Most people want the security of knowing that they will not suffer disastrous financial consequences of huge medical bills. There are a wide range of insurance options that can protect individuals and families. Choosing the right coverage for your needs is one of the most important financial decisions you will make.

In general, there are two types of coverage: “indemnity” and “managed-care” plans.

• Indemnity plans generally offer you a wider selection of healthcare providers than managed care plans. There are differences among plans regarding which services they will cover and what portion of the total cost they will pay. With most indemnity plans, you pay your medical bills and then obtain reimbursement from the insurance company.
• Managed-care plans come in several different types of plans: HMO, PPO and POS. In all of these, the insurance companies select a network of healthcare providers who perform their services at pre-negotiated rates. You must choose your healthcare providers from within their designated network. These providers usually submit their bills to the insurance company. The result is that you have less paperwork and lower costs.

INDEMNITY HEALTH INSURANCE		MANAGED CARE HEALTH INSURANCE
You will likely have a wider selection of healthcare providers. The company determines what types of care its plans will cover and what percent of the costs it will pay. Most indemnity policies have a “deductible” amount. You pay medical bills, then seek reimbursement		You will likely have fewer choices of healthcare providers. The insurance company negotiates rates with their providers and pays them directly. Most PPO and POS plans include a “deductible,” while most HMOs do not. You will have less paperwork and out-of-pocket costs.

Within the managed care category, there are three types of medical insurance plans: Heath Maintenance Organizations (HMO), Preferred Provider Organizations (PPO), and Point of Service (POS). There are many variations within these categories, as well.
 

HMO Health Maintenance Organization		PPO Preferred Provider Organization		POS Point of Service
Generally, HMOs allow you less flexibility in choosing physicians or hospitals. You will have no coverage at all for any medical care outside of your HMO network. You will, however, have a broader range of preventive healthcare services available. You will be required to choose a primary care physician (PCP) who will take care of most of your needs. In order to see a specialist, your PCP must make a referral. If you do not obtain this referral, your HMO will not cover the cost of your appointment or services provided. Generally, you will not have to submit a claim form. Most plans require you to make a modest co-payment for each service or medicine. Most HMO plans do not have a deductible Usually you will have lower out-of-pocket costs.		PPOs contract with a network of healthcare providers to offer services to their plan members at a discounted rate. You will not be required to choose a primary care physician (PCP), and you will be able to go to specialists within the network at your own discretion. Most plans will have a specific “deductible” amount – in other words, each year, you must pay all of your medical costs until they total your deductible amount. You will be likely to have a modest co-payment or be required to pay a certain portion of the total charges. If you go to healthcare providers outside the network, the PPO usually pays a lower percentage of the total bill.		POS plans offer more flexibility than an HMO and less than a PPO. In a POS plan, you select a primary care physician from a list of participating providers. All of your medical care is directed by this doctor, who will refer you to specialists within the network, when necessary. If your doctor refers you to out-of-network specialists, you must pay the bill and then submit claim for reimbursement. The percentage of the cost they cover is lower for out-of-network providers. If you choose to see an out-of-network provider on your own, you will submit a claim but expect to pay most of the cost. Like an HMO, a POS plan emphasizes prevention and healthier lifestyles.

Long-Term Care and Medicare Supplemental Insurance

In addition to the health insurance policies described above, Sprague Insurance also helps individuals to find the most appropriate policies to protect themselves or family members who may require long-term care or who need to supplement their Medicare coverage. For most families, there are financial as well as medical considerations in making these decisions. And sorting through the array of options can be bewildering. Our Sprague agents have the expertise to help you understand your options and determine the best insurance program for your individual needs, and the commitment to providing genuinely helpful service.