Hassle-Free Health Coverage: Old Fashioned vs. New
Is access to preventive care and routine check-ups an important factor in your choice of a health plan? If you answered "yes," you might want to go with a traditional indemnity-type plan. But, if you'd rather save money on premiums, an HMO might be a smart choice.
A traditional indemnity plan or fee-for-service coverage gives you freedom of choice. You choose the doctor you want to see and then pay a fee for each service rendered. If the services are covered under your policy, your insurance company will reimburse you for some -- but not all -- of the cost. Many policies pay 80 percent of the costs. Fee-forservice plans cost considerably more than managed care plans.
However, if you want lower premiums, you will have to give up some of this freedom of choice (unless of course, your doctor is part of the HMO network and listed as your primary physician). Rather than being penalized by getting less of a reimbursement, as in a PPO plan -- which gives you some choice, with an HMO you'd have to pay the whole bill yourself. (Clearly, this is a strong incentive to see only providers within the HMO.)
Today, many HMOs have added options to their plans which allow you to see a doctor of your choice who is out of network -- of course, this, too, will cost considerably more than a co-payment.
A PPO or POS combines the features of fee-forservice plans and HMOs. These types of managed care plans provide choice regarding doctors, hospital, etc. Whereas an HMO, restricts choice to a network provider. Under these plans you will also get some reimbursement for covered services from a provider. The only major difference between a PPO and a POS plan is that under a POS plan, a primary care physician coordinates your care; and in most cases, PPOs do not.
If your doctor is already a contracting provider with a PPO or HMO, you may be able to save some money by going with one of the more restrictive plans -- and you'd still get to see the doctor of your choice. In other words, read the preferred provider list, or the HMO's provider list, before you decide.
HMOs can be quite restrictive; and many people don't learn the details of their plans until they have a medical problem -- or a problem with coverage. Critics question whether managed care has been stretching its method of cost containment too far. Among other things, managed care is criticized for depleting funds for scientists and medical schools, proposing gag rules to restrict treatment discussions between doctors and patients, and offering financial incentives to its staff for curtailing medical costs.
It's worth looking into how much the service fee is for monthly payments -- and inquiring about a discount for prepayment.
Even if you already have health insurance, you'll want to review your policy once a year to be sure it still matches your needs.
As the health care system continues to change, your health insurance should change with it.
