Question

What are the Typical example of reimbursement in a traditional indemnity plan [deductibles, coinsurance, etc]?

what is Managed care plans – HMOs, PPOs.

Differences between HMOs and traditional indemnity plans – ‘providers at risk’ is the key.

what is the Structure of a typical HMO.

Nature of PPOs – how PPOs are different from HMOs, Consumer Driven Health Plans and HSAs.

Answer 1

POS plans are a hybrid of PPO and HMOs. In fact, point of service means that the health care consumer gets to choose whether to use HMO or PPO services each time you see a provider. ... You have a PCP in the POS plan.Oct 23, 2018

PPO stands for preferred-provider organization. Premiums and deductibles are usually much higher for a PPO compared to an HMO, but that comes with greater flexibility.

About one-half of enrollees in employer-based health plans are in a PPO. Though it remains the most utilized type of plan, the number has been falling in recent years as employers turn more to HDHPs as a way to contain health care costs.

You usually don’t have to select a primary care provider (PCP) in a PPO plan, and you can choose from more healthcare providers than an HMO because PPO networks are usually larger. PPOs allow you to get both in-network and out-of-network care -- though out-of-network providers will cost you more. You can also see a specialist without a referral.

Though a PPO gives you more independence, this doesn’t mean that you have complete access to the health care system without any oversight. A health plan may still require you and a physician to get approval for a costly service, such as an MRI. That's called a prior authorization, which has become common in health care.

In addition to higher premiums, PPOs usually have a deductible that you have to meet before the health plan pays for care.

Kaiser Family Foundation reports the average deductible for an individual PPO plan is $1,204. Once you’ve reached your deductible, your insurer begins to pick up its portion of the coinsurance.

The plans also include an out-of-pocket maximum for in-network care. If you reach your out-of-pocket maximum, all costs are covered by your insurer. A plan’s out-of-pocket maximum can vary widely, so you’ll need to check to see the out-of-pocket maximum for your plan. For Marketplace plans through Obamacare, the maximum out-of-pocket limits for 2018 are $7,350 for an individual plan and $14,700 for a family plan.

The main benefit of a PPO is flexibility, but it does come at the cost of higher premiums and a deductible that you will have to pay before your insurer starts paying for care.

When a PPO might be right for you:

You want the flexibility to go out of network and not need to get referrals.Flexibility is more important to you than paying higher premiums.You would rather pay higher premiums, but likely pay less for the health care services.

What kind of person should opt for a PPO: Someone who utilizes health care regularly and sees specialists or wants to have the option to see a specialist without getting a referral.

HMO stands for health maintenance organization and makes up 16 percent of health plans. It is known for its lower premiums and restricted network of doctors and hospitals, which means you sacrifice flexibility for lower upfront costs.




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What is the difference between HMO, PPO, HDHP, POS, EPO?

10 min read

October 23, 2018

By Les Masterson

Which health insurance plan is best for you?

The answer to that question really depends on a number of factors that pertain to your specific situation. When comparing health plan options, take these factors into account:

Your healthYour family’s healthYour health care providers and whether they accept the insuranceYour financial situationWhether you want to pay more upfront via premiumsIf you want flexibility and not having to ask for referrals to see a specialist

Once you review those factors, choosing a health plan is much easier.

The five most common types of health insurance plans are:

Preferred provider organizations (PPOs)Health maintenance organizations (HMOs)High deductible health plans (HDHPs)Point of service plans (POS)Exclusive provider organization plans (EPO)

The two most common health plans have been generally HMOs and PPOs, but HDHPs have become a lower-cost health insurance option for employers over the past decade. POS and EPO plans are options provided by some employers and health insurers, but they’re not nearly as common as HMOs, PPOs and HDHPs.

In this guide, we provide information about each of these plans to help you make the right decision for your circumstances. We will go through each of the five plan types and highlight the differences:

What is a PPO?What is an HMO?What is an HDHP?What is a POS?What is an EPO?What is the difference between HMO, PPO, HDHP, POS and EPO?

What is a PPO?

