In today’s world, health insurance isn’t a luxury, it’s a necessity. The wonders of modern medicine are a result of centuries of medical research; that research has a price tag. The cost of medical research is high and has been passed along to the consumer through soaring healthcare costs. Without health insurance, one wrong step could lead a family into financial ruin. The information provided below should help you choose the right health insurance plan for you and your family. WHAT TYPES OF HEALTH INSURANCE PLANS ARE AVAILABLE?
Tennessee health insurance plans generally fall into one of two categories: indemnity plans (reimbursement plans) and managed care plans (PPO, HMO, and POS plans).
WHAT IS AN INDEMNITY PLAN?
A health insurance plan that reimburses the member or healthcare provider at a set rate or a certain percentage of charges for services rendered. Indemnity plans place no restrictions on which providers a member may visit for healthcare services, but involve much more paperwork and leave the member with much higher out-of-pocket expenses.
WHAT IS A MANAGED CARE PLAN?
A managed care plan is a health insurance plan that provides much broader coverage than an indemnity plan. This type of plan involves an arrangement between the insurer and a selected network of health-care providers. These types of plans require the member to stay within a select network of doctors or have claims paid at a reduced level.
WHAT IS A PPO PLAN?
A Preferred Provider Organization plan is by far the most popular plan available to consumers today. A PPO is a healthcare system organized by an insurance company. Physicians, healthcare providers of all types, hospitals, and clinics sign contracts with the PPO system to provide care to its insured members. These medical providers accept the PPO’s payment schedule and medical care guidelines. The PPO system is the most popular choice because it gives the member the freedom to choose any physician without the need for referrals and offers the largest network of physicians and providers. One of the more popular PPOs in Tennessee is the Tennessee Healthcare PPO (THC).
WHAT IS A HMO PLAN?
A Health Maintenance Organization plan consists of a group of doctors and healthcare facilities that work directly for the HMO. The member is required to choose a Primary Care Physician who will then manage the member’s healthcare. Should healthcare be required, the member would consult with the primary care physician who would then refer the member to another physician if necessary.
WHAT IS A POS PLAN?
A Point of Service plan is another type of managed care health insurance with characteristics of both an HMO and a PPO. A POS plan offers more flexibility than a HMO, but less that a PPO. With this plan the member will need to select a primary care physician just like an HMO, but can self refer to specialists if desired. However, this will reduce the benefits paid by the insurance company, which will leave higher out-of-pocket expenses for the member. Also, many POS plans require the member to file their own claims if using an out-of-network provider. Finally, the POS pays at a much lower rate if you find yourself using an out-of-network provider.
WHAT SHOULD A GOOD PLAN COVER?
An ideal health insurance plan would cover all of the following:
- Hospital expenses to include room, board, and miscellaneous costs while hospitalized.
- Surgical expenses to include surgeon fees, anesthesia, and related surgical costs.
- Physician expenses to include office visits and physician fees if hospitalized.
- Major medical expenses, which would protect the member against losses from catastrophic illness or injury.
- Prescription drugs to include generic as well as brand name drugs.
- Preventive care to include wellness exams, pap smears, immunizations, etc.
- Mental health benefits to include inpatient or outpatient costs for depression, chemical dependency, and drugs to treat these conditions.
HOW DO I DECIDE WHICH PLAN IS BEST?
Unfortunately, there’s no such thing as a standard health insurance plan since all plans vary according to the company and the area in which the member resides. Simply put, the best health insurance plan is the one that offers the greatest flexibility and benefits for the lowest cost. Before requesting your health insurance quote, make a list of key benefits that would are most important to you and compare your needs to what the different plans have to offer.