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With
today's complicated and constantly changing health insurance system, it
is no wonder that many people are confused. Back in the good old days,
most health insurance plans were what is known as fee-for-service or
traditional indemnity plans: you visited a health care provider of your
choosing, who then submitted a claim to your insurance company to
receive payment. Nowadays, skyrocketing health care costs have caused
these types of plans to become increasingly rare and most people who
receive health insurance through their employer are in what is known as
a managed care plan. In a managed care model, health insurance
companies sign contracts with certain doctors and hospitals to provide
care for their plan members at contracted rates. While this type of
system may help manage health insurance costs, managing to understand
the system as a consumer can be difficult. How do managed care plans differ? The most common managed care plans include health maintenance organizations (HMOs), preferred provider organizations (PPOs) and point-of-service (POS) plans. HMO Plan In an HMO plan, the member (that would be you) is given a list of doctors from which to select a primary care physician, or PCP. The PCP is responsible for coordinating your care, which usually means that you must get a referral from him or her in order to visit a specialist. Some HMOs cover the entire cost of visits to PCPs and specialists; others require a co-payment from you, which generally ranges between $10-$20 dollars. An important distinction between HMOs and other types of managed care plans is that, in an HMO, if you visit a provider who is not in the plan, your insurance will not cover any portion of that provider?s fees and you will be responsible for these charges. In Texas, an HMO member may visit an OB/GYN without prior approval by a PCP. PPO Plan PPOs are a cross between HMOs and traditional indemnity plans. As in an HMO, the insurance company contracts with panels of providers who agree to provide medical care and be paid according to a negotiated fee schedule. The PPO member, however, does not need a referral from a gatekeeper, such as a PCP, to visit a specialist. Visits to doctors within the PPO network generally require a co-payment from the member. There may also be a deductible that the member must meet before services are covered; after the deductible is met, the insurer will either cover charges at 100% or at a different percentage (which can vary by plan as well as by type of service rendered). If the percentage of coverage is less than 100%, the member is responsible for the balance of the charges, this amount is known as coinsurance. Unlike HMO members, PPO members have the option of using doctors outside the plan's network. However, they may have to meet a higher deductible and pay coinsurance based on higher charges. In addition, the PPO member may be required to pay the difference between what the provider charges and the fee that the plan will pay. POS Plan POS plans also utilize a network of providers. As with HMOs, POS plans require members to select a PCP or other gatekeeper who controls referrals to medical specialists. However, the POS plan resembles a PPO in that if members refer themselves outside the plan, they will still receive coverage but may pay significantly higher deductibles or coinsurance. Benefiting from your plan's benefits: Virtually all managed health care plans provide basic medical coverage, but can vary greatly in other areas of coverage, such as hospitalization and emergency care, prescription drugs, and vision and dental care. You should review the benefits offered by your plan before you need them, and certainly before obtaining services that may not be covered under your plan. Many managed care companies have Web sites where you can review your coverage, and virtually all have a phone line staffed by customer service representatives whose sole job is to answer your benefits questions make use of them! References: http://www.ahcpr.gov/consumer/hlthpln1.htm#benefits http://www.reganinc.com/Quotes/healthtext.htm http://familydoctor.org/734.xml http://www.allhealth.org/sourcebook2002/ch11_1.html http://www.healthinsurance.org/insterms.html#co-insurance |
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