Network Options, and What they Mean

As you start investigating your Health Insurance options, you will find that each plan is not the same. It is important to understand what you are looking at, so that you can choose and use your plan correctly. Each health plan uses a different type of network. Understanding what these networks actually mean, will point you in the direction of the type of plan that will work best for your situation. This article will go over the most common networks, which are, PPO, HMO, EPO and POS. After reviewing the article, you will have a much better understanding of what these plans will do for you, and where your out-pocket-costs will come from. 

PPO

A PPO stands for Preferred Provider Organization. In my experience, this is the most sought-out plan. This network allows you to choose your own hospitals, doctors and specialists – without needing a referral from your PCP. It allows you to have the coverage you need while traveling, vacationing, and if there’s a big diagnosis and you seek treatment from specialists or hospitals in a different geographic area. For traveling families – especially in the full-time RV world, this is a huge benefit to know your family is protected no matter where you are in the USA. 

There are private plans available that allow you to go anywhere in the country with no added costs. Other plans may have PPO benefits in other states, but cost you a little more out of pocket. You should always read the plan benefits to be sure you understand exactly when and where it will pay. 

You can expect a higher monthly cost for a PPO plan. There will be several options for deductible amounts and co-insurance percentages, keeping your out of pocket costs to a minimum when you use your health care plan. 

HMO

An HMO is a health maintenance organization, and is a very common type of health plan. Many people find themselves choosing an HMO plan because it may be the only type of plan available in their area or, it appeals to them because the monthly cost is lower. 

It is important to truly understand this type of plan before accepting it. Generally, it is not able to be used outside your geographic area. Meaning, if you travel outside your county, you are likely without coverage if something were to happen. Now, in the case of an emergency – they will cover (usually) the emergency bills. But, once you’re stabilized, they stop covering. Let’s say you’re in a car accident. You’re rushed to the ER and they stabilize you. So far, so good. All of that should’ve been covered by your plan, even though you’re out of network. But now, they want to admit you and keep you for observation. Or, maybe you need surgery before you can be released. From the time you are in a stable condition – your coverage is no longer covering you. This is so important – and oftentimes, unknown to consumers. Are you able to pay for the bills that come in once you’re home? 

Another subject that is worth thinking about, is what would you want to do if you are ever diagnosed with cancer, or another tragic illness? Would you want to choose the best specialist in the country? With an HMO plan, you will not have that option. 

Now, I realize that many of us, especially when we’re young and healthy, think we’re invincible, and that will never happen. I hope it never does happen to you! But, the truth of the matter is, it happens all the time to all different ages, races, and walks of life. If you would want to choose your specialist or team of physicians then an HMO may not be for you. 

HMO plans generally focus their coverage on preventative care and more cost-effective strategies to get the care you need. They are able to keep costs lower by having a network of doctors that are contracted to receive a certain rate of pay for certain care they provide. You will probably be required to designate your primary care physician when you obtain the plan, so it is important to be sure your provider is in-network if you don’t want to change providers before selecting your plan. Additionally, you will need a referral from your PCP to see a specialist. 

EPO

An EPO stands for Exclusive Provider Organization. Similar to HMO’s, an EPO will have a pre-selected network of doctors contracted with the health insurance provider to provide you care at a lower rate. Again, these are popular options due to either being the only option in your geographic area, or the price point it is offered at. 

You typically will not be required to pre-select your primary care physician, which offers you more flexibility, but may prohibit continuity of your care down the road. See why, with this video from KFF Health News. Referrals to see specialists are not typically required with EPO plans, but you will still be limited to using physicians inside the network. 

Out of network care will not be provided at all, except in the event of an emergency. The same car accident example given above can be given for the EPO. These plans do try to curate a network of specialists from nearly every specialization, so that you have a wide pool of professionals to choose from. 

Similar to an HMO and a PPO, you may be required to pay deductibles, and co-insurance in addition to your monthly premium. 

POS

POS stands for Point of Service. This means that each time you need healthcare services, you’ll need to decide if you want to stay in-network or not. With this type of coverage, your cost is going to depend on that “point” of service – meaning that provider or facility. 

You will likely need to pre-designate your primary care physician when choosing your plan. Services then provided by that physician are typically not subject to a deductible. Also, preventative care is generally at no cost to you. Similar to a PPO, out-of-network options are usually available to you – but keep in mind, it will be at a higher cost. 

So, if we were to use this coverage for the same car accident example listed above, this means that once you’re stabilized, you will still have insurance coverage. However, you will be responsible for a higher cost, than if you were in-network.

This plan, coming in at a lower monthly cost to you, generally is very limited when it comes to the providers that are in-network. You will also need a referral from your PCP to see a specialist.

It is very important to note that if you’re seeing a physician outside the network, you will likely encounter paperwork before you are allowed, and you will most likely need to pay all of the provider fees upfront. This can put a huge strain on your savings account and budget. Once the service has been rendered, you would then submit the claim to the insurance carrier to be reimbursed. Waiting for that claim to be approved and reimbursed can be daunting and overwhelming. 

After reviewing the different types of plans available, do you feel confident in the plan that is protecting you? Are you unsure? 

Let’s chat. I’m here to help you review so that you are not faced with unexpected costs or unable to get the care you deserve.   

Differences at a Glance

	PPO	HMO	EPO	POS
COST	Higher premiums, greater flexibility in care and location of care	Lower premiums, less flexibility in care and location of care	Lower premiums, less flexibility in care and location of care	Lower premiums, less flexibility in care and location of care
REFERRALS	No referral needed to see specialist	Generally requires referral to see a specialist	Generally does not require a referral to see a specialist	Generally requires referral to see a specialist
OUT OF NETWORK CARE	Care is provided out of network	Care is not provided out of network	Care is not provided out of network	Care is provided out of network, but at a higher cost to you
PRIMARY CARE PHYSICIAN	Pre-designation not required. Direct access to specialists	Requires pre-selection of PCP and coordinating care through that PCP	Pre-designation not required. Direct access to specialists	Requires pre-selection of PCP and coordinating care through that PCP

It’s important to stay up to date with Health Insurance changes. Subscribe to the monthly newsletter so you don’t miss a thing. 

Subscribe Here!

Are you unsure about what Health Insurance even is? Take a look at this article, it will help. 

Still unsure as to whether or not you need coverage? The answer is YES! 

In Short:  PPO networks will offer you the greatest flexibilityPOS insurance plans can be confusing, since they are less common than PPO’s, HMO’s, and EPO’sEven though a POS plan is less expensive, you could wind up paying more than expected if you don’t fully understand your plan.HMO’s are less expensive than PPO plans, but are limited to who you can see.A PPO will cover you out-of-network so you have the peace of mind to know that you’re always covered.POS plans will require extra paperwork, filing your own claims and waiting to be reimbursed for services.A PPO and EPO offers the ability to see a specialist without first getting a referral from your PCP.An HMO’s focus is on preventative care and managing effective costs when you need care.It is important to understand your responsibility when it comes to deductibles and coinsurance before you choose any plan.