Sunday, November 13, 2011

Health Insurance Types - HMO And PPO - Pros And Cons

When it comes to categorizing health insurance plans we use the term indemnity insurance and managed care insurance. Before we explore and compare these types of plans, we want to mention here that all insurance plans share the same fundamental similarities. For instance, all health plans have the characteristic of monthly, quarterly or yearly premiums which can be paid either by cash, check, and credit or debit card or automatically through bank draft. These payments vary by plan, age of the insured, features included in the plan and also if the insured has any pre-existing health. In addition, there are often other payments you must make, which will vary by plan. Most health insurance plans are also characterized by certain out-of-pocket costs such as a co-pay. A co-pay is the amount that the insured pays up-front while at a doctor's visit. Co-pays also vary depending on the patient and the nature of the doctor's visit.

Indemnity Care

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This type of insurance plan offers a wider variety of doctors and specialists. There is also more variety to choose from as far as hospitals. Patients who are covered under Indemnity plans are billed for any out-of-pocket costs accrued from their doctors' visits and other incidental charges only after those charges have been incurred and billed.

Managed care plans

These health care plans consist of working arrangements that a group of doctors, hospitals, and health care providers who come together to give health care to their members at discounted costs. These providers have a huge variety of doctors, specialists and hospitals to choose from and this choice can easily be made by just entering one's zip code into their website and all the doctors participating in the plan will be displayed. For psychotherapy updates need to be provided by the therapist and sessions are given out in groups requiring more requests.

Managed care plans are also renowned for offering excellent care at discounted rates. The members pay a low co-pay, usually somewhere between and .00. The co-pay for dental and vision care co-pays are usually slightly more costly and may range into the hundreds of dollars even thought the care itself is still at a reduced cost.

Another advantage accrued by managed care members is that they have less paperwork to deal with. Recent technological developments within the managed care system have automated most basic tasks and members can fill out all the necessary paperwork right on the Internet. This is very convenient and saves time for both the managed care provider and the member.

There are two main types of managed care plans: HMOs and PPOs

HMOs- (Health Maintenance Organization) This type of managed care works through a group of doctors, medical personnel and facilities and these works directly for the HMO. Each patient is supposed to pick their doctor, known as a primary care physician or PCP, who becomes the patient's point of reference for all the patient's health care needs. HMO patients experience lower premiums primarily because the cost of care is spread out among all the members. As we mentioned earlier, HMO members also have less paperwork to deal with because everything is automated online.

A downside of HMOs is that the patients have to get their primary physician's referral ("permission") before they can see a specialist. This may be risky if the patient is in an emergency situation because it wastes time.

PPOs-Participating Provider Organization or Preferred Provider Organization, is a type of health care plan which is very similar to HMO in that the doctors, hospitals and health care providers have joined together to provide managed care at discounted. Their logic is revolves around the fact that they can charge less and therefore get more patients who are attracted by the low prices.

The idea of a preferred provider organization is that the providers will provide the insured members of the group a substantial discount below their regularly-charged rates. This will be mutually beneficial in theory, as the insurer The PPOs work by negotiating with health care providers to handle disputes between insurers and providers ad deal with all fee issues. It is important to compare for your area to see what the premiums are as well as providers and what is included.

Health Insurance Types - HMO And PPO - Pros And Cons

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