You may be aware that health insurance comes in two types: indemnity health insurance plans and managed care plans. Indemnity plans, also commonly known as reimbursement plans, will reimburse your medical expenses up to a certain limit. With the Reimbursement plan, the insurer pays a percentage of the total charges, regardless of how much the charges are. With the indemnity plan, the insurer will pay a specified amount every day for a specified number of days. The amount financed does not depend on the cost of care, but what is financed will never exceed your expenses.
Another popular type of health insurance plans are managed care plans. There are three types of policies classified as managed care plans: HMO, POS, and PPO. The managed care plan is more popular than the indemnity plan because it offers more flexibility and benefits to its clients. With these types of options, you pay a monthly fee no matter how many times you see a doctor, or you pay a copay but no monthly fee. With managed care plans, you are given care options. The plan you choose and the amount of money you want to pay determines how large a network of doctors and specialists you can see and still be covered by the plan. Some managed care plans offer sponsorship programs for a network of hospitals and medical services. You can often get this type of plan through your employers.
On that point, you might think that managed care plans are better for the average person due to the fact that they are more cost effective. So you are absolutely right. While indemnity plans, on the other hand, can give you much more freedom on cost, you’ll need to use the health care provider the insurer chooses. If you have a specific disability, this may present itself as a problem. In the long run, a managed care plan will definitely save you money, especially when emergencies arise when you’re out of town. These types of plans are also more flexible in policy. One thing you should do is before you buy any type of health insurance, be sure to research all the options available to you and your family and make the final decision that insures your life more than anything else.