4 common types of health insurance plans you might want to know about

0
Reading time: 3 minutes

Whether you are looking for health insurance for yourself or for a group of people like your family or employees, there is a wide range of types of health insurance you can opt for in these situations. That said, researching your health insurance options is helpful once you’re ready to sign up for a new plan.

This is because the more familiar you are with the different types of health insurance, the better your insurance coverage will be, which means you will choose the best deal possible based on your specific parameters. Luckily for you, in today’s article, we’ll briefly go over the plans you might come across in your research on types of health insurance. Let’s start.

Preferred Supplier Organization Plan

Preferred Provider Organization or PPO is perhaps one of the most common types of insurance in the market. However, this one is for employees, so if you’re an employer looking for health insurance for your workers, a PPO is right for you. Plus, with a PPO plan, your employees will be encouraged to use a network of hospitals and doctors to negotiate a lower rate.

Your employees can choose the doctor or hospital they want with their plan. Additionally, they may choose to meet with a specialist without a handy referral. Perhaps the only downside to this plan is that it charges more than the usual premium cost compared to the other plans on this list.

Health maintenance organization plan

The Health Maintenance Organization Plan, or HMO, is a plan that provides a wide range of health services from a network of providers who have a contract with the HMO. Unlike PPOs, HMOs generally require you to select a primary care physician as part of the plans, and they would also be required to refer you if they wish to see a specialist.

However, HMOs have a wider range of preventative care than other plans. Also, employees aren’t required to pay a deductible before their coverage begins, but they can choose to do so, and generally they can get a co-payment for medical expenses and drugs. On the other hand, a downside of this plan is that it does not cover employees outside of the preferred network unless referred by their attending physician or in an emergency.

Compensation scheme

If you are in search of health Insurance, this one might interest you. With an indemnity plan, the insurance company will pay a predetermined percentage in a specific geographic area for a given service, and the insured will pay the rest. There is no preferred network in this plan, so you can choose which doctor or hospital you want to go to as long as it is within the given geographical area.

However, the fees are determined by the provider and vary from doctor to doctor, which means that the insured has the potential to be responsible for huge and unforeseen medical bills, which of course depends on the service. .

Also, they can be quite expensive than the regular monthly premium for a standard health policy, but that depends on the benefits you want to include and the area you live in. But that said, if you want to choose your doctor and hospital and not have to have a referral to see a specialist, then an indemnity plan might be right for you.

Health savings account

A Health Savings Account or HSA is an account used with another HSA- or HDHP-compatible high-deductible health plan to pay eligible medical expenses. Although HSAs may be offered group health insurance coverage, employers can still contribute to the policy, even if the policy is not offered as a group policy. However, an employer can only contribute if they have an HDHP for their employers, meaning low deductible insurance plans like short-term insurance for a limited period are not applicable.

HSA contributions can be made pre-tax, with specific limits set each year by the IRS. Any unused funds in the HSA will carry over each year to the next, earn interest, and be tax-free. Probably the best thing about this plan is that your employees can withdraw funds from the account, although they will have to pay fees and interest if they are not over 65.

To conclude, if you have an HDHP and want to contribute, an HSA would be perfect for you. However, there are of course setbacks, such as paying deductibles, and the money should only be spent on medical expenses. Removing it for another reason will result in another penalty.

Last words

If you are looking health insurance for your employees or yourself, these plans discussed above are great options. But of course they have pros and cons, so choose carefully. That said, on the whole, they have very beneficial assets depending on the situation.

Share.

About Author

Comments are closed.