A PPO network gives the member flexible benefit design options at an affordable price. Your employees will have a wide range of benefits and the freedom to visit any doctor they choose. Benefits will be paid at a higher level when the doctor is in the plan’s provider network.
An HMO network typically provides lower premiums and in-network costs. The member must choose a primary care physician who is in-network who will coordinate their care. Out-of-network benefits are limited or unavailable.
It's important to gain a basic understanding of these common terms. That way, it's easier to settle on a plan that suits your business.
A deductible is the amount the member pays for most covered services before their health plan starts to pay. The deductible resets at the beginning of the calendar year or when the member enrolls in a new plan.
A premium is the ongoing amount that must be paid for a health plan to remain active. The employer and employee usually pay it monthly, quarterly or yearly. The premium isn’t the only amount the member pays for insurance coverage. Typically, they will also have a copay and deductible amount.
The out-of-pocket maximum is most a member will pay for covered services in a plan year. After the member spends this amount on deductibles, copays and coinsurance, the health plan pays 100 percent of the costs of covered benefits. The out-of-pocket maximum doesn't include the premium or anything spent that the plan doesn't cover.
Coinsurance is the percentage of the costs of a covered health care service or prescription drug the member pays after they've met their deductible. A plan that has 60%/40% coinsurance means the company covers 60 percent of the costs and the member is responsible for 40 percent of the costs.
Once the goals are weighed against the cost of a small business health plan, it is time to select a health care plan.