Features of Private Payer and Consumer-Driven Health Plans

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Features of Private Payer and Consumer-Driven Health Plans

When it comes to health care plans there are government-sponsored programs and then there are private payer plans which consist of Preferred Provider Organizations (PPO), Health Maintenance Organizations (HMO), group Health Maintenance Organizations, Independent Practice Association Model (IPA), Point-of-Service Plans (POS), Indemnity Plans, and Consumer-Driven Health Plans (CDHP). When choosing a health-care plan it is important to research the basic definitions, what types of services are covered, and payment requirements (Axia College. 2009. Week One Supplement Chapter 9). One of the most popular health care plans is the PPO which offers a discounted fee-for-service program which means specific providers get paid based on their discounted services. This type of plan requires a patient to pay an annual premium rate and deductible and can consist of either a low deductible, high premium or a high deductible, low premium. Patients must pay a copayment at the time of medical treatment and must be seen by a physician on this network’s list or pay a higher price for service (Axia College. 2009. Week One Supplement Chapter 9). An HMO is licensed by the state and has lower costs because it consists of more regulated guidelines for their limited list of providers. Patients must be treated by physicians that are listed under their network to be covered. This plan charges annual premiums and copayments for each visit but there is no deductible that is required. This is called “first-dollar coverage” and patients do not have an out-of-pocket cost (Axia College. 2009. Week One Supplement Chapter 9). A group HMO is very similar to an HMO except that it has contracts with more than one group of physicians. Medical facilities are paid by a per member per month (PMPM) rate for each patient they treat. Certain services may be hired out as needed and a flat fee is charged for services of any...
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