Different Types of Health Plans: How They Compare

You have choices when you shop for health insurance. If you're buying from your state's Marketplace or from an insurance broker, you'll choose from health plans organized by the level of benefits they offer: bronze, silver, gold, and platinum. Bronze plans have the least coverage, and platinum plans have the most. If you are under 30, you may also be able to buy a high-deductible, catastrophic plan.

How are the plans different? Each one pays a set share of costs for the average enrolled person. The details can vary across plans. In addition, deductibles -- the amount you pay before your plan picks up 100% of your health care costs -- vary according to plan, generally with the least expensive carrying the highest deductible.

• Platinum: covers 90% on average of your medical costs; you pay 10%
• Gold: covers 80% on average of your medical costs; you pay 20%
• Silver: covers 70% on average of your medical costs; you pay 30%
• Bronze: covers 60% on average of your medical costs; you pay 40%
• Catastrophic: Catastrophic policies pay after you have reached a very high deductible ($8,150 in 2020). Catastrophic plans must also cover the first three primary care visits and preventive care for free, even if you have not yet met your deductible.

You will also see insurance brands associated with the care levels. Some large national brands include Aetna, Blue Cross Blue Shield, Cigna, Humana, Kaiser, and United.

Each insurance brand may offer one or more of these four common types of plans:

• Health maintenance organizations (HMOs)
• Preferred provider organizations (PPOs)
• Exclusive provider organizations (EPOs)
• Point-of-service (POS) plans
• High- deductible health plans (HDHPs), which may be linked to health savings accounts (HSAs)

Take a minute to learn how these plans differ. Being familiar with the plan types can help you pick one to fit your budget and meet your health care needs. To learn the specifics about a brand's particular health plan, look at its summary of benefits.

Health Maintenance Organization (HMO)

An HMO delivers all health services through a network of healthcare providers and facilities. With an HMO, you may have:

• The least freedom to choose your health care providers
• The least amount of paperwork compared to other plans
• A primary care doctor to manage your care and refer you to specialists when you need one so the care is covered by the health plan; most HMOs will require a referral before you can see a specialist.

What doctors you can see. Any in your HMO's network. If you see a doctor who is not in the network, you'll may have to pay the full bill yourself. Emergency services at an out-of-network hospital must be covered at in-network rates, but non-participating doctors who treat you in the hospital can bill you.

What you pay:

• Premium: This is the cost you pay each month for insurance.
• Deductible: Your plan may require you to pay the amount before it covers care except for preventive care.
• Copays and/or co-insurance for each type of care. A copay is a flat fee, such as $15, that you pay when you get care. Coinsurance is when you pay a percent of the charges for care, for example 20%. These charges vary according to your plan and they are counted toward your deductible.

Paperwork involved. There are no claim forms to fill out.

Preferred Provider Organization (PPO)

With a PPO, you may have:

• A moderate amount of freedom to choose your health care providers -- more than an HMO; you do not have to get a referral from a primary care doctor to see a specialist.
• Higher out-of-pocket costs if you see out-of-network doctors vs. in- network providers
• More paperwork than with other plans if you see out-of-network providers

What doctors you can see. Any in the PPO's network; you can see out-of-network doctors, but you'll pay more.

What you pay:

• Premium: This is the cost you pay each month for insurance.
• Deductible: Some PPOs may have a deductible. You will likely have to pay a higher deductible if you see an out-of-network doctor.
• Copay or coinsurance: A copay is a flat fee, such as $15, that you pay when you get care. Coinsurance is when you pay a percent of the charges for care, for example 20%.
• Other costs: If your out-of-network doctor charges more than others in the area do, you may have to pay the balance after your insurance pays its share.

Paperwork involved. There's little to no paperwork with a PPO if you see an in- network doctor. If you use an out-of-network provider, you'll have to pay the provider. Then you have to file a claim to get the PPO plan to pay you back.

