How to Buy Insurance

Figuring out which different types of health care coverage you need. 

Posted: 10/01/2013 09:50 AM EDT

Different types of health insurance plans meet different needs. When you compare options, it’s important to understand how they are structured.

Organizations (HMOs) and Exclusive Provider Organizations (EPOs)

HMOs and EPOs may limit coverage to providers inside their networks. A network is a list of doctors, hospitals, and other health care providers that provide medical care to members of a specific health plan. If you use a doctor or facility that isn’t in the HMO’s network, you may have to pay the full cost of the services provided.

HMO members usually have a primary care doctor and must get referrals to see specialists. This is generally not true for EPOs.

Preferred Provider Organizations (PPOs) and Point-of-Service plans (POS)

These insurance plans give you a choice of getting care within or outside of a provider network. With PPO or POS plans, you may use out-of-network providers and facilities, but you’ll have to pay more than if you use in-network ones. If you have a PPO plan, you can visit any doctor without a referral.

If you have a POS plan, you can visit any in-network provider without a referral, but you’ll need one to visit a provider out-of-network.

High Deductible Health Plan (HDHP)

High Deductible Health Plans typically feature lower premiums and higher deductibles than traditional insurance plans. As of 2013, HDHPs are plans with a minimum deductible of $1250 per year for individual coverage and $2500 for family coverage.

If you have an HDHP, you can use a health savings account or a health reimbursement arrangement to pay for qualified out-of-pocket medical costs. This can lower the amount of federal tax you owe.

Learn more about HMOs, PPOs and other types of insurance at BlackDoctor.Org.

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 (Photo: Joe Raedle/Getty Images)

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