Health insurance plan & network types: HMOs, PPOs, and more. Insight into what makes a network and how to choose the right one for your needs. So what is a health insurance network? Your monthly premiums are paid to your chosen insurance company. They in turn, negotiate with work in partnership with actual service providers, doctors, consultants and carers for example to create a network. Within that network you can be sure of the services covered by your plan at fixed prices.
When you use providers within the network, the fixed prices will keep your co-insurances and co-shares to a minimum.
How are the networks organized?
There are two main categories
1. Health maintenance organization (HMO)
2. Preferred provider organization (PPO)
And two further plan types which combine features of these two. They are:
3. Exclusive provider organization (EPO)
4. Point of service organizations (POS)
In broad terms these categories describe the degree of flexibility you have when choosing your service provider. As you might expect the premium cost rises with the range of options.
For most families, HMO is entirely appropriate. For some, the ultimate flexibility of a Preferred Provider Organization (PPO) may be a necessity.
Between the two sits the Exclusive Provider Organisation (EPO) plans which combine the essential features of HMO plans with some of the options offered by PPO.
Make sure you understand the difference between the plans – AND the alternative options.
Health Maintenance Organization (HMO)
You will be asked to choose a Primary Care Physician (PCP) who MUST be in network. All your care will be coordinated by your PCP including referrals to a specialist who will also be in-network.
Typical HMO plans have lower premiums than other private health insurances but do not cover out-of-network health care costs.
Preferred Provider Organization (PPO)
PPO plans give you the most options to access the healthcare services you need. You have access to your in network physician (partnered with your chosen insurer) and if needed, to out-of-network doctors (possibly at a higher cost)
You may choose to have a Primary Care Physician (required in some States, e.g. CA) but you will not need a referral to see a specialist.
You can expect PPO plans to have higher premiums but in many cases the cost is offset by the convenience especially if you have dependents in different states or foresee the need to travel inter-state or abroad.
Can I mix and match to suit my circumstances?
Two of the more common plans are Exclusive Provider Organization (EPO) & Point of Service (POS)
EPO plans allow you the option to consult a specialist, subject to the terms of your plan, without needing a referral from your PCP but EPO plans do not cover out-of-network physicians.
POS is a further option which allows you to combine elements of HMO and PPO.
Point of service plans provide the value associated with HMO but offer the flexibility of out-of-network service provision. Out-of-network services may be more expensive, but your coverage gives you the choice.
Health insurance is a major decision for all US citizens. Failure to insure can have catastrophic outcomes.
The ACA, through the Health Insurance Marketplace, either the Government exchanges or Private health exchanges ensures that healthcare is affordable and accessible.
On exchange, the plans described above are available at all levels of cost sharing, Bronze, Silver, Gold, and Platinum.
Whatever your choice of plan, you will benefit from premium tax credit and your out of pocket expense will be limited.
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