and more. Other plan models will require the selection of a Primary Care Physician (PCP) who is then responsible for assessing your care needs and making the appropriate referrals for additional care. However, in a referral-free PPO model some hospital admissions, diagnostic testing, out-patient surgery and more will require pre-certification. This is a process of advising the insurance carrier of your intentions to have certain services rendered and essentially receiving their approval to do so. This ensures the services received will be covered under your plan benefits as the plan allows. The main feature of a PPO plan model is the ability to access care and services outside of the plan’s network. PPO plans will cover a percentage or portion of your out-of-network care according to their allowable charges schedule (note that “100% coverage” means 100% of the plan’s allowable charges; not 100% of the total bill). PPO plan models will traditionally have out-of-network care deductibles and coinsurance amounts (portions of the expenses that are shared by subscribers) that must be met before or in conjunction with applicable plan benefits. PPO plans tend to be the most expensive plans to purchase because of their lack of their “freedoms” in accessing seeking and obtaining care.

POS (Point of Service):

A POS plan model is somewhat of a hybrid of the PPO and HMO models. A POS plan will require the selection of a Primary Care Physician (PCP), who functions as your point of service “care manager” and determines what steps or referrals should be made for the course of your care. Under a POS model, the PCP can refer patients to both and in and out-of-network providers (like a PPO, be sure to understand what your out-of-network benefits will provide for), but referrals are required as part of the managed care aspect of the POS model. Like a PPO, POS plans traditionally contain deductibles and coinsurance amounts (portions of the expenses that are shared by subscribers) that apply to out-of-network services. Monthly POS plan costs will fall somewhere in between the HMO and PPO models because although there is PPO-like freedom to seek care inside or outside the plan network, there are managed care limitations like an HMO.

Fee-for-Service:

Most often used in conjunction with “Discounted Fee-for-Service”; as the term relates to discounted benefit programs. Differing from insurance plans where one might pay only a copay at the time service is rendered or submit a claim to the insurance carrier for reimbursement, a Discounted Fee-for-Service indicates an applied discount for services where payment-in-full is expected at the time the services are rendered. Discounts on “discount fee-for-service” benefits can range anywhere from 5% to 60% and are most often applied to vision, dental, prescriptions, limited-medical in-network services, hearing and equipment programs, and more. A discounted-fee-for-service allows the consumer to realize the benefit without having to take any further action (other than pay the discounted price) or submit any additional paperwork; such as a claim form.

Managed Care

Managed care is a generic term for various health care payment systems that attempt to contain costs by controlling the type and level of services provided. Health maintenance organizations (HMOs) most often utilize and are associated with managed care/managed care practices. HMOs are a type of managed care organization.

The primary intent of managed care is to reduce health care costs. Emphasis is placed on preventive care and early intervention, rather than acute/critical care provided after an illness or injury has occurred (much more costly treatments and services). The responsibility of limiting services is often shared by the doctor/provider and the plan subscriber. Subscribers are normally required to pre-certify certain procedures, treatments, and/or costs before they can be declared as “covered” by the insurance carrier. “Gatekeeper” or Primary Care Physician policies require that individuals get referrals for specialized treatment from their primary physicians selected at the time of enrollment (changes to one’s PCP can usually be made at any time). Network providers are normally issued guidelines for administering care, prescriptions, testing and more—all designed to help limit excessive and potentially unnecessary or costs. Most every claim and most care plans (submitted by Primary Care Physicians) are also reviewed by the managed care organization first before the organization will deem the services and related expenses as “covered.”

Dental coverage comes in many forms. The most commonly found designs are Discounted Fee-for-Service, Dental Maintenance Organization (DMO), and Dental Preferred Provider Organization (PPO). All are designed to provide lower-cost dental services to a large group of insureds or members by directing them to a participating network of dentists through which fees for specific, predetermined services are negotiated at a reduced price. In the Discounted Fee-for-Service model, available dental services are listed along with their discounted prices. One must visit a network dentist to receive these discounted prices and should expect to pay for the services when rendered. These plans are traditionally the least expensive plan type.

Under a Dental Maintenance Organization (DMO), services are available on an “in-network” basis only. Payment for services can be in the form of a copay or co-insurance payment (co-insurance payments are usually much higher than a copay as they make up a larger portion of the service cost). No coverage is offered for services provided by
dentists outside of the DMO network. These plans are going to be priced to be affordable and fall in a “mid-range” category.

A Dental PPO model will allow for both “in-network” services as well as “out-of-network” services. In-network services are usually covered at a higher level with less subscriber out-of-pocket costs, while out-of-network services are covered at lower levels and can require the subscriber to bear a greater portion of the cost. Dental PPO plans are the most expensive plan type of the three because of the level and range of benefits provided.

A Dental DMO or PPO plan model will traditionally carry annual benefits maximums anywhere between $750 – $2,500 per policy or calendar year. Discounted Fee-for-Service models ordinarily do not have limitations on how much or how often you utilize the network discounts.

