As is often the case when selecting group health insurance policies, selecting one may seem daunting and bewildering. There are several aspects to take into account such as network availability, deductible amounts and coinsurance structures that need to be addressed before making a final decision.
Your employees deserve coverage that fits their healthcare needs while still helping your business manage costs effectively. Learn about all the available plans here.
HMO
HMOs, or Health Maintenance Organizations, are health insurance plans with networks of physicians and healthcare providers who contract to offer care at set costs, often lower than traditional plans. HMOs tend to have less restrictive conditions than other plans due to requiring you to select a primary care physician who then refers you to specialists – thus restricting the choice of healthcare professionals available and making treatment difficult to access.
HMOs were once thought of as less reliable health insurance plans; but, with industry changes and consumers’ shifting tastes, HMOs have become an attractive option for many consumers. HMOs tend to feature lower monthly premiums and copays than their competitor plans while covering an array of medical services nationwide. Furthermore, many HMOs honor networks associated with them so you may even be eligible for discounts based on where you live.
HMO plans provide maximum coverage at relatively lower costs, and in exchange for a reduced monthly payment you agree to only visit those on your healthcare provider’s preferred providers list and utilize only those listed therein. You will still need to pay deductible and copays; referrals may still be necessary before seeing specialists. HMOs can be great choices for individuals who require ongoing preventive healthcare but want to reduce medical expenses by covering these services for lower copayments or sometimes completely free – ideal options for avoiding high medical bills!
All managed care health plans provide guidelines to determine what services are medically necessary, but ultimately it’s up to the individual to adhere to them; otherwise, their insurance company won’t reimburse for unnecessary services provided.
PPO
Preferred Provider Organization (PPO) plans are flexible health insurance options that offer more freedom. PPO plans typically provide lower out-of-pocket costs when visiting doctors and hospitals within your health insurance provider’s network; instead, out-of-network providers may still be covered, with them usually paying a higher percentage of service cost and leaving you to cover any remaining amount with copays or coinsurance policies.
PPO plans provide greater flexibility to use out-of-network providers than HMO or EPO plans do. While you will require a referral from your primary care provider (PCP) before seeing specialists under these plans, with PPO you don’t require having one and can go directly to specialists without waiting for approval first.
However, PPOs do have their drawbacks. Premiums tend to be more costly than HMOs and the deductible amount (the amount your employees must pay out-of-pocket before insurance begins sharing expenses with them) can often be higher.
Be mindful that a PPO does not guarantee medically necessary services. All managed care health plans have guidelines which determine what coverage exists; in the event that your physician recommends treatments not covered, your insurance provider will inform you and offer options for further consideration.
As a small business owner, it is your duty to ensure your employees are taken care of. Offering comprehensive healthcare packages is one way of attracting and retaining top talent. When selecting PPO plans for your PEO plan, keep workforce demographics and desired coverage in mind when making your choice. For assistance finding health insurance plans suitable for your company contact a trusted independent agent; they offer multiple plans designed to fit within budget while filling in gaps like cancer and accident insurance policies offered by Aflac for instance.
Fee-for-Service
Fee-for-Service (FFS) reimbursement models reimburse medical providers based on the services they render to patients, discouraging physicians from providing comprehensive and efficient care while encouraging excessive treatment, leading to rising healthcare costs as a result. It may also discourage preventive healthcare or coordination between providers; thus several experts have called for shifting away from FFS towards value-based care models which reward doctors and hospitals based on patient outcomes and efficiency rather than mere services provided.
The traditional FFS model reimburses providers for individual tests, treatments, and procedures. For instance, physicians typically charge an office visit fee as well as additional charges if an X-ray or blood test is recommended by their doctor; similarly prescription medication and referrals to specialists will incur another bill from this model; unfortunately it can result in overutilization and unnecessary procedures being done by providers.
FFS has long been the standard reimbursement model for healthcare in the US. But other payment models that may both improve quality and lower costs exist as alternatives; such as bundled payments, patient-centered medical homes and accountable care organizations. Though not widely utilized yet, such programs are currently under development. Medicare and Medicaid Services has already initiated plans to switch the country away from FFS towards Value-Based Care (VBC), where providers will be reimbursed according to how much quality care they deliver.
FFS has come under scrutiny for failing to control rising healthcare costs, since its incentive structure encourages physicians to perform additional tests, treatments, and procedures which generate revenue for them. Furthermore, its difficult comparing different treatments to determine which ones are cost-effective.
Studies have demonstrated that FFS can lower costs by restricting unnecessary services provided, thus lowering care expenses. However, FFS was never intended as a long-term solution, and other models have shown to be more cost-effective than it.
Indemnity
Indemnity refers to an agreement between two parties in which one agrees to compensate the other party for potential damages that might occur – this is often used as the foundation for most insurance policies and legal contracts; indemnity also can refer to compensation paid in lieu of filing suit against someone.
Health insurers provide indemnity plans, also referred to as fee-for-service. With these types of plans, you are able to select your own doctor and hospital while the insurance provider pays part of the bill. In general, an initial deductible payment must be met before benefits start accruing from an indemnity plan; once met, most plans cover 80 percent of what they deem the “Usual and Customary” charge for services provided whereas you will remain responsible for 20 percent (known as coinsurance).
Medical malpractice insurance provides indemnity coverage that protects physicians against lawsuits brought by patients alleging injuries from medical care or treatment provided by them. Medical malpractice coverage may be required of physicians in order to receive their license to practice medicine, while it’s also frequently seen among professionals such as lawyers, accountants, architects and engineers who could face litigation from clients should their work prove defective.
Fixed indemnity insurance pays a set amount for healthcare events such as hospital stays or visits to emergency rooms, without being subject to Affordable Care Act regulations. Such policies typically are available from insurance companies who specialize in offering them and typically are offered for limited periods of time and cost less than comprehensive plans.
