|  | Healthcare Industry | Health Insurance

Individual Health Coverage Options

Consumers have many options for individual health coverage, depending upon the type of plan chosen, personal needs and cost considerations. They broadly fall within four primary types of coverage, and are widely available through a number of A-rated insurance companies. Each should be carefully researched to account for plan limitations, restrictions and deductibles.

  1. Major Medical Insurance

    • The insured individual must pay a deductible before any benefits are paid. Under this type of coverage, the insurance company typically pays 80% of hospital and/or medical bills, with the consumer responsible for the balance. While in some cases the consumer must pay the entire bill directly and then get reimbursed by the insurance company, that option is becoming much less prevalent in favor of individuals paying their 20% share, and signing a release for the insurance company to pay the balance directly to the medical provider.

    Preferred Provider Organization

    • While a PPO involves a network of physicians, insured individuals can seek the services of any doctor, whether in or out of the network. In the latter instance, however, consumers are responsible for higher deductibles and co-pays. This is because doctors within the network typically determine reasonable fees for specific services, negotiated in advance with the insurance companies. Out-of-network doctors are free to charge higher fees, leaving consumers responsible for the additional costs.

    Health Maintenance Organization

    • An HMO is a popular option because of its lower cost relative to Major Medical insurance, and given its emphasis on longer-term options. The insured chooses a primary-care doctor who offers preventive counseling and care and is the central point of contact, referring the patient to specialists and hospitals as appropriate. Insurance companies require the doctors to be within a network, and do not cover procedures and services they consider unnecessary. These factors contribute to this option's lower cost.

    Point of Service

    • A POS contract represents a hybrid of the PPO and HMO options. Consumers choose a primary-care doctor who remains the focal point for all medical care. The difference with this plan is that doctors can authorize referrals to any specialist whether in or out of network. With HMO plans, by contrast, specialists must be part of the network. As a result, POS plans offer greater flexibility both for doctors and patients whenever additional services are required.

Health Insurance - Related Articles