Health insurance is a type of insurance coverage that covers the cost of an insured individual's medical and surgical expenses. Depending on the type of health insurance coverage, either the insured pays costs out-of-pocket and is then reimbursed, or the insurer makes payments directly to the healthcare provider.
Health Maintenance Organization
HMO plans offer a wide range of health care services through a network of providers that contract exclusively with the HMO, or who agree to provide services to members at a pre-negotiated rate. As a member of an HMO, you will need to choose a primary care physician ("PCP") who will provide most of your health care and refer you to HMO specialists as needed. Some HMO plans require that you fulfill a deductible before services are covered. There is only a required co-payment to make when services are rendered. Health care services obtained outside of the HMO are typically not covered, though there may be exceptions in the case of an emergency.
A HMO may be right for you if:
* You're willing to play by the rules and coordinate your care through a primary care physician
* You're looking for comprehensive benefits at a reasonable monthly premium
* You value preventive care services such as: coverage for checkups, immunizations and similar services are often emphasized by HMOs
Preferred Provider Organization
Like the name implies, with a PPO plan you'll need to get your medical care from doctors or hospitals on the insurance company's list of preferred providers if you want your claims paid at the highest level.
A PPO may be right for you if:
* You want the freedom to choose almost any medical facility or provider for your health care needs
* You want a portion of out-of-network claims to be covered by your insurance company
* You don't want to get referrals before visiting a specialist