There are many types of health insurance plans:
- Managed Care Plans: Health Maintenance Organizations (HMOs), Point of Service (POS) Plans, Preferred Provider Plans (PPOs)
- Fee-for-service plans
- Coverage for catastrophic illnesses
- Savings accounts for medical expenses
- Medical indemnity policies
- Cancer insurance and other supplemental insurance
All of these plans require you to pay a monthly fee, referred to as the premium. Most also require you to pay either a flat fee for doctor visits and other services (known as a copay), or a percentage of the cost (referred to as coinsurance ). Some services require you to pay a copay and coinsurance. Each year, most people also pay a certain amount of their health care costs (known as the deductible ) before their insurance begins to cover their medical expenses. Once you’ve met your deductible, your insurance will pay a set percentage of your health care bills for the rest of the year.
Deductible: The amount you must pay each year for health services before the health plan pays for anything.
Copays – The amount you must pay at the time you go for a service, usually a flat fee each time you visit the doctor or receive other services. They are sometimes confused with coinsurance, but they are not the same thing.
Coinsurance – A percentage of each medical bill that you must pay, even after you have paid the annual deductible amount.
If your doctor accepts your health plan, often the office will bill the insurer, and then bill you for the amount your health insurance doesn’t cover. If not, you may have to pay your medical bills and then complete the forms and submit them to the insurance company to be reimbursed for your health care expenses.
You must keep track of your medical expenses and the payments made by you and your insurance company. These records can be of great help to you in the event of a dispute over your payments or other problems in the future.
The health plans are briefly explained below. Although we are going to describe the types of health plans that you can find in the private sector (plans provided by employers and individual insurance plans), many of the plans sponsored by the government use some of the same approaches and terms as private plans.
It’s important to know that some health plans may not cover all of your health care needs. Here are some things to consider when selecting a plan:
- Verify that the plan is classified as a Qualified Health Plan.
- Confirm that your doctors, specialists, and pharmacies are part of the new provider network. If not, check the costs for services from out-of-network providers.
- Confirm that your current medications are covered in the plan’s drug formulary.
- Review all health care services covered by the plan, as well as services that are excluded and limited in coverage.
Every health plan is different, but some of the commonly excluded and limited coverage services include unproven and experimental cancer therapies, acupuncture, homeopathic or herbal medicines, long-term care, private duty nursing, drugs or services that are not prescription drugs, equipment, and supplies that may not be medically necessary for your health care.
Health insurance scams are everywhere
Be on the lookout for health insurance scams (advertisements or agents offering discount medical cards, or “government-sponsored” and therefore very low-cost health insurance). There are also “insurance specialists” or “government agents” who call and ask for personal data or credit and banking information. These scammers operate online, over the phone, and door-to-door.
Managed Care Plans
These types of plans typically coordinate or manage the health care of enrollees. There are several types of managed care plans. some plans, such as health maintenance organizations (HMOs), have a more limited network of providers and hospitals, while other models, such as preferred provider organizations (PPOs), have a network of providers more spacious.
Not only health insurance companies, but many different types of institutions and agencies also sponsor managed care plans. These include employers, hospitals, unions, consumer groups, and the government, among others. It’s helpful to know the details of the plan and how it affects your health care. The most common types of managed care plans are:
- Health Maintenance Organizations (HMOs)
- Point of Service Plans
- Preferred Provider Plans
Most managed care plans have lower premiums, copays, and/or coinsurance than traditional fee-for-service insurance. Premium, copay and coinsurance amounts can vary between managed care companies, and even between different services within a single company. In general, it is not required to process claim forms.
Some managed care plans require their members to use a primary care provider who coordinates all of a patient’s care and has the role of directing care to other specialists. This referring physician is typically a primary care physician responsible for the patient’s overall medical care, arranging and approving medical treatments, tests, referrals to specialists, and hospitalizations. For example, if you need to see a doctor who specializes in the lungs, you must have a referral from your primary care doctor before the specialist can see you. Otherwise, your plan may not pay for the service.
In most plans, members must only use the services of certain health care providers and institutions with whom they have agreements. These plans may require members to choose providers from a particular provider list or network. When you choose to receive care from an out-of-network provider, you often pay more or even pay the entire bill without help from your health plan. Some of these plans will require you to pay at least part of the cost of seeing someone outside of the network.