Types Of Managed Care Plans

By Author: Marcus Stalder
Total Articles: 491
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People ask a lot of questions regarding different plan types. Some want the cheapest option out there, others seek the best flexibility possible. Fortunately for most customers, there are different health plan types that have their pros and cons in order to meet the needs of different customer groups. These days almost all insurance companies provide managed care plans of different types in contrast to the indemnity insurance plans that were the standard in the past. Managed care plans are much cheaper and provide more options to the customer than indemnity plans, that's why the latter aren't as popular and widely spread. But there are different types of managed care plans and depending on which type you choose there can be a totally different set of benefits you can get with your insurance coverage. So in order to make it easier for you to choose the right type of managed care plans here is a brief description of each type:

Health Maintenance Organization (HMO)

This is the most popular type of managed care plans and is usually the cheapest one, Under a HMO plan you have to choose a primary care physician (PCP) ...
... who will handle all your medical services and refer you to any specialists if necessary. You can't get coverage if you go to the specialist directly or receive services in a facility out of the network indicated in the plan. There's usually a set of standard services that you can get under HMO under full coverage including regular checkups, lab exams, X-rays and others. So it's a pretty restrictive form of managed health insurance but it costs much less in premiums than other types of managed care plans.

Preferred Provider Organization (PPO)

With PPO plans you get more flexibility in choosing the specialist you want to get services from. You are not required to select a PCP and can go directly to the doctor you need. But you are still limited to a specific network of medical facilities you can get services from. Still, you can choose to receive services from an out-of-network specialist or facility, only your costs will be covered to a much lesser extent than with an in-network specialist. PPO provides more freedom in choosing where to get help from, but this freedom comes for a price as such plans usually have higher premiums than HMO health insurance.

Point Of Service (POS)

POS plans are often regarded as a mix between PPO and HMO plans. On one hand you have more flexibility in choosing where to get your services. On the other hand you are still required to choose a PCP. Only in case of a POS plan you can choose a physician that is outside the preferred network of service providers. This is particularly useful if you have a good family doctor that you don't want to switch and they aren't making a part of the preferred network.

Knowing the difference between managed care plan types it will be easier for you to select the one that will serve your interests best and provide you with cheap health coverage that most of us really need these days.