Exclusive Provider Organization (EPO)

Exclusive Provider Organization (EPO)

With an EPO, you may have:

• A moderate amount of freedom to choose your health care providers -- more than an HMO; you do not have to get a referral from a primary care doctor to see a specialist.
• No coverage for out-of-network providers; if you see a provider that is not in your plan’s network – other than in an emergency – you will have to pay the full cost yourself.
• Lower premium than a PPO offered by the same insurer

What doctors you can see. Any in the EPO's network; there is no coverage for out-of-network providers.

• Premium: This is the cost you pay each month for insurance.
• Deductible: Some EPOs may have a deductible.
• Copay or coinsurance: A copay is a flat fee, such as $15, that you pay when you get care. Coinsurance is when you pay a percent of the charges for care, for example 20%.
• Other costs: If you see an out-of-network provider you will have to pay the full bill.

Paperwork involved. There's little to no paperwork with an EPO.

Point-of-Service Plan (POS)

A POS plan blends features of an HMO with a PPO. With POS plan, you may have:

• More freedom to choose your health care providers than you would in an HMO
• A moderate amount of paperwork if you see out-of-network providers
• A primary care doctor who coordinates your care and who refers you to specialists

What doctors you can see. You can see in-network providers your primary care doctor refers you to. You can see out-of-network doctors, but you'll pay more.

What you pay:

• Premium: This is the cost you pay each month for insurance.
• Deductible: Your plan may require you to pay the amount of a deductible before it covers care beyond preventive services.You may pay a higher deductible if you see an out-of-network provider.
• Copays or coinsurance: You will pay either a copay, such as $15, when you get care or coinsurance, which is a percent of the charges for care. Copayments and coinsurance are higher when you use an out-of-network doctor.

Paperwork involved. If you go out-of-network, you have to pay your medical bill. Then you submit a claim to your POS plan to pay you back.

Catastrophic Plan

If you are under the age of 30 you can purchase a catastrophic health plan. With a catastrophic health plan you may have:

• Lower premium
• 3 primary care visits before the deductible applies
• Free preventive care, even if you haven’t met the deductible

What doctors you can see. Any in the plan’s network; individual plans may have additional rules on specialists.

What you pay:

• Premium: This is the cost you pay each month for insurance.
• Deductible: A catastrophic health plan has a deductible of $8,150 for an individual and $16,300 for a family in 2020. After you reach that deductible, the plan will pay 100% of your medical costs for covered benefits.

Paperwork involved. You will want to keep track of your medical expenses to show you have met the deductible.

High-Deductible Health Plan With or Without a Health Savings Account

Similar to a catastrophic plan, you may be able to pay less for your insurance with a high-deductible health plan (HDHP). With an HDHP, you may have:

• One of these types of health plans: HMO, PPO, EPO, or POS
• Higher out-of-pocket costs than many types of plans; like other plans, if you reach the maximum out- of-pocket amount, the plan pays 100% of your care.
• A health savings account (HSA) to help pay for your care; the money you put in an HSA is not taxed and can be used tax-free on eligible medical expenses. In order to have a HSA, you must be enrolled in a HDHP.
• Many bronze plans may qualify as HDHPs depending on the deductible (see below).

What doctors you can see. This varies depending on the type of plan -- HMO, POS, EPO, or PPO

What you pay:

• Premium: An HDHP generally has a lower premium compared to other plans.
• Deductible: The deductible is at least $1,400 for an individual or $2,800 for a family, but not more than $6,900 for an individual and $13,800 for a family in 2020. Like with all plans, your preventive care is free even if you haven't met the deductible.
• Copays or coinsurance: Other than preventive care, you must pay all your costs up to your deductible when you go for medical care. You can use money in your HSA to pay these costs.

You can set up a Health Savings Account to help pay for your costs. The maximum you can contribute to an HSA in 2020 is $3,550 for individuals and $7,100 for families.

Paperwork involved. Keep all your receipts so you can withdraw money from your HSA and know when you've met your deductible.

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