The idea behind health insurance came into being back in the 1930s when Blue Cross introduced something that was then known as pre-paid hospitalization. After that, Blue Shield came into being after its success with the proposal. The rising cost of treatment and medication, and advancement of the health care sector also saw a need for health insurance. The following are the general health insurance plans available today.
1. Fee-for-service health insurance plans
Otherwise referred to as traditional or indemnity health plan, in this type of health insurance, you are at liberty to visit any hospital in the United States of America, or even change your doctor any time. You will then be expected to be paying a fixed monthly premium charge and each year you should be able to pay a fixed amount payable as your medical cost; this is known as a deductible. In this case, you are committing to pay with the deductible an agreed upon amount of cash and the remainder of your medical cost will be paid by your insurer. Once you meet your deductible, your health insurance service provider will start to send a customary bill percentage.
2. Managed care plans
This is the second type of health insurance plans available today, which is further categorized into 3. Most of the plans under this group have low premiums; they accept co-payments, the total amount of money allocated during the health insurance service period. You need not file up any claim forms with this plans as they cover both preventive and serious health care cases and illnesses. Types of managed care plans include:-
a. Preferred Provider Organization (PPO)
If you go with this type of managed health care insurance plan, you agree to use the doctors and hospitals listed within the service provider network that is if you want to get yourself insured. By visiting the listed hospitals and using the services of the listed medical practitioners, you will make it easier for your medical bills to be paid in full and on time. If on the other hand you opt to use your service providers, you shouldn’t blame yourself if your medical bill comes knocking on your door by the end of the month. You will be expected to offset your medical bills out of pocket.
b. Health Maintenance Organizations (HMO)
Just like in PPO, your service providers are only limited to those listed on the provider network. However, HMO is very flexible as it will cover a wide gamut of medical expenses immediately you pay a negligible co-payment.
c. Point-Of-Service Plans
Under this managed health care plan, you can seek the services of a doctor not listed in the provider network, but only if you are referred by a doctor who is already listed there. In case you use the services of a doctor who isn’t listed there, while the medical expenses will be paid in full, you will be expected to pay a co-insurance i.e. a guaranteed percentage of your total medical expenses.