You have choices when you shop for health insurance. If you're buying from your state's Marketplace, the first way you'll see health plans organized is by their level of care: bronze, silver, gold, and platinum. Bronze plans have the least coverage and platinum plans have the most.
Next, you'll see insurance brands associated with the care levels. Some large national brands include Aetna, Blue Cross Blue Shield, Cigna, Humana, Kaiser, and United. If you're buying insurance from your employer, the brand name might be the first category you see.
Each insurance brand may offer one or more of these four common types of plans:
- Health maintenance organizations (HMOs)
- Preferred provider organizations (PPOs)
- Point-of-service (POS) plans
- High-deductible health plans (HDHPs) linked to health savings accounts (HSAs)
Take a minute to learn how these plans differ. Being familiar with the plan types can help you pick one to fit your budget and meet your health care needs. To learn the specifics about a brand's particular health plan, look at its summary of benefits.
Health Maintenance Organization (HMO)
An HMO delivers health services through a network. With an HMO, you may have:
- The least freedom to choose your health care providers
- Predictable out-of-pocket costs
- The least amount of paperwork compared to other plans.
- More preventive care in your benefits package
- A primary care physician to manage your care and refer you to specialists when you need one so the care is covered by the health plan
What doctors you can see. Any in your HMO's network. If you see a doctor who's not in the network, you'll have to pay the bill yourself -- unless it's a true emergency.
What you pay.
- No deductible
- Copays for each type of care
Paperwork involved. No claim forms. You won't get bills for care that is covered.
Preferred Provider Organization (PPO)
With a PPO, you may have:
- A moderate amount of freedom to choose your health care providers -- more than an HMO
- Higher out-of-pocket costs than an HMO
- More paperwork than other plans if you see out-of-network providers
- The ability to manage your own health care
What doctors you can see. Any in the PPO's network. You can see out-of-network doctors, but you'll pay more.
What you pay.
- Premium -- Your monthly payments are based on the negotiated rates PPOs have with their network providers.
- Deductible -- Some PPOs may have a deductible. You may have to pay a higher deductible if you see an out-of-network doctor.
- Copay or coinsurance -- A copay is a flat fee, such as $15, you pay when you get care. Coinsurance is when you pay a percent of the charges for care, such as 30%.
- Other costs -- If your doctor charges more than others in the area do, you may have to pay the balance after your insurance pays its share.
Paperwork involved. There's little to no paperwork with a PPO if you see an in-network doctor. If you use an out-of-network provider, you'll have to pay the provider. Then you have to file a claim to get the PPO plan to pay you back.