Low Cost Health Insurance Plans Come In Different Shapes & Sizes

You can find low cost health insurance plans online with a little homework. To get the best deal, first know what kind of health coverage you need. Most plans fall into two categories:

Fee for Service
Traditional Insurance or “fee for service” lets you see any doctor. After your visit, either you or your doctor files a claim for reimbursement from your insurance company. If you go with a high deductible and are generally healthy, you can often keep traditional insurance low cost.

Managed Care
Managed care is a term for PPO (preferred provider organization) and HMO plans (health maintenance organizations). Managed care evolved to try to keep insurance affordable. To do that, the plans place certain limitations on your health care. If you can live with a few restrictions, PPOs and HMOs offer great value. They do have slight differences.

HMOs
Thriftier than PPOs, health maintenance organizations typically require that you use their network physicians, or pay increased rates. You choose a primary care physician who also acts as a “gatekeeper," and makes most of your healthcare decisions. This doctor provides referrals if you want to see a specialist or go outside the HMO network.

PPOs
Preferred provider organization plans let you choose from a network of doctors. You also pick a primary doctor, but don’t need any referrals to see specialists. Gatekeepers are prohibited in these plans and most indemnity-type insurance.

Choosing What's Right For You
The differences between PPOs and HMOs are largely about choice. HMOs pay physicians a so-called “capitation fee” which is a negotiated price for each member of their plan, rather than for specific services rendered. Obviously it’s to the doctor’s advantage to manage your health care efficiently with the fewest office visits possible. With a PPO, your doctor is paid for each visit. If you want more control and more features of traditional insurance, PPOs are a good bet.

HMOs often provide care through sub-networks of doctors and providers, called limited provider or delegated networks. If your primary care physician is part of such a network, you may be limited to only the doctors in that sub-network. HMOs must notify you if this is the case. You can personalize your HMO plan if you sign up for a “rider” or Point of Service plan which allows you to go outside the network and add or subtract certain coverages. Some people feel that HMO cost-cutting strategies can impact the quality of their healthcare. Others just want to keep costs down – for these, HMOs are a good choice.

Insurance or PPO Plan
What you'll pay:

Premiums - monthly amount for insurance coverage.

Deductibles – an agreed-upon amount of covered expenses you pay each year before the policy begins to cover your costs.

Co-insurance - a yearly share of each covered expense, usually 20 percent, or a higher percentage if using out-of-network providers.

Out-of-pocket limit - the maximum you pay in one year when you combine your deductible and co-insurance. The out-of-pocket limit generally starts over each year.

Co-payment – out-of-pocket expense when you receive medical care.

HMO Plan
What you'll pay:

Premiums - monthly amount for coverage.

Co-payment - the amount you pay when you receive medical care or a prescription not fully prepaid. Co-payments usually refer to set fees HMOs charge.

Premiums - monthly amount for coverage.

Co-payment - the amount you pay when you receive medical care or a prescription not fully prepaid. Co-payments usually refer to set fees HMOs charge.

Deductibles - the amount of covered expenses some HMO plans may require you to pay each year before the plan begins to pay. (Most HMOs don’t have deductibles.)

Maximum out-of-pocket expense - the maximum amount you must pay during a certain period for covered expenses. Until the maximum is reached, the covered individual must pay a co-payment.