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All health plan, insurance coverage information, or otherwise is subject to carrier approval and/or NYSID approval.
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Different Types of Health Plans: How They Compare

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You have choices when you shop for health insurance. If you’re buying from your state’s Marketplace or from an insurance broker, you’ll choose from health plans organized by the level of benefits they offer: bronze, silver, gold, and platinum. Bronze plans have the least coverage, and platinum plans have the most. If you are under 30, you may also be able to buy a high-deductible, catastrophic plan.

How are the plans different? Each one pays a set share of costs for the average enrolled person. The details can vary across plans. In addition, deductibles — the amount you pay before your plan picks up 100% of your health care costs — vary according to plan, generally with the least expensive carrying the highest deductible.

  • Platinum: covers 90% on average of your medical costs; you pay 10%
  • Gold: covers 80% on average of your medical costs; you pay 20%
  • Silver: covers 70% on average of your medical costs; you pay 30%
  • Bronze: covers 60% on average of your medical costs; you pay 40%
  • Catastrophic: Catastrophic policies pay after you have reached a very high deductible ($7.350 in 2018). Catastrophic plans must also cover the first three primary care visits and preventive care for free, even if you have not yet met your deductible.

You will also see insurance brands associated with the care levels. Some large national brands include Aetna, Blue Cross Blue Shield, Cigna, Humana, Kaiser, and United.

Each insurance brand may offer one or more of these four common types of plans:

Take a minute to learn how these plans differ. Being familiar with the plan types can help you pick one to fit your budget and meet your health care needs. To learn the specifics about a brand’s particular health plan, look at its summary of benefits.

Health Maintenance Organization (HMO)

An HMO delivers all health services through a network of healthcare providers and facilities. With an HMO, you may have:

  • The least freedom to choose your health care providers
  • The least amount of paperwork compared to other plans
  • A primary care doctor to manage your care and refer you to specialists when you need one so the care is covered by the health plan; most HMOs will require a referral before you can see a specialist.

What doctors you can see. Any in your HMO’s network. If you see a doctor who is not in the network, you’ll may have to pay the full bill yourself. Emergency services at an out-of-network hospital must be covered at in-network rates, but non-participating can doctors who treat you in the hospital can bill you.

  • 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)

With a PPO, you may have:

  • A moderate amount of freedom to choose your health care providers — more than an HMO; you do not have to get a referral from a primary care doctor to see a specialist.
  • Higher out-of-pocket costs if you see out-of-network doctors vs. in-network providers
  • More paperwork than with other plans if you see out-of-network providers

What doctors you can see. Any in the PPO’s network; you can see out-of-network doctors, but you’ll pay more.

  • 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 you have to file a claim to get the PPO plan to pay you back.

Exclusive Provider Organization (EPO)

Exclusive Provider Organization (EPO)

With an EPO, you may have:

  • A moderate amount of freedom to choose your health care providers — more than an HMO; you do not have to get a referral from a primary care doctor to see a specialist.
  • No coverage for out-of-network providers; if you see a provider that is not in your plan’s network – other than in an emergency – you will have to pay the full cost yourself.
  • Lower premium than a PPO offered by the same insurer

What doctors you can see. Any in the EPO’s network; there is no coverage for out-of-network providers.

  • 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.

Point-of-Service Plan (POS)

A POS plan blends features of an HMO with a PPO. With POS plan, you may have:

  • More freedom to choose your health care providers than you would in an HMO
  • A moderate amount of paperwork if you see out-of-network providers
  • A primary care doctor who coordinates your care and who refers you to specialists

What doctors you can see. 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.

  • 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 pay you back.

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:

  • Lower premium
  • 3 primary care visits before the deductible applies
  • Free preventive care, even if you haven’t met the deductible

What doctors you can see. Any in the plan’s network; individual plans may have additional rules on specialists.

  • 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.

Paperwork involved. You will want to keep track of your medical expenses to show you have met the deductible.

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

Similar to a catastrophic plan, you may be able to pay less for your insurance with a high-deductible health plan (HDHP). With an HDHP, you may have:

  • One of these types of health plans: HMO, PPO, EPO, or POS
  • Higher out-of-pocket costs than many types of plans; like other plans, if you reach the maximum out-of-pocket amount, the plan pays 100% of your care.
  • A health savings account (HSA) to help pay for your care; the money you put in an HSA is not taxed and can be used tax-free on eligible medical expenses. In order to have a HSA, you must be enrolled in a HDHP.
  • Many bronze plans may qualify as HDHPs depending on the deductible (see below).

W hat doctors you can see . This varies depending on the type of plan — HMO, POS, EPO, or PPO

  • 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 al 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 use money in your HSA to pay these costs.

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.

Fair Health, Inc.: “Alphabet Soup of Health Plans” and “Understanding High-Deductible Health Plans.”

The Henry J. Kaiser Family Foundation. “Health Reform FAQs: Marketplace Eligibility, Enrollment Periods, Plans and Premiums.”

Society for Human Resource Management: “For 2015, Higher Limits for HSA Contributions and Deductibles.”

Internal Revenue Service.

Life and Health Insurance Foundation for Education: “What are the Different Types?”

Minnesota Medicine, February 2011: “Five Payment Models: The Pros, the Cons, the Potential.”

Office of Personnel Management: “Healthcare Plan Information” and “2013 High-Deductible Health Plans with Health Savings Accounts/Health Reimbursement Arrangements.”

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