Plan Types
Plan Types
Choose a Plan and Enroll
Different types of plans help you get and pay for care differently.
Fee-For-Service (FFS) plans generally use two approaches.
Fee-for-Service (FFS) Plans (non-PPO) - A traditional type of insurance in which the health plan will either pay the medical provider directly or reimburse you after you have filed an insurance claim for each covered medical expense. When you need medical attention, you visit the doctor or hospital of your choice. This approach may be more expensive for you and require extra paperwork.
Fee-for-Service (FFS) Plans with a Preferred Provider Organization (PPO) - An FFS option that allows you to see medical providers who reduce their charges to the plan; you pay less money out-of-pocket when you use a PPO provider. When you visit a PPO you usually won't have to file claims or paperwork. However, going to a PPO hospital does not guarantee PPO benefits for all services received within that hospital. For instance, lab work and radiology services from independent practitioners within the hospital may not be covered by the PPO agreement. Most networks are quite wide, but they may not have all the doctors or hospitals you want. This approach usually will save you money.
Generally enrolling in a FFS plan does not guarantee that a PPO will be available in your area. PPOs have a stronger presence in some regions than others, and in areas where there are regional PPOs, the non-PPO benefit is the standard benefit. In "PPO-only" options, you must use PPO providers to get benefits.
Health Maintenance Organization (HMO) - A health plan that provides care through a network of physicians and hospitals in particular geographic or service areas. HMOs coordinate the health care service you receive and free you from completing paperwork or being billed for covered services. Your eligibility to enroll in an HMO is determined by where you live or, for some plans, where you work. Some HMOs are affiliated with or have arrangements with HMOs in other service areas for non-emergency care if you travel or are away from home for extended periods. Plans that offer reciprocity discuss it in their brochure. HMOs limit your out-of-pocket costs to the relatively low amounts shown in the benefit brochures.
- The HMO provides a comprehensive set of services - as long as you use the doctors and hospitals affiliated with the HMO. HMOs charge a copayment for primary physician and specialist visits and generally no deductible or coinsurance for in-hospital care.
- Most HMOs ask you to choose a doctor or medical group to be your primary care physician (PCP). Your PCP provides your general medical care. In many HMOs, you must get authorization or a "referral" from your PCP to see other providers. The referral is a recommendation by your physician for you to be evaluated and/or treated by a different physician or medical professional. The referral ensures that you see the right provider for the care most appropriate to your condition.
- Care received from a provider not in the plan's network is not covered unless it's emergency care or the plan has a reciprocity arrangement.
HMO Plans Offering a Point of Service (POS) Product - In an HMO, the POS product lets you use providers who are not part of the HMO network. However, you pay more for using these non-network providers. You usually pay higher deductibles and coinsurances than you pay with a plan provider. You will also need to file a claim for reimbursement, like in a FFS plan. The HMO plan wants you to use its network of providers, but recognizes that sometimes enrollees want to choose their own provider.
Some plans are Point Of Service (POS) plans and have features similar to both FFS plans and HMOs.
Consumer-Driven Health Plans (CDHP) — Describes a wide range of approaches to give you more incentive to control the cost of either your health benefits or health care. You have greater freedom in spending health care dollars up to a designated amount, and you receive full coverage for in-network preventive care. In return, you assume significantly higher cost sharing expenses after you have used up the designated amount. The catastrophic limit is usually higher than those common in other plans.
Health Reimbursement Arrangement (HRA) - Health Reimbursement Arrangements are a common feature of Consumer-Driven Health Plans. They may be referred to by the health plan under a different name, such as Personal Care Account. They are also available to enrollees in High Deductible Health Plans who are ineligible for an HSA. HRAs are similar to HSAs except an enrollee cannot make deposits into and HRA, a health plan may impose a ceiling on the value of an HRA, interest is not earned on an HRA, and the amount in an HRA is not transferable if the enrollee leaves the health plan.
Health Savings Account (HSA) - A Health Savings Account allows individuals to pay for current health expenses and save for future qualified medical expenses on a pretax basis. Funds deposited into an HSA are not taxed, the balance in the HSA grows tax-free, and that amount is available on a tax-free basis to pay medical costs. To open an HSA, you must be covered under a High Deductible Health Plan and cannot be eligible for Medicare or covered by another plan that is not a High Deductible Health Plan or a general purpose HCFSA or be dependent on another person's tax return. HSAs are subject to a number of rules and limitations established by the Department of Treasury. Visit www.ustreas.gov/offices/public-affairs/hsa/ for more information.
High Deductible Health Plan (HDHP) - A High Deductible Health Plan is a health insurance plan in which the enrollee pays a deductible of at least $1,200 (Self Only coverage) or $2,400 (family coverage). The annual out-of-pocket amount (including deductibles and copayments) the enrollee pays cannot exceed $5,800 (Self Only coverage) or $11,600 (family coverage). HDHPs can have first dollar coverage (no deductible) for preventive care and higher out-of-pocket copayments and coinsurance for services received from non-network providers. HDHPs offered by the FEHB Program establish and partially fund HSAs for all eligible enrollees and provide a comparable HRA for enrollees who are eligible for an HSA. The HSA premium funding or HRA credit amounts vary by plan.
Comparing the Types of Plans
You are in an FFS plan and do not use the PPO (or one is not available):
- You will generally pay more when you get care
- Fewer preventive health care services may be covered
- You will have to file claims for services yourself
You are in an FFS plan and use the PPO:
- You will generally pay less when you get care
- More preventive health care services may be covered
- You may have less paperwork
You are in an FFS plan's "PPO-only" option:
- You must use network providers to get benefits
- You will generally pay copayments and have no deductibles
- You will have little, if any, paperwork
You belong to an HMO:
- You will have limitations on the doctors and other providers you can use
- You will usually pay less when you get care
- You will have little, if any, paperwork
- More preventive health care services may be covered
You belong to a POS plan and use only the providers in that network:
- You will pay less when you get care
- You will get full network benefits and coverage
- You will have very little paperwork
You belong to a POS and do not use network providers or referral procedures:
- You will pay more when you get care
- Some services may not be covered out of network at all
- You generally have to file claims for services yourself
Be sure to look at the primary care physicians, specialists, and hospitals with whom your health plan contracts(the provider network). Does it promote prevention and early detection and intervention? Does it have the specialists to treat your chronic condition? Does it contract with a hospital close to your home?
You belong to an HDHP and use only the providers in that network:
- You will usually pay less when you get care
- Preventive care is often covered in full, usually with no or only a small deductible or copayment