Health insurance is a way to limit the risk of medical expenses. Often, no one plans to become sick or hurt, so it is helpful to have a plan in place to help cover the costs of treatment. There are many types of health insurance, including private, public, and self-funded. Understanding the different types of plans is the best way to choose the right insurance for your needs.
HMOs, or Health Maintenance Organizations, are generally the cheapest type of health insurance. These plans are based on a contract with a network of physicians. You may be able to get some care from doctors outside the network, but you will likely have to pay more. These plans also require you to have a primary care physician. They are not the best option if you want to see many doctors or need a doctor who is not in your network.
PPOs, or Preferred Provider Organizations, are a more expensive type of plan. This type of plan lets you visit any physician who is approved by the health insurance company. They are more flexible than HMOs, so you might find more providers to choose from. They are also less likely to have out-of-pocket expenses.
Indemnity plans are similar to HMOs, except the insurer pays 80% of the cost of care. The cost of services is determined by the UCR, or Universal Coverage Ratio. This fee is based on the rate charged by providers in the area.
Some plans also offer free preventive care, such as vaccines. These benefits are part of the Essential Health Benefits required by the Affordable Care Act. Other services covered by health insurance include doctor visits and prescriptions. In addition, most plans include some type of deductible, which is the amount of money you have to spend out of pocket before the plan begins to pay.
Depending on your state, you can apply for coverage through the Marketplace. You can do this by phone, mail, or online. You can also get free or low-cost coverage through Medicaid or CHIP. If you do not have insurance, you will be assessed a penalty at tax time. However, this penalty is usually smaller than the cost of the coverage you could have bought.
Another type of plan is an EPO, or Exclusive Provider Organization, which requires you to use an exclusive group of providers for covered services. These plans are regulated by the Department of Labor and the Office of Personnel Management.
If you are looking for health insurance, you can learn more about the different plans by reviewing the insurance documents provided by the plan’s provider. These documents will give you a basic overview of the plan’s network and out-of-pocket costs. It is important to know your options so you can make the right choice for your family.
In most states, you can apply for coverage on the Marketplace. You can also apply through your employer. Typically, people who work for a large business with more than 50 employees are offered a large-employer health plan. If you have a small business or are self-employed, you can look into a self-funded plan, which is regulated by the U.S. Department of Labor and the Department of Treasury.