When you're shopping for your own health coverage, you don't have to settle for whatever your employer thinks is best. You get the advantage of choosing the right plan for you.
What are PPO's?
PPO's, also commonly referred to as preferred provider organizations, are a specific type of health insurance system that are designed to provide a greater discount than others because clients must choose from a selected group of health care providers.
These health care providers can include everything from individual doctors to entire hospitals, care centers, and so on. By enrolling in a preferred provider organization you gain access to a significant decrease in the cost of medical services, but you are also restricted to accessing a certain group of providers.
Here, we'll take a look at some of the advantages and drawbacks of using preferred provider organizations, as well as how they are different from other types of plans, in order to help you decide what is right for you.
The main attraction to PPO's is the discount on medical services that clients receive. Essentially, when you sign of up for a preferred provider organization, you are given a list of different health care services you can access.
Whenever you require medical attention from one of the providers on that list, your organization will pay the service costs. The organization makes money by charging an access fee for their network, which generally comes in the form of monthly or annual charges. The providers negotiate with health services in order to provide clients with greatly reduced costs.
The major drawback of PPO's is that they restrict where you can receive the discount. If you visit a health care provider outside their network, the organization will not pay the service costs. This is what sets preferred provider organizations apart from other health insurance policies, such as fee for service or indemnity plans, where you are able to visit any health service center but have to pay a greater fee.
Essentially, PPO's are a good choice for those who do not have to visit specialists outside of the organization for health care. Most providers will make themselves more competitive by offering a wide range of health services, thereby allowing clients to get a variety of healthcare without having to leave the network and pay higher costs.
If you regularly visit the same health care center and that center is part of a preferred provider organization, then joining that PPO will likely greatly reduce your health service costs. Balancing your income, level of personal health, and other factors to decide whether you can stay on the network in exchange for the discount is important.
What are HMO Insurance Plans?
Health management organizations, commonly abbreviated as HMO's, are a type of health insurance policy. They are one of three major types of managed health care plan, as opposed to an indemnity or fee for service plan. In this article, we'll take a look at some of the pros and cons of having a health management organization policy, and how they differ from other managed health care plans and indemnity plans.
HMO's are essentially networks of health care providers such as individual doctors and hospitals. When a client receives health care from within this network he or she receives it at a great discount. This treatment is made on a pre paid basis, meaning that instead of paying for treatment, you pay an annual or monthly fee for being a member of the network.
Your monthly or annual fee is completely separate from the amount and cost of the health care you receive, meaning that no matter how much treatment you require you do not need to pay more. This plan differs from traditional indemnity plans, where you pay a fraction of the treatment costs whenever you require medical attention.
The reason you are able to receive a greater discount with HMO's than with indemnity insurance plans is that you must receive treatment from one of the networkęs health care providers. If you get treated at a health care center that is not a member of the network, the insurance will not apply, or if it does it will be at a greatly reduced discount.
The advantages of health management organizations are basically lower out of pocket costs, a focus on wellness and preventative care, and no maximum lifetime payout. The disadvantages include tighter controls that make it more difficult to get specialized care (you must choose a primary physician who must then refer you to any specialists you need to see), and that care from non-HMO physicians is usually not covered by the insurance policy.
If you are looking for general healthcare for a lower overall cost, HMOęs are a good way to go. If you are at risk for rare illnesses that non-networked specialists may be required to treat, an HMO might not be able to cover the costs of that treatment. Therefore, balancing your specific needs with the type of health care available from health management organizations is a good way to save money and live healthier.
