What You Buy When You Buy Health Insurance
Although PPO stands for preferred provider organization, HMO stands for health maintenance organization, and POS stands for point of service, they have many things in common.
Managed care plans also take care of claims processing that result from a medical service. But Members can only go to certain doctors and hospitals for medical care because managed care plans provide their members with health care from within a network of providers, so the doctors have to be in that network.
A health maintenance organization generally provides the least expensive medical care. HMOs offer medical services in exchange for a fixed monthly premium. However, HMO clients have no freedom to choose their own doctors and hospitals and can only use providers in the HMO network. Doctors belonging to a particular HMO normally refer patients to other HMO doctor members, and a referral from an HMO primary care doctor is needed in order to see a specialist.
A preferred provider organization, or PPO, allows its members greater latitude in choosing which doctors they can see. Physicians within a PPO make referrals, but the members can refer themselves to doctors and specialists including those outside of the plan. However,though members have the freedom to go outside of the PPO and will still receive coverage, they will pay more for seeing providers out side of the PPO network.
Though members will pay more, In a point of service plan, doctors can refer their patients to other doctor within or outside of the plan. Members of this plan are able to pick their own doctors for medical care and can refer themselves to which ever health care provider they choose to.
In an FFS plan there is a pre-existing network of prividers already in place therefore it is not really considered a managed care plan. These plans can be much more expensive compared to PPOs or HMOs. They are able to pick who they choose to see though. The only thing that this depends on is if the providers take that type of insurance. They also usually require more out of pocket expenses because they have to pay up front and then the insurance refunds the money.
The plan you ultimately choose will depend on personal needs, whether or not you are single, married, married with children, whether or not the insurance is available in your geographical area, and of course, the amount of income available for health insurance. One very important point to remember is that health insurance, as all insurance, is protection. The better you understand the kind of protection you need, the better your choice will suit your needs.
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