What do Indemnity, PPO, HMO and POS mean and what is the difference between them?
INDEMNITY A fee-for-service (FFS) traditional payment plan. The covered person and the insurance carrier pay a percentage of the allowable charge for the service rendered. The policy holder may choose the physician, hospital or other healthcare provider without restriction. Pre-set deductibles are required (often referred to as 80/20 plan). PPO (Preferred Provider Organization) – Also a fee-for-service plan, but the covered person is required to use a physician, hospital or healthcare provider from the plan’s Preferred Provider list for in-network benefits. Usually PPO contracts provide significantly better benefits in exchange for the policy holder’s agreement to stick to the preferred providers. If you use out-of-network providers, your out-of-pocket expenses will be higher, and some services may not be covered. HMO (Health Maintenance Organization) An HMO is a group that contracts with medical facilities, physicians, employers and sometimes individual patients to provide medical car
