Basis of health insurance

Each person should have a health insurance policy. Mostly it is provided by employer to employee, so that it can cover your medical costs when you are ill. Most of the plans involve monthly payments which also involves deductibles and co-payments. Basically there are four types of California health insurance. They are health maintenance organizations (HMO), Point-of-service (POS), Preferred Provider organization (PPO) and indemnity plans. HMO, POS and PPO are managed care plans. Indemnity plan is much different from managed care plan.

In a Health maintenance organization plan members have to pay monthly fee and co-payments. Co-payment is an amount paid at the time of treatment to offset a portion of the medical costs. In this type of plan, members can choose a physician from the network. Members have to contact the physician if they face any medical problems. If members have to consult a specialist they have to take the permission of their physicians. HMOs only cover members if they visit doctors within the HMO insurer network. If a member wants to meet a specialist out of the network he has to bear all the expenses from his own pocket.

Preferred provider organizations encourage members to visit physicians and hospitals within the network but they also allow members to visit out-of-network doctors and hospitals. PPOs cover most of your medical costs if you visit an in-network provider. However, if a member visits a doctor out of the network, he/she will be covered to a certain degree. In an HMO Plan members generally pay monthly fee but in the case of PPO members pay for their medical coverage based on the individual medical services used. Like in HMO plan, even in PPO plan you have to pay co-payment. Unlike in HMO plan, in PPO members have to pay deductible.

Point of service combines attributes of both HMOs and PPOs. In this plan you don’t have to pay deductibles and very less co-payments. If a member visits a doctor out-of-network his medical expenses will be covered to a certain degree. POS plans have no deductible and limited co-payments for in network coverage.

Indemnity plans give more freedom than managed care plans. In this plan, they can see any doctor they wish. This type of medical plan is more expensive than managed care plans and involve more out of pocket expenses.

You only can identify which plan suits your health needs. If you want to visit specialist’s out-of-network then managed care plan is not the best choice.

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