Understanding HMO, PPO and FFS Health Insurance Plans

Health insurance is offered in various forms today. Traditionally, health insurance plans were indemnity plans; the insured has paid a premium, health care services provided doctors, the health insurance plan has been charged and the health insurance plan paid for covered services. As the cost of health care has become astronomical, health insurance companies developed various plans that were designed to provide quality health care at affordable prices. Health care has become the buzzword Managed to industry of health insurance, and health insurance plans has become more complicated.

Health maintenance organizations, or HMOs, and preferred provider networks, or PPOs, have largely replaced the health plan of the traditional compensation. HMOs and PPOs use strategies to contain the costs of health care. These health plans are similar in some respects. Both HMO and PPO contract plans with health care providers to deliver health care services at reduced rates for members of the health plan. Typically the two planes require the member have a primary care provider, or PCP, which serves as a "gateway" to coordinate care for the member, and all specialized services are accessed by referral of the CFP. Both HMOs and PPOs require certain services and products, usually more expensive, to be examined by health insurance reviewers for prior approval or prior authorization before the service is rendered. The health care provider must submit justification for these "medically necessary" and the examiner determines whether the service is a covered service. The plans make provision for emergencies that can not wait for approval / prior authorization, but still require an approval process.

HMOs and PPOs differ significantly, however. A PPO plan often covers services rendered by providers who are not in the plan's network, but usually at a lower rate than that given for the network providers. HMOs usually offer no coverage for health care providers off-grid.

Plans HMO benefits / PPO generally include health insurance premiums lower than traditional health insurance plans. HMOs and PPOs often provide coverage for preventive care and health maintenance are not covered by compensation schemes. The member of the health plan is generally not necessary to file claims for health care services; contract providers directly bill health insurance plan.

Disadvantages of managed health care plans include limiting coverage to providers in the health care plan. plan members must change their primary care provider if the provider is not in the health plan's network. Many members do not want to change health care providers. Another disadvantage is that the approval process before / authorization may take a long time and slow down the delivery of needed health care services. specialty health care can only be accessed by reference of the CFP.

In summary, HMOs and PPOs offer lower premiums and increased coverage, but the limit of members to their network of suppliers. Compensation Schemes allow the member to see the health care provider of their choice, and access to specialized care when they want, but usually pay higher premiums for health insurance coverage. Finally, the member of the health plan must decide whether choice of doctor and access to specialist care are worth the higher premiums. Whatever the plan chosen, it is vital for members to know their health insurance plan, including the services are covered and that suppliers are networked.