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Reason for Insurance… Continued

Oct 28th, 2009

insuranceSelf-employed and family medical insurance is a preferred type of insurance coverage made available to all entrepreneurs and their families. This is for the insurance companies to sell direct to the individual forming a bound contract between the person and the insurance provider. This is the specialized, though very expensive insurance policy available to the unemployed or self-employed, an individual health insurance policy is always an option, but not an inexpensive one.

Medical health benefits will further classify into fee-for-service or as they are called, indemnity or traditional insurance, and to managed care policies. Both the group insurance plan and the individual insurance plan can be either a fee-for-service or a managed care plan. There are three managed care insurance plans to choose.

  1. The Health Maintenance Organizations or HMO
  2. The Preferred Provider Organizations or PPO
  3. The Point-of-Service or POS

The managed care coverage plans typically use medical health provider networks. These networks agree to perform services for managed care plan patients at pre-negotiated rates and will usually submit the claim or claims to the insurance company. In general the self-employed have a lower out-of-pocket expense with the managed care health coverage plan and a broader choice of medical care providers with an indemnity plan.

Each of the three provider insurance plans offer substantial health care coverage benefits to the individual members. If the individual is fortunate enough to have a choice of plan, think of the advantages, and disadvantages. Compare the cost of care, the difference in premiums, deductible amounts and the freedom to choose a medical doctor outside the insurance provider plan. There is a variety of other coverage to consider also, from the prescription drug programs to dental to alternative therapies.

Indemnity or fee-for-service medical insurance plans usually cover the same expenses as managed care does operating with low cost health insurance. The main difference is the medical doctor is asking for pay for each visit with the claim filed by either the individual patient or the medical insurance provider. Unlike many of the managed care coverage plans, fee-for=service allows the individual a large amount of personal freedom to choose which medical doctors and hospitals to utilize.

However, the individual prepares to pay an annual deductible before the medical insurance provider begins to pay on the turned in claims. There are also times when an Indemnity plan will require the individual to pay up front for services rendered before submitting the insurance claims.


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