PPO stands for preferred-provider organization. Premiums and deductibles are usually much higher for a PPO compared to an HMO, but that comes with greater flexibility.

About one-half of enrollees in employer-based health plans are in a PPO. Though it remains the most utilized type of plan, the number has been falling in recent years as employers turn more to HDHPs as a way to contain health care costs.

You usually don’t have to select a primary care provider (PCP) in a PPO plan, and you can choose from more healthcare providers than an HMO because PPO networks are usually larger. PPOs allow you to get both in-network and out-of-network care -- though out-of-network providers will cost you more. You can also see a specialist without a referral.

Though a PPO gives you more independence, this doesn’t mean that you have complete access to the health care system without any oversight. A health plan may still require you and a physician to get approval for a costly service, such as an MRI. That's called a prior authorization, which has become common in health care.

In addition to higher premiums, PPOs usually have a deductible that you have to meet before the health plan pays for care.

Kaiser Family Foundation reports the average deductible for an individual PPO plan is $1,204. Once you’ve reached your deductible, your insurer begins to pick up its portion of the coinsurance.

The plans also include an out-of-pocket maximum for in-network care. If you reach your out-of-pocket maximum, all costs are covered by your insurer. A plan’s out-of-pocket maximum can vary widely, so you’ll need to check to see the out-of-pocket maximum for your plan. For Marketplace plans through Obamacare, the maximum out-of-pocket limits for 2018 are $7,350 for an individual plan and $14,700 for a family plan.

The main benefit of a PPO is flexibility, but it does come at the cost of higher premiums and a deductible that you will have to pay before your insurer starts paying for care.

When a PPO might be right for you:

You want the flexibility to go out of network and not need to get referrals.Flexibility is more important to you than paying higher premiums.You would rather pay higher premiums, but likely pay less for the health care services.

What kind of person should opt for a PPO: Someone who utilizes health care regularly and sees specialists or wants to have the option to see a specialist without getting a referral.

What is an HMO?

HMO stands for health maintenance organization and makes up 16 percent of health plans. It is known for its lower premiums and restricted network of doctors and hospitals, which means you sacrifice flexibility for lower upfront costs.

You’ll likely pay less in premiums for an HMO compared to a PPO – sometimes significantly less.

HMOs require that you name a PCP who “coordinates” care, meaning your primary doctor must refer you first in order to see a specialist. HMOs usually don’t have deductibles (or they are lower than other plans). Instead, you pay copays for office visits, tests and prescriptions.

These plans usually have lower deductibles than PPOs. The average deductible for individual coverage is $870.

One drawback to an HMO is that these plans usually don’t allow you to go outside your network for care. If you do, you’ll need to pay for the care on your own. An exception is if you need emergency care, which requires the facility (but not necessarily the providers) to bill as in network.

Not all providers accept HMOs, so before choosing an HMO, make sure your provider or providers accept the plan.

When an HMO might be right for you:

You have a primary care physician and other providers who are in the HMO network.You don’t see many specialists and don’t need referrals often.You don’t mind the limitations of only seeing providers in your network.Cost is more important to you than flexibility.

What kind of person should opt for a HMO: Someone who wants to pay as little as possible in premiums though not have to face high deductibles. An HMO could be a good option if you have a PCP and your other health care providers are already in the HMO.

It’s open enrollment season at your job and your employer offers you a choice between the three biggest plan types: HMO, PPO and HDHP. Which is best? It really depends on your financial and medical situation – and preferences.

For instance, would you rather the flexibility of not having to go to a smaller group of providers in an HMO and don’t mind paying more upfront for your care via premiums? Then, a PPO might be right for you.

Do you not care about having a large network of providers, but paying as little as possible for health care is more important to you? Then, an HMO could be perfect.

Do you not use medical services often and you want a plan that will protect you, but not cost much in terms of upfront premiums? Then, a HDHP could be the direction to go.

Choosing the right health insurance plan is a personal decision and depends on your situation and preferences. Whether you ultimately choose a PPO, HMO, HDHP, POS or EPO, take costs, flexibility, coverage and convenience into account when making that decision.