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Planning > Insurance at a Glance

Conventional insurance allows a patient to choose any doctor, and go to virtually any hospital anywhere in the country. You have the assurance that your doctor's medical recommendations are made entirely in your best interest. Managed Care plans are corporations serving large groups of people through a method of financing and delivering health care for a set fee using a network of physicians and other health care providers. The network coordinates and refers patients to its health providers and hospitals, and monitors the amount and patterns of care delivered. Managed care plans usually limit which services patients may receive by using "gatekeepers", or primary care physicians, to make sure services considered unnecessary, or referrals outside the network are kept to a minimum.

An HMO (Health Maintenance Organization) is the most common form of "managed care". It is a group that contracts with medical facilities, physicians, employers and sometimes individual patients to provide medical care to a group of individuals. This care is usually paid for by an employer at a fixed price per patient. Patients generally do not have any significant "out-of-pocket" expenses. An HMO may, however, control the amount of health care the doctor is allowed to provide. Many HMOs require that you choose a primary care doctor from their list. Unless this practitioner decides your medical problem is outside his expertise, you may not receive approval to see a specialist. Likewise, many HMOs limit patients to selected hospitals.

A PPO (Preferred Provider Organization) is a managed care organization that contracts with a network of doctors, hospitals and other health care providers who deliver services for set fees, usually at a discount to the managed care organization. In a PPO, consumers must choose primary health providers from an approved list and must pay extra for specialty services received outside the PPO group.

A POS (Point of Service Plan) is a health plan whose members can choose their services when they need them, either in the HMO or from a provider outside the HMO, at some cost to the member, or a plan in which the primary provider directs services and referrals.

Medicare is a health insurance program for people 65 years of age and older, some people with disabilities under age 65 and people with end-stage renal disease requiring dialysis or transplant. Medicare has two parts, Part A and Part B.

Part A covers hospital insurance; most people do not have to pay for Part A. This helps pay for care in hospitals as an inpatient, critical access hospitals (small facilities in rural areas with limited inpatient and outpatient services), skilled nursing facilities, hospice care and some home health care.

Part B covers medical insurance; most people pay monthly for Part B. This helps pay for doctors, services, outpatient hospital care and some other medical services that Part A does not cover, such as physical and occupational therapy and some home health care. Part B helps pay for these services when they are medically necessary.

Medicaid is a jointly funded federal/state health insurance program for certain low-income and needy people. It covers approximately 36 million individuals including children, the elderly, the blind and/or disabled and people who are eligible to receive federally assisted income maintenance payments.