Health Insurance – What Are Your Options?
There are many options open to you if you are shopping for health insurance. Some will save you a lot of cash with a few compromises while others will cost you a lot with a lot of added value. Which you choose will depend on your health care needs and the size of your purse. Let’s take a look at your options…
You have two main options: Traditional health insurance and managed care coverage…
Traditional health insurance: This is plain insurance coverage. You choose your health care providers. That is, your insurer does NOT choose your doctor. They also do NOT choose a hospital for you to use. Under this arrangement, you might have to pay your bills and then submit your bills to your insurer for reimbursement. On the other hand, the health care provider could also submit the bills directly to your insurer and await payment.
With traditional health insurance, you have the greatest flexibility in your choice of health care provider. However, you also pay a lot higher than you would with managed care plans.
Managed Care Coverage: This comes in different variations. However, they have a few things in common. They combine the delivery and financing of health care services. This means you are somewhat restricted to a network of health care providers. However, you also get to pay far less.
Following are the various forms of managed care plans…
1. HMO or Health Maintenance Organizations have health care providers that are contracted to them. Members pay a monthly amount for which they have access to health care services within the HMO’s network of providers. There is usually a predetermined copayment for seeing a doctor, emergency room visits and prescription drugs. Members must use only providers contracted by their HMO.
2. PPO or Preferred Provider Organization. This is where a traditional insurance company contracts with a group of health care providers to reduce the cost of health care delivery to its members. The incentive for the providers is that they get prompt payments and have a greater number of patients.
Members choose the health care provider they prefer. However, they’ll usually pay more if such a provider is NOT in contract with the PPO.
3. EPO or Exclusive Provider Organization. Like the above, is an arrangement by a traditional health insurance carrier with a group of health care providers. However, unlike a PPO, members of an EPO must use only health care providers that are in contract with the EPO.