Individual Health Care Plans
Individual Health Care Plans
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If you work for someone else, your health care choices are somewhat limited. But the choices in the individual health insurance market can be much more comprehensive. Unfortunately, the individual health insurance market can also be quite confusing and tricky to navigate. Understanding the various choices you have will make shopping a lot easier.
Preferred Provider Organization
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Preferred Provider Organization (PPO) plan is when the insurance company negotiates favorable rates with doctors, hospitals, medical clinics, pharmacies and other health care providers. This allows the insurance company to enjoy lower costs and those costs can be passed along to consumers in the individual market. The key to shopping for a PPO is to make sure that the hospitals, doctors and pharmacies you use are included in the network. If you need to use an out-of-network provider, you will typically pay much higher deductibles and co-payments.
Health Maintenance Organization
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Health Maintenance Organization (HMO) are popular in the individual marketplace. With an HMO, consumers choose a primary care physician who coordinates all patient care, from basic physicals and wellness exams to referrals to specialists for more complex care. It is important for consumers to weigh the benefits of each HMO offered before making a decision. It is also critical to make sure that the doctor you currently use participates in the HMO and would be willing to take on the role of primary care physician.
High-Deductible Health Plan
Self-employed people and those who lack coverage through a job might be able to save significant money on their premiums by shifting some of the risk from the insurance company to themselves. With a high-deductible health plan, known in insurance company lingo as an HDHP, individuals accept a higher deductible than traditional PPO and HMO plans offer. The deductible for an HDHP varies but can be as high as $10,000. As with any type of insurance, as the deductible goes up, the monthly premium goes down. Individuals who choose this type of plan often use a health savings account, or HSA, to fund the deductible. The money in an HSA can be used to cover those higher deductibles and to pay other out-of-pocket expenses. The money invested in an HSA could also be tax-deductible, providing another important benefit. In addition, the money rolls over from year to year, so there is no need to use the money in the plan in a single year.