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 Advantages to Managed Care Plans

There are many types of health insurance plans. Picking the right one for yourself can be confusing at first, especially if you don't know what you're looking for. You might have a hard time deciding which one would be right for you.

Health insurance is divided into two broad categories: indemnity plans and managed care plans. Indemnity plans, also commonly known as reimbursement plans, reimburse your medical expenses up to a certain limit. Under the reimbursement plan, the insurer pays a percentage of the total costs, regardless of the amount of the costs. With the indemnity plan, the insurer will pay a specified amount each day for a specified number of days. The amount reimbursed does not depend on the cost of medical care, but what is reimbursed to you will never exceed your expenses.

The other popular type of health insurance plans is managed care plans. The three types of policies classified as managed care plans are HMOs, POSs, and PPOs. This type of insurance is more popular than the indemnity plan because it offers more flexibility. With these types of options, you either pay a monthly fee, regardless of how many times you see a doctor, or you pay a copayment, but no monthly fee. With managed care plans, you have care options. The plan you choose and the amount of money you want to pay determines the size of the network of doctors and specialists you can see and still be covered by the plan. Some managed care plans (most commonly PPOs) offer referral programs from a network of hospitals and medical services. You can often get this type of plan through your employer.

Managed healthcare plans are better for the average person due to the fact that they are more cost-effective. Although indemnity plans can give you much more freedom over costs, you will need to use the health care provider chosen by the insurer. If you have a specific disability, this may present itself as a problem. In the long run, a managed care plan will save you money, especially if emergencies arise while you're out of town. These types of plans are also more flexible in the policy. Before purchasing health insurance, be sure to research the many options available to you and your family to ensure you receive the best possible coverage for the lowest monthly premium or deductible.