There are two basic types of health insurance plans available today. There is the traditional care health plan and the managed health care plan. We will examine the traditional health care plan and help you distinguish between the two.
Traditional care insurance can also be known as “fee for services” or “indemnity plans”. Traditional care insurance plans have the following features:
You usually pay a higher out of the pocket expense at the time of service. This can also include expenses up to a set deductible limit.
Once you meet the deductible limits, you then share the bill with the insurance company. For instance, your insurance company may pay 80 percent and you have to pay 20 percent. You will continue to share the bill until you reach your maximum out of pocket expenses. After this the insurance company will pay 100 percent of expenses up to its cap.
You could be responsible for keeping your own records of expenses. You might have to submit a request for reimbursement from your insurance company.
The insurance corporation will only pay for usual and customary expenses. Any additional charges or expenses will have to come out of your pocket.
Not every insurance company will offer a wellness or preventative care with this type of plan.
The traditional insurance corporation usually has very few restrictions on which medical providers and specialists you can see and use.
If your plan is a catastrophic or high deductible major medical health plan, you will generally have lower annual premiums than a plan with a lower deductible.
Today, traditional health care plans are becoming increasingly hard to find, as most insurance companies are switching to a managed care plan solution.