Understanding Insurance

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When a serious illness strikes, the knowledge that a comprehensive health insurance plan is in place is reassuring and comforting. But very often, the intricate details of coverage only begin to be understood when critical care is needed.

Between eighty and eighty-five percent of Americans are covered by some kind of insurance, most often provided by an employer. While many employers choose only one insurance plan for their workers, others contract with a number of providers so that their employees are able to choose from several. Those plans which offer more choices to their members are usually more expensive and the employee is expected to pay the extra cost. People who are not covered through an employer will also find that the cost of thier individual policies will vary depending on the extent of coverage, its flexibility, and the amount of money that they are expected to put forward as co-payments at the time of service.

Those who have some choice in the type of coverage they will have should review their options carefully to be sure that they choose the insurance that fits best with the way they want to deal with their medical doctors, hospitals, and other health care services. It may be nearly impossible to change the type of coverage once treatment for a serious illness has begun, and depending upon the plan in place, there may be few treatment options.

These are the types of insurance plans which cover most Americans:

Fee-for-Service or Indemnity plans are plans in which the patient chooses his doctors, including specialists, without restrictions. Although very desirable because of the flexibility they offer, they are no longer easy to find, and may be very expensive. Some plans require the patient to pay up-front for the services they receive and to submit claims for reimbursement.

A Health Maintenance Organization (HMO) provides all health care through it's own medical providers, in exchange for one premium. There may be nominal co-payments for medicines or services, but the major limit is to a patient's choice of doctor and hospital. A primary care physician within the system coordinates all care, and in most cases must make any referral to a specialist, who is also affiliated with the organization. Any treatment received outside the HMO is not covered and must be paid for by the patient.

The Preferred Provider Organization (PPO) contracts with providers to provide health services at discount prices. As in an HMO, the patient chooses a primary care physician who is responsible for providing all of the usual preventative and curative services, and who also refers to specialists within the network when necessary. An additional element of flexibility allows the patient to seek consultation or treatment outside the system if he prefers, but at a higher cost.

A Point-of-Service HMO is an HMO which offers the usual HMO benefits using its own medical organization doctors and services, but also allows its members to see outside providers at an additional cost.

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Related Links on the Internet

10 Commandments for HMOs

Elizabeth Charleton Moore, a senior searching for healthcare, wrote the Ten Commandments for HMO's and Questions to Ask Your HMO, to help people looking for a good plan to get the answers they need.

Alliance of Community Health Plans

ACHP is an alliance of not for profit health plans. If you live in their coverage area, you may find your health plan listed. There are a number of interesting links to news sources and to other health care related sites.

HMO's The Health Maintenance Book Page

If you'd rather read off-line about HMO's, here is a list of books and publications on the subject.

Insure.com's Health Insurance Page

Comprehensive, understandable insurance information.

NCQA's Health Plan Report Card

National Committee for Quality Assurance is a private, not for profit organization which sets standards for health care and assesses various providers. You can see how your own health plan measures up.

Questions to Ask Your HMO

Reviewing your options? This is the complimentary piece to the Ten Commandments for HMOs

The HMO page

This page is produced by a group called Physicians Who Care, and promotes Medical Savings health plans. Its bias is very clear, it doesn't like HMO's. But it is another side of the story and has some useful links to related sites, including current legislation and news about health care.

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