When choosing a Health insurance program, it’s all too easy to drown in an alphabet soup of acronyms — everything from ACOs (Accountable Care Organizations) to WHRN (Whole Health Resources Networks). However, the three most common types of managed health care plans are Health Maintenance Organizations (HMOs), Preferred Provider Plans (PPOs), and POS (Point of Service plans). Here’s an overview of how each type works, together with their advantages and disadvantages.
Health Maintenance Organizations. An HMO offers a “provider network” of health services professionals (physicians, nurses, therapists, etc.) and facilities (hospitals, clinics, medical offices, and so forth). A primary care physician (PCP) will act as a “gatekeeper” who will evaluate your health and recommend referrals to specialists, as needed.
As a rule, premiums and co-pays are relatively low, saving you money. On the downside, HMOs offer limited, if any, flexibility for services outside the plan. If your current physician isn’t in the HMO, you’ll have to pay for his or her services, or select another PCP who does participate in the plan. Also, if you use a provider outside the network, you’ll have to pay out of pocket.
Preferred Provider Organizations. Like HMOs, PPOs operate through a network of health care providers and institutions, and set relatively low co-payments for medical treatment. However, unlike HMOs, they’ll pick up the tab for many (although not all) medical services outside the network. What’s more, you can see specialists who participate in the network without going through your primary care physician.
Of course, you’ll pay a relatively high premium for enjoying this added flexibility. Also, if you get treatment outside the PPO, you’ll have to pick up a deductible or the difference between the charges of the plan provider and those of the out-of -network specialist.
Point of Service Plans. This option combines elements of HMOs and PPOs. A POS plan focuses on a primary care physician participating in the plan who monitors your health care at the “point of service” and recommend referrals either inside or outside the network. In the former case, the PPO will file a claim with your Health insurance company, which will pick up the tab for a high percentage of the charges; in the latter, you’ll have to do the paperwork yourself and your reimbursement will be far lower. If you see a specialist without going through your PCP, the insurer will pay even less.
As a rule of thumb, a POS offer more flexibility than an HMO and less than a PPO.
The Bottom Line. HMO, PPO, or POS — which will provide the best value for your health-care dollar? That depends on your needs and life situation. Our professionals stand ready to offer you their expert advice. Just give us a call.
