Chances are that when your employer offers a health plan, you don’t really know which one to choose. For many consumers, the alphabet soup of managed healthcare plans makes little sense.
Managed healthcare plans offer discounted health benefits to employers who have their employees join the plan. The organization negotiates discounts with a pre-selected group of hospitals and doctors. The two most popular types of managed healthcare plans are the Health Maintenance Organization (HMO) and the Preferred Provider Organization (PPO). An HMO negotiates with pre-selected doctors, hospitals and clinics to provide services to all employees within the plan. The employee must select a service provider within the group. A PPO allows employees to choose their own health service provider, but usually at a higher rate than the providers within the plan. Each plan will vary in cost and benefits based on the company offering the plans. You should choose carefully, because it can be difficult to switch plans after making a selection. Some things to take into consideration when choosing between an HMO and a PPO include:- Whether or not you already have a family doctor. If your doctor is not within the HMO system, you may want to choose the PPO.
- Whether your family has pre-existing health conditions. If you are securing insurance for the first time, you should make certain that those conditions are covered by the plan you choose.
- How emergencies are handled. Determine what emergency rooms are covered and how the plan defines emergencies.
- How physicals are handled. Determine how often your plan will cover physical checkups, if at all. You may also want to look into what the plan offers for pregnancies or your existing children.
- How Prescriptions are processed. Depending on how often you use prescription drugs, you will want to pay attention to any co-pay or level of coverage in a plan.
- How miscellaneous services are handled. Those services include substance abuse rehabilitation, mental health, chiropractic care and experimental/alternative treatment.
Finally, check with each plan to determine what your actual out of pocket costs are. Find out what your monthly payment will be and balance it against the co-payments, if any, as well as the benefit limits and fees associated with specific services.
By Darryl James