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Health Insurance Guide
An Alternative To Indemnity Health Insurance And Managed Care
For a long time now people have felt trapped between choosing a traditional indemnity health insurance plan (offering a wide range of choice and high degree of security in the event of an accident or serious illness at a relatively high cost) and a managed care plan (focusing on preventative medicine with severely limited choice but at relatively low cost).
It is however now possible to some extent to enjoy the benefits of both indemnity health insurance and managed health care through a variation on the original managed healthcare model provided by the Health Maintenance Organization (HMO) in a plan known as a Preferred Provider Organization (PPO) plan.
In essence a health insurance PPO HMO plan is an HMO which means that the insurance company establishes a network of healthcare providers and, in exchange for a reasonably low cost, will encourage, or in some instances require, plan holders to seek treatment within the HMO’s network. Normally, where treatment is sought outside of the HMO’s network much, if not all, of the cost is borne by the plan holder however, in the case of a PPO, the rules for plan holders who want to seek care outside of the HMO’s network have been relaxed.
An HMO assigns a plan holder to a particular doctor or primary care physician (often known as a "gatekeeper") and the plan holder must go through the primary care physician in order to receive treatment. For example, if the plan holder wants to see a specialist then he or she must be referred by the primary care physician and may or may not have a say in which specialist they are referred to.
However, in a health insurance PPO HMO plan no primary care physician is assigned and so no referral is necessary. Plan holders are free therefore to seek treatment through a specialist who is not a member of the HMO’s network if they wish to do so.
Naturally there are cost implications to this choice and plan holders will normally have to pay more for treatment with a doctor or in a facility outside the HMO’s network. Unlike the HMO model however the PPO now gives plan holders the choice.
In essence, PPO individual health insurance coverage provides plan holders with the low cost benefits of the HMO but also provides the option to elect for the greater choice, albeit at a higher cost, of indemnity health insurance when it suits the plan holder.
It is no surprise that today traditional indemnity health policies are rapidly disappearing and that there are now twice as many people enrolled in PPOs as there are in HMOs.
Individual health medical insurance quotes - PPO coverage
Carve-out companies: Organizations that have specialized provider networks and are paid on a capitation or other basis for a specific service, such as mental health, chiropractic, and dental.
Ethics in Patient Referrals Act: A federal act and its amendments, commonly called the Stark laws, which prohibit a physician from referring patients to laboratories, radiology services, diagnostic services, physical therapy services, home health services, pharmacies, occupational therapy services, and suppliers of durable medical equipment in which the physician has a financial interest.
Medicaid: A jointly funded federal and state program that provides hospital expense and medical expense coverage to the low-income population and certain aged and disabled individuals.
Quality program: An organization-wide initiative to measure and improve the service and care provided by an MCO.
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