Different Types of Health Plans: How They Compare

Diffrent types of health care.

Health care planes,

Health care plans come in many shapes and sizes, each offering unique benefits and coverage. A variety of factors must be weighed when determining the best plan for your family, including out of pocket costs, covered services, copayments and coinsurance amounts, and more. In order to help you make an informed decision, it is important to understand the different types of health plans and how they compare.

Fee-for-Service plans are the most traditional type of health insurance and involve the patient directly paying their provider for services. In this model, the patient is free to choose any doctor or hospital with no restrictions. Although this plan gives the patient the greatest amount of freedom, it can be costly since the patient must pay up front for the services received.

Managed care plane,

Managed Care plans, on the other hand, involve the patient paying an organiyation to receive their care. These plans typically involve signing a contract connecting them to a network of healthcare professionals that have negotiated discounted rates with the Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO). By joining an HMO, a patient can access discounted rates for services rendered by members in the network; however, they must be authorized for certain treatments by their primary care physician. For PPOs, patients have more flexibility in choosing the provider of their care in addition to accessing discounted rates.

Health Savings Accounts (HSA’s)

Health Savings Accounts (HSA’s), meanwhile, are internet-based savings accounts that are funded by the patient and used to pay for qualified medical expenses. Funds deposited into an HSA are tax deductible, allowing the contributions to accumulate. The benefit of this plan is that the patient can save money by not spending it on his or her healthcare needs. HSA’s are most commonly paired with High-Deductible Health Plans (HDHP’s). An HDHP operates like a traditional health plan, but with a higher amount of upfront costs in order to reduce the overall monthly premium cost.

Ultimately, each of these health plans exist to serve a purpose. Fee-for-service plans are the most traditional and expensive, managed care plans offer discounted services, health savings accounts offer tax-deductible savings and high-deductible plans offer lower monthly premiums. Understanding each of these health plan options and how they compare is essential to finding the right one for you and your family.