Easy, simple health insurance breakdown - LivewellNebraska.com
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Easy, simple health insurance breakdown

Are you shopping for health insurance and wondering what type of coverage is best for you and your family?

Here are summaries of the three most common types of health insurance and how they compare: Health Maintenance Organizations (HMOs), Participating Provider Options (PPOs) and Consumer Directed Health Plans (CDHPs). (Source: Blue Cross and Blue Shield of Illinois)

HMOs

An HMO gives you access to certain doctors and hospitals, often called network or contracting doctors and hospitals (sometimes called "providers").


• When you sign up, you select a primary care physician (PCP) from a network of doctors.
• Your PCP is your first point of contact for most of your basic health care needs.
• If you need special tests or need to see a specialist, your PCP will give you a referral to see another doctor.
• HMOs generally have lower up-front costs, or monthly premiums.
• They usually feature low deductibles or no deductible at all. A deductible is the amount you pay out-of-pocket before your insurance kicks in to pay medical expenses.
• HMOs usually feature low copayments as well. Copayments are the amount you pay when you visit a doctor or facility.
• If you seek care outside the network, your care may not be covered at all.

PPOs

Like HMOs, PPOs often feature a network of doctors, specialists and hospitals; however, there are some key differences.


• With a PPO, you don't have to choose a primary care physician.
• You have the option of receiving care from doctors, hospitals and specialists in the network or outside the network, and you don't always need a referral to see a specialist.
• PPO monthly premiums are generally higher than HMOs, which means you'll have to pay more up front.
• When you receive care from a doctor or hospital that is in the network, your costs tend to be lower.
• When you receive care from a doctor or hospital outside the network your costs are likely to be higher, and, in some cases, your care may not be covered at all.
• PPO plans usually have a deductible. So, for example, if your PPO plan has a $500 deductible, your coverage doesn't begin until you've paid out-of-pocket for the first $500 of your own medical expenses. Some preventive care services are not subject to the deductible.

CDHPs and the HSA Option

Consumer Directed Health Plans (CDHPs) often involve pairing a high deductible PPO plan with an account you can spend out of—such as a Health Savings Account (HSA)—that gives you certain tax advantages.


• If the plan uses a PPO network, you don't have to choose a primary care physician.
• You have the option of receiving care from doctors, hospitals and specialists in the network or outside the network, and you don't always need a referral to see a specialist.
• When a CDHP includes a high-deductible health plan, premiums are often lower than other types of coverage because you are responsible for a greater share of your health care costs.
• If the health plan is an HSA-qualified high deductible health plan, and you are an HSA-eligible individual, you may establish an HSA and make contributions to the account each year.
• An HSA is a savings account that you can use to cover a wide range of qualified medical expenses. HSAs have special tax advantages and are regulated by the U.S. Treasury Department.

Learn more about these and other types of health insurance coverage.




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