Today in the United States, Managed Care Plans have become the most popular form of health care coverage. Managed Care Plans are very different from Indemnity Plans. Under an Indemnity Plan, a policy holder can seek medical attention whenever and wherever it is essential. With a Managed Care Plan, a policy holder has many limitations and restrictions.
Managed care plans have become so common because these plans are what most employers offer to their employees. Employers bear the cost of their employees’ medical coverage. For employers, medical benefits to the employers happen to be their biggest expense. Thus, employers tend to opt for the most economical of health plans to provide their employees. Managed care plans are the most economical type of health insurance plan for employers.
It is a fact that medical expenses can be controlled if access to health treatments and services is controlled. Managed care plans uphold this truth, which is beneficial for companies offering medical benefits to employees. However, if viewed from a patient’s perspective, if one is in need of a treatment that goes beyond the basic preventive care, availing of such a treatment can become difficult.
Managed care plans categories are as follows: a Health Maintenance Organization (HMO), a Preferred Provider Organization (PPO); and a Point of Service (POS). HMOs and PPOs are the most popular. A brief about the features of each is given below:
A Health Maintenance Organization (HMO) plan is more economical than a PPO and offers coverage for preventive care. If you are an HMO participant, you pay a monthly premium and very minor co-payment whenever you visit a doctor. The HMO network has many medical care providers. You have to choose from these medical care providers. The medical care providers have an agreement with the insurance company to offer medical services at already negotiated and reduced rates. You must select a Primary Care Physician (PCP), who will always be the first to examine you each time you have a medical condition. Your PCP will give a referral if you need to see a specialist for your condition.
As an HMO participant, you can only choose a PCP from your HMO’s approved list of medical care providers. It’s possible that your preferred doctor won’t be on that list. The costs of a medical care provider who is not in your HMOs network won’t be covered by the HMO. Also, in most cases the HMO network is small in size, so getting appointment with a PCP can be difficult.
A Preferred Provider Organization or PPO is very much like an HMO. The only difference is that with a PPO plan, you don’t need to be examined by a PCP first. Although not required, you are advised to select a medical care provider from the PPO’s approved list. If you should ever need to go to a specialist, you don’t need to have a referral. If you visit a medical care provider outside your PPO’s network, the co-payment is higher and the PPO part of medical care will be less.
PPOs do offer more amount of freedom but the costs involved are higher. These costs can be exceptionally high when you seek the services of a medical care provider outside the network of PPO.
A POS managed care plan is mix of HMO and PPO. It offers more freedom to choose a medical care provider and has lower costs. You can choose a PCP, but it is difficult to get a referral to a specialist. If you stick to the network, the paperwork is negligible and your co-payment amounts will also be at aminimum. A POS plan has no deductibles. This might make a POS plan appear lucrative, but POS plans are not very popular.
You have do a thorough research and analysis regarding which managed care plan to choose. The plan should satisfy your needs. The coverage provisions and additional costs differ significantly from plan to plan, so do invest time and put effort and clarify your doubts as soon as possible.
