What is a POS (Point Of Service)?

Several HMOs offer plan members the option to self direct care, as one would under an indemnity plan, rather than get referrals from primary care physicians. An HMO with this opt-out provision is known as a point-of-service (POS) plan. How the plan functions (i.e., like an HMO or like an indemnity plan) depends on what individual plan members decide to do at the “point-of-service.”

Typically, when medical care is needed, the individual plan member has three choices. The plan member can choose to go through his or her primary care physician, in which case services will be covered under HMO guidelines (i.e., usually a co-payment will be required).

Alternatively, the plan member can access care through a PPO provider and the services will be covered under in-network PPO rules (i.e., usually a co-payment and coinsurance will be required).

Lastly, if the plan member chooses to obtain services from a provider outside of the HMO and PPO networks, the services will be reimbursed according to out-of-network rules (i.e., usually a co-payment and higher coinsurance charge will be required). Because people who belong to POS plans are responsible for deciding where to seek care, it is important that they understand the financial implications of these choices.