Choosing the right health insurance policy can be confusing and difficult. There are a lot of different policies and services available. You must have a basic understanding of the different insurance types before you can make an informed decision to what policy is best for you.

When looking at insurance payments, there are really three kinds of payments. These include the premium, a co-payment, and a deductible. All insurance plans will have a premium, which is the amount that you pay directly to the insurance company. It usually an annual amount oftentimes is split into monthly payments. A co-payment is a payment that you make to the health care provider before they provide medical services and is almost always a set amount. A deductible is the payment that you make towards a hospital bill before the insurance company pays the rest. Deductibles are usually a set amount or a percentage of a bill.

Furthermore, there are four major types of insurance coverage. Health insurance policies can be split into HMO, POS, PPO, and FFS. Each of these services has significant differences as well as their own advantages and disadvantages.

Oftentimes, the cheapest policy offered by insurance companies is the HMO. An HMO is a plan where you are assigned a primary care physician. This doctor is responsible for all of your health care needs. If you need to see a specialist or other doctor, they have to refer you. If you seek treatment from another doctor without a referral, you will be responsible to pay the entire medical bill. However, premiums and co-payments are very low.

The point of service (POS) plan is considered the next step up. With a POS plan, you still have a primary physician, get referrals for specialized care, and make co-payments. The difference between an HMO and a POS is that you have the option to seek care from other doctors, but you will have to pay a deductible for that care. The premium is also more expensive.

A health insurance plan that is gaining popularity is the PPO. PPOs do not have assigned physicians, but rather a network of physicians. You are free to see any doctor within the PPO network, which usually encompasses doctors of almost all specialties, for a low co-payment. Yet, you still have the option to seek care outside the network by paying a deductible.

The FFS plan is the most flexible and usually the most expensive. This plan allows you to choose any doctor that you would like. Some insurance companies offer this policy with a co-payment, but more often that not it will be a deductible. Insurers will typically add a cap to this service as well. You are responsible for paying for any costs that exceed the cap.

There are a lot of different health care plans available. Each plan has advantages and disadvantages, so you will have to choose what works best for you. When you choose an insurance policy, however, it is important that you understand all of the terms and conditions of the policy before committing to it.

Learn about the advantages of having complete health insurance coverage now! When you have private medical insurance, you will have more options on the type of care you select.