Managed Care and Indemnity Plans: Simple Secret to Slashing...

Two health plans that you hear a lot about are managed care and indemnity plans. They are significantly different in their basic approach to health care but, generally speaking, the major difference involves choices.

Managed care plans have pre-existing service contracts that they have entered into with specific hospitals, health care providers, and doctors. A managed care plan will mean less paper work for you and much lower out of pocket expenses. There are 3 types of managed care programs available.

A PPO (preferred provider organization) has its own style when it comes to management and indemnity. You can select medical professionals who are both in the PPO network and those who aren't. The difference between the two options is that when you use an outside provider, you must pay the bill first prior to submitting it to the PPO for reimbursement. Using a PPO physician means you'll pay a small service fee, and then the bill will be sent to the PPO.

A health maintenance organization or HMO requires you to choose a primary care doctor and has a list of approved doctors for you to choose from. A typical HMO plan requires the patient to make a small co-payment with every visit to a doctor but there is no plan deductible.

Indemnity plans have no predefined contracts and can therefore offer a wider choice among health care professionals. They will probably cost you more, however. You normally pay the bill up front and then submit a claim. Deductibles often begin at around $200.00 and may go higher. Plans vary in coverage but usually cover about 80% of the final bill.

Over the years these two types of plans have actually begun to blur. In fact some indemnity plans are beginning to look more like managed care plans.

Be sure to comparison shop using one of the online services offering instant health insurance quotes. These services, sometimes offered at no charge, will have you complete a single, brief form allowing you to receive multiple quotes from insurance agents local to you. Using the information you provide on the form, you and your family members who will be covered by the policy will be evaluated and your risk assessed. This will determine your premiums and any restrictions your policy might have.

The type of health insurance you decide to purchase will depend on your personal needs and the needs of your family. By doing your research and understanding the different types of insurance available, you'll be better equipped to buy the health insurance that's right for you.