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Health
Insurance Basics
There are numerous plans,
coverages and options you can
tailor to your needs. The
sections below outline the common
Types of Policies and Policy
Options. It's a good idea to work
with an agent to help you create
a benefits package that's right
for you. When you are finished
reading this section, click
here
to request a quote from an
experienced agent.
Types of Policies
Each plan differs in coverage,
payment terms and medical
treatment procedures (i.e.
available doctors). Below is a
list of common policies:
Indemnity
(Fee-for-service): allows you to
go to any hospital or doctor. You
submit a claim and pay the
invoice (to be reimbursed later)
or authorize the hospital or
doctor to collect their fees
directly from your insurance
company. Although this plan is
very flexible in who provides
your care, the premiums are
higher than other types of health
insurance. Also, indemnity plans
usually do not provide any
coverage until the deductible has
been satisfied.
PPO (Preferred Provider
Organization): the insurance
company has a network of
"preferred providers"
(hospitals, doctors, clinics,
etc.). These providers discount
their service fees to your
insurance company in exchange for
being part of the network. If you
use a provider from outside the
network, you'll have to submit a
claim and likely pay a higher
deductible. This is usually
cheaper but not as flexible as
the indemnity plan.
HMO (Health Maintenance
Organization): all your medical
services are provided by the
organization of doctors,
hospitals, etc. The HMO is much
like a strict PPO: you must use
the providers they authorize
(except for emergencies as
defined by your plan). Your
doctor refers you to other
doctors within the HMO as
necessary. The HMO's advantage is
that it has no deductibles and
usually requires only a small
co-payment for each service.
There may also be a maximum to
what you pay annually
"out-of-pocket."
POS (Point-Of-Service):
this is an option of HMO with
greater flexibility. Your primary
doctor may refer you to someone
outside of the HMO with minimal
or no additional cost. You may
also refer yourself to a non-HMO
provider, but you'll have to pay
co-insurance.
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