Managed Care Plans are the most common form of healthcare coverage in the United States today. Managed Care Plans differ greatly from Indemnity Plans. Indemnity Plans allow policy holders to seek medical care whenever they need it. A Managed Care Plan has many restrictions and limitations.
Most employers now offer managed care plans to their employees. The cost of medical insurance for employees is paid by the employer. Medical benefits for employers are the largest expense. Employers tend to choose the health plan that is most cost-effective for their employees. Employers can save the most money by choosing managed care plans.
Medical expenses can be managed if the access to services and treatments is controlled. This truth is supported by managed care plans, which are beneficial to companies that offer medical benefits for their employees. If viewed from the perspective of a patient, it can be difficult to obtain a treatment beyond basic preventive care if you are in need of one.
The categories of managed care plans are: a Health Maintenance Organization, a Preferred Provider Organization and a Point of Service. The most common are HMOs and POSs. Below is a brief description of the differences between each.
Health Maintenance Organizations (HMO) are more affordable than PPOs and offer coverage for preventive health care. You pay a small co-payment and a monthly fee if you’re an HMO member. HMOs have a wide range of medical providers. These medical care providers are available for you to select from. These medical care providers are bound by an agreement to provide medical services at reduced and already-negotiated rates. Select a Primary Care Physician who will be the first person to examine you when you are ill. If you need to consult a specialist, your PCP can refer you.
You can choose only a PCP on the HMO approved list. Your preferred doctor may not be included on this list. HMOs will not cover the costs associated with medical care providers who aren’t in their network. In most cases, the HMO’s network is not large, making it difficult to get an appointment with a PCP.
Preferred Provider Organizations or PPO are very similar to HMOs. With a PPO, you do not need to see a PCP before enrolling. It is recommended that you choose a provider of medical care from the PPO approved list, even though it’s not mandatory. You don’t require a referral if you need to see a specialist. You will pay a higher co-payment if you go to a provider that is not in your PPO network. The PPO portion of the medical care costs less.
PPOs offer more freedom, but they also come with higher costs. The costs are high if you choose to seek medical services outside of the PPO network.
A POS managed plan is a mix of HMOs and PPOs. The plan offers greater freedom in choosing a provider of medical care and lower costs. It is possible to choose a PCP but difficult to obtain a referral for a specialist. The paperwork will be minimal and the co-payments will also be minimum if you stay within the network. A POS plan has no deductibles. This may make a POS Plan appear lucrative, but POS Plans are not very common.
It is important to do thorough research on the managed care plans available. Plan should meet your needs. Plan coverage and costs vary significantly, so it is important to do your research and ask questions as soon as you can.