Different Types of Comprehensive Vermont Health Insurance Plans

Comprehensive Health Insurance Plans

Comprehensive health insurance is offered to Vermonters by employers or on an individual basis through a variety of insurance companies that offer different types of insurance plans. Some health insurance companies may offer only one type of plan, while others may offer some or all of them. The types of comprehensive insurance described below are shown in order of the most managed to the least managed plans.

HMOs (Health Maintenance Organizations) are also called "managed care plans." HMOs attempt to control the cost of health care by managing your care. This means that you must choose a "primary care provider" from a network of providers who have agreed to participate in your HMO. You then go to your primary care provider for all services. If your primary care provider cannot help you, he or she will give you a "referral" to go to a specialist, who must also be part of the plan's network of providers. Most HMOs require you to pay a small amount ($10 or $15 co-payment, for example) each time you have outpatient or office medical visits. Once you have paid your co-payment, the plan pays for everything else that is covered by your policy when you receive services within the HMO's provider network.

One important difference between HMOs and indemnity plans is that HMOs usually pay for preventive services, like routine physicals, for no more cost to you than your usual office visit co-payment. HMOs provide services within a defined geographic area. Generally speaking, you must live or work within the HMO's area. HMOs will pay for limited services outside of their areas under certain circumstances (usually emergency services).

PPOs (Preferred Provider Organizations). These plans are a cross between an indemnity plan and an HMO. They are less restrictive than HMOs, but more restrictive than an indemnity plan in terms of both access and cost. A PPO plan will give you the choice of getting care from either a network or out-of-network provider, but you will pay more if you receive care from a provider outside of the plan's provider network, either through a higher co-payment or a higher percentage of coinsurance.

POS (Point-of-Service) Plans. POS plans are sometimes offered by HMOs to give their members more choice of providers, but at an additional cost. Under a POS plan, members pay only their usual co-payment for covered services obtained from their primary care providers or through referrals to specialists within the plan's network. They are free to use out-of-network providers, too, but will usually pay a higher co-payment or some kind of deductible in addition to the co-payment. Premiums for belonging to a POS plan are usually higher than for belonging to an HMO.

Indemnity coverage. This type of coverage generally allows you to use any doctor you choose. However, in some cases, in order for services to be covered, at all or in full, you must use a "participating provider" who has a payment contract with the insurer. You are also usually required to pay a set amount each year, called a "deductible" before the plan begins to pay its share (percentage) of your medical costs. Most plans also limit the costs you have to pay out-of-pocket each year. It is called an out-of-pocket maximum and it is the most that you will pay for covered medical services in one year.

Example: The plan has a $1,000 annual deductible per person. Generally, once you meet your deductible the insurance will pay 80% and you will be responsible for 20% of the allowed charge. Please note that what an insurer will pay -- and what you may end up paying -- could differ depending on whether a provider "participates" with your insurer for its indemnity plan. A "participating provider" has agreed to accept the insurer's allowed charge amount for each procedure, so you will not be charged anything other than your deductible or coinsurance amount.

If you go to a "non-participating provider", the insurance plan will only pay its portion (80% in the above example) of the allowed charge for the service you receive. You may also have to pay the difference between what was billed by the provider and the amount the insurance company determines is their allowed charge, plus any unpaid deductible that may apply. The allowed charge is determined by the insurer and is the amount that will be paid for each procedure. You should call your insurance company's member services department to find out if your provider is participating with them.