Health Insurance

Health insurance offers protection in case of unexpected medical emergencies. Health insurance policy takes care of hospitalization, medical and other costs incurred. Health insurance policy is a contract between an insurance company and an individual.

Types of Health insurance

The different types of Health insurance are Health Maintenance Organization, Point-of-service, Preferred Provider Organizations and Indemnity Plans. HMO, POS and PPO are managed care plans.

Health Maintenance Organizations (HMOs): are one of many types of managed care arrangements. It is also called as "pure" managed care. In this plan you have to pay certain monthly insurance fee. Individuals who join an HMO are considered members. Members can choose a Primary care physician from the HMO list provided to him. HMOs have a network of physicians and hospitals and require members to assign a primary care physician. Primary Care Physician will provide its members health care needs. You have to make certain co-payments each time you visit a doctor. If a member needs a specialist, Primary care physician will refer the member to the specialist who is also in the HMO network. If members receive service out of network they have to pay all the expenses out-of-their-pockets.

Preferred Provider Organization (PPO): A PPO is somewhat similar to HMO. PPOs encourage members to utilize the doctors and hospitals within the network but do allow members to visit out-of-network medical service providers. PPO members have to pay both co-payment and deductible for in-network coverage. If members go out-of-network for their medical needs, they are still covered to a certain degree.

Point of Service (POS): POS plan combines both HMOs and PPOs. If members visit physicians within the network they don't have to pay any deductible and limited co-payments. Similar to PPO, Point of service plans also offer limited coverage to members who choose to go out-of-network for medical care.

Indemnity plans: An indemnity plan gives more freedom to its members than managed care plans. In this plan, they can visit doctor of their choice. There is no network of physicians involved in an indemnity plan and no restrictions. But, this plan is more expensive than managed care plans and involve more out-of-pocket expenses.

When you are selecting a health plan, remember than each plan functions differently from the next. However, only you can determine what type of medical plan best fits your health needs.