Choosing a Health Insurance Plan is important, and making sure you choose the right one for you, your family, and your budget is a priority. Now, through August 15th, 2021 is an active Special Enrollment Period, signed into action by the current Presidential Administration, which allows anyone who is eligible to sign up for Health Insurance without waiting for the Annual Enrollment Period in November.
Many times, if you have Health Insurance, it’s through a Group Plan offered by your employer or your spouse’s employer. Others purchase individual policies directly from an Insurance Company or Brokerage, and others have COBRA coverage. Some people have no coverage at all, which can potentially be problematic for your finances.
If you are married, single, have children, are young or old, you need some level of Health Insurance to protect yourself against financial disaster in the event of an accident or illness. Whether you choose a group plan or an individual plan, there are important choices to be made that will affect not only the quality of your medical care coverage but also will affect your wallet. Reviewing some of these choices can help you make an informed decision that will suit your specific needs.
Types of Health Insurance Plans
There are quite a few confusing terms to weed through when considering Health Insurance plans, and they all come with their implications to consider. While it is important to know the difference between HMOs, PPOs, POS Plans, and Indemnity Plans, for instance, it is helpful to start with the most common Health Insurance plan types. The three most common are:
- An Indemnity or Fee-for-Service Plans
- Health Maintenance Organizations (HMOs)
- Preferred Provider Organizations (PPOs)
An Indemnity or Fee-for-Service Plans
Traditional plans that allow you to go to any doctor or specialist you choose without the need for a referral are called indemnity, fee-for-service, or point of service (POS) plans. With these plans, the insurance company will pay for a set portion of your charges, and you pay the rest. These plans provide the most flexibility as they do not set restrictions on the providers you can use, and generally do not require that you select a primary care physician (PCP).
Advantages of Indemnity Plans
The primary advantage of an Indemnity Plan is that you can choose to get your medical care anywhere you want and from whoever you want, without getting referrals or prior approvals.
Disadvantages of Indemnity Plans
To control costs, insurance companies shift more costs to you through higher premiums and deductibles, making indemnity plans more costly to you than HMOs and PPOs. Additionally, you may be expected to pay for your medical services upfront and then submit a claim to your insurance company for reimbursement, which ties up your money and puts you at risk of not getting it back.
Health Maintenance Organizations (HMOs)
An HMO or Health Maintenance Organization is an association of healthcare professionals and medical facilities that sell a fixed package of health care services for a fixed price. Within an HMO insurance plan, each patient has a primary care physician, who is often referred to as a gatekeeper. The plan does not cover services provided by a specialist unless the gatekeeper (PCP) determines that the specialist is necessary and issues an in-network referral. As such, all of your care is coordinated through your PCP.
Advantages of HMOs
The primary advantage of an HMO plan is that your out-of-pocket costs are often lower and more predictable. Another advantage is that claim forms are not usually necessary.
Disadvantages of HMOs
Services provided by healthcare professionals outside the network generally aren’t covered except in the case of a true emergency. Another disadvantage for some is that services provided by specialists require a referral from your primary physician, which may require an additional doctor’s appointment. Under an HMO plan, some services may be limited to outpatient
Preferred Provider Organizations (PPOs)
A PPO or Preferred Provider Organization contains the managed care aspect of an HMO but with the added flexibility of being able to go outside of the network of healthcare professionals and facilities to any health care provider of your choice when you feel it’s necessary. When you go outside of the network, your benefits are less and you pay more out of your pocket than you would if you had stayed within the network, but you do still have some coverage (unlike an HMO). If flexibility and choice are important to you, a PPO may be a good choice if it’s available to you. They are not available in all states or locations.
Advantages of PPOs
The primary advantage of a PPO is that you have more flexibility than you would in an HMO, but not as high costs associated with an indemnity plan.
Disadvantages of PPOs
The primary disadvantage of a PPO is that it can be more difficult to predict your out-of-pocket costs.
Where can I get Health Insurance?
Most people here in Arizona get their Health Insurance through employer-sponsored Group Health plans (often this coverage is paid for at least partially, by the employer). However, many small employers don’t offer health insurance or coverage is too expensive even if they pay a portion.
You can luckily, buy an individual policy. In the past, these policies were looked at as cost-prohibitive, but one of the many objectives of the Affordable Care Act (ACA), was to overhaul the individual health insurance market and make individual plans more affordable.
You can now search through the ACA Health Insurance Marketplace either through HealthCare.Gov or by calling a local brokerage service. Brokers are recommended as they can answer any questions you have, help you compare and narrow down plan options, walk you through the entire enrollment process, help with any issues or claims that arise, offering support throughout the year, not just when you enroll. Brokers are free to work with, as they are paid directly from the insurance carriers, so as such, there is everything to gain by working with a direct broker. A broker can be contracted with all of or most of the major carriers, offering you the most plans available, as opposed to a captive agent, who can only present you with one carrier’s plan options.
To schedule a time to speak with one of our brokers, or for more information or support regarding Group Health Plans or Individual Health Insurance, including Medicare, please contact one of our licensed and trusted advisors at Group Plans Inc (623) 889-7600