Health Insurance: Types Of And How To Know Which You Have

Health insurance covers against loss due to illness or bodily injury. The types of health insurance policies available today are primarily defined by the amount of freedom you the insured has when choosing what health care you want and the identity of doctor or other health care provider. 

At the one extreme is the traditional Fee-For-Service (Indemnity) type policy in which the insured has free choice about what care to receive, when to receive it, and who provides it. At the other extreme are managed care plans such as an HMO (Health Maintence Organization) in which the insurer decides the answers to these questions.

Few policies are purely one type or another. Instead, they incorporate features of different types of plans. The types and names keep changing and depend on the company. In general, if we start at the fee-for-service extreme and work our way toward an HMO, there are the following types of health insurance:

• Fee-for-service (also known as "Indemnity")
• PPO: Preferred Provider Organization
• POS: Point Of Service
• IPA: Individual Practice Association
• HMO: Health Maintenance Organization
• High Deductible Plans

There are no studies which indicate whether a particular type of policy is better for a person with a particular health condition. Studies do show that people with serious health conditions receive as good care under managed care plans as under fee-for-service plans.