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Health Plan Types

Are a form of managed care organization that typically provide health benefits coverage for a pre-arranged set of comprehensive medical services to an enrolled group (most often the employees of a single business or a group of businesses, such as a chamber of commerce or trade association). A more limited number of HMOs and other managed care organizations offer coverage to individual consumers directly. In most cases, patients are restricted to using health care providers who have contracted with the HMO to serve on the provider panels which form the basic health care provider network structure within a specific HMO. Characteristically, a primary care physician (usually a general practitioner, internist or Ob-Gyn) is chosen by a plan member from the HMO’s extensive listing of provider panel participants who subsequently serves to coordinate care for the member. Hospitals and providers may contract to provide health care services with several different HMOs.

The health plan contracts with a group of physicians who are organized as a partnership, professional corporation, or other association. The health plan compensates the medical group for contracted services at a negotiated rate, and that group is responsible for compensating its physicians and contracting with hospitals for care of their patients.

The HMO contracts with a network of health professionals to provide services to the HMO’s members. Physicians work out of their own offices, and also accept patients who do not belong to the HMO.

Usually organized by an HMO, plan members receive care from participating providers, but have the option of obtaining care outside the provider network, usually at a higher cost to the member through deductibles and co-payment fees. Many HMOs offer a POS product in addition to their basic programs.

In staff model HMOs, providers are directly employed by the HMO.

a system in which a third party (e.g. an insurer, employer, third party administrator, or other sponsoring group) negotiates discounted rates for services from a specific network of hospitals and providers on behalf of those enrolled in the plan. Patients insured under a PPO plan may see other providers, but at a higher cost to the patient.