Types of Health Plans
There are many different types of health insurance plans available to consumers. Once you figure out the kind of policy or plan you want/need, you should select the company that offers your product(s) and service(s) at the quality you desire for the lowest cost. However, it is also import to take into consideration the financial quality of a firm. Do your research, you will want to ensure that the company will be able to pay, should you need it.
- HMO
- PPO
- Point-of-Service
- Managed Care
- Indemnity Health
- Health Savings
- Major Medical
- Catastrophic
- Dental
- Vision
- Prescription Coverage
- Disability
- Health Discount
- Hospitalization Insurance
- Short Term Health Insurance
- Long Term Care Insurance
- Temporary Health Insurance
- Supplemental Plans
- Travel Health Insurance
- Limited Benefits Plans
- Medicare
HMO Health Plans
An HMO, also known as a health maintenance organization, is one of the most widely-used health plan types in the country. This type of plan is based upon a HMO network, which is a group of doctors and other health care providers who contract directly with the HMO company in order to reduce health care costs. HMO plans are most closly related to managed care health insurance plan, in that the HMO is directly involved in the medical treatment of their customers. Which means that the HMO has to approve tests and treatment before they are performed.
Other HMOs are more loosely affiliated models, sometimes called Individual Practice Associations, where the participating health care providers operate from their own offices.
HMO health insurance plans are generally the cheapest kind of coverage available, but they are also the most restrictive.
PPO Health Plans
PPO insurance, also known as preferred provider organizations, are types of managed care health plans that are similar to HMO’s in structure, but offer more flexibility to consumers when it comes to choosing their health care providers. PPO networks tend to be much larger than HMO networks and the majority allow you to see doctors outside of the network. If you do see a doctor out of network, the insurance provider will pay less than they would pay for an in-network provider.
With a PPO you probably will not have to designate a primary care physician or obtain referrals before you can visit a specialist if you are a member of a PPO. However, PPOs often require more paperwork than comparable HMO plans.
Point-of-Service Plans
A point-of-service health insurance plan is a type of policy that combines features of HMO’s and PPO’s. While they are generally more flexible than an HMO, they do have many restrictions that do not apply to PPO coverage.
Managed Care Plans
Currently, almost all health insurance plans are managed care insurance plans. Managed care means that the insurance company actually influences the treatment choices through a specific network of health care providers. HMO’s, PPO’s, and point-of-service plans all fall into the category of managed care.
Indemnity Health Plans
Indemnity health plans, or reimbursement plans, are the most flexible and most expensive type of plan for sale today. Indemnity health plans are an excellent selection for people who are willing to pay the additional price as a trade off for maximum flexibility.
Health Savings Accounts
Health savings accounts are not actually health insurance. However, they are used in conjunction with an individual health plan, like and HMO or PPO, to help cover the costs of health care for consumers. A relatively new product, a health savings account can be a valuable tool in helping you pay for health coverage, and they also have a number of important tax advantages.
Major Medical Insurance
Major medical insurance can be either managed care or indemnity coverage. Regardless of the type of plan, major medical insurance is simply a medical insurance plan that comes with a high deductible and only covers serious injury or illness.
Catastrophic Health Insurance
Catastrophic health insurance is simply another term for major medical insurance. As the name implies, this type of plan offers coverage only in the event of a "catastrophic" occurrence, such as a serious accident or prolonged illness.
Dental Plans
Dental plans are generally offered as a supplemental coverage along with another type of a medical insurance. There are also "dental discount cards" available for purchase without health insurance. This section discusses the different types of dental insurance and dental discount plans that are available to consumers.
Vision Plans
Vision plan coverage, like a dental plan, is often provided as a supplement to regular health insurance. This type of coverage is used to maintain eye health for the insured individuals and generally includes basic exams and eye care. This section describes different options related to vision insurance coverage that you may want to purchase along with your primary medical insurance.
Prescription Coverage
Prescription coverage is normally included at some level in most primary health insurance policies. Aside from this type of supplemental prescription benefit, consumers may purchase standalone drug discount cards for saving on prescription medications. This section discusses all types of prescription coverage available to health insurance consumers.
Disability Insurance
Disability insurance is not really health insurance. However, this type of coverage is often purchased along with traditional health insurance to help pay for bills and lost wages in the event that the recipient becomes ill or injured for a prolonged period of time. Almost no medical insurance policies provide this type of coverage.
Health Discount Plans
Health discount plans are not health insurance. They are plans that allow for discounts on health care and prescriptions at certain health care facilities that have contracted with the discount plan company. These types of plans can be very risky and often do not provide adequate health coverage, so consumers should be very careful when opting to purchase this type of plan. Get more details in our guide to health discount plans.
Hospitalization Insurance
Hospitalization insurance is coverage that pays for specific costs associated with a stay in the hospital. Although some health insurance plans provide a level of hospitalization coverage, others do not. When they do offer this type of coverage, it is often significantly less than what is needed in the event of a major illness or injury. For this reason, it may be a good idea to purchase separate hospitalization insurance or to increase the levels of coverage in your current health insurance policy.
Short Term Health Insurance
Short term health insurance is coverage generally purchased to fill the gap of coverage between jobs. It can be a very valuable tool to protect an individual or family from a serious accident or illness or to ensure continuance of coverage between jobs.
Long Term Care Insurance
Long Term Care refers to help with basic activities of daily living. These include things like bathing, dressing, eating, and using the toilet. This help can be provided in the home, in middle-ground settings such as assisted-living facilities, or in nursing homes. Long Term Care Insurance seeks to provides ongoing income to cover the costs of such assistance.
Temporary Health Insurance
Temporary health insurance is just another term for "short term health insurance." This is coverage usually purchased for less than 12 months, which typically provides catastrophic or "major medical" coverage to the insured, without providing more extensive health care benefits that a primary HMO or PPO plan would.
Supplemental Plans
Supplemental health insurance is a broad topic and includes many of the plan type mentioned above. Common types of supplemental plans are supplemental accident insurance, disability insurance, Medicare supplement insurance (primarily for seniors), insurance for specific diseases like cancer, and supplemental hospital insurance, to name a few. This section provides detail on many types of supplemental coverage.
Travel Health Insurance
Travel health insurance is a type of coverage you can purchase when traveling outside of the United States. Since most health insurance plans do not cover illness or injury that occurs outside the country, this is generally a highly-recommended type of coverage for travelers. It can assist in getting and paying for health care if it’s needed and may even pay to bring you back home if the situation is serious enough.
Limited Benefits Plans
A limited benefit health plan simply covers some specific health care cost, such as a stay in the hospital, surgery, or emergency care. As the name suggests, this type of policy in very "limited" in coverage but it can be a good option for some people.
Medicare
Medicare covers only "medically necessary" care. In some cases it will cover nursing home or home healthcare, but only after a three-day stay in the hospital, and only for services provided by "skilled medical professionals," such as registered nurses and physical therapists.
