Last week, we learned about Life Insurance and Disability Insurance. Those are for ‘worst case scenarios’. Let’s talk about the insurance questions that slap you in the face every time you get a new job… the dreaded Health Insurance. PPO or HMO? Out of Pocket or Deductible? These can get confusing, but it can be (over) simplified to help you make a decision.
*To be clear, I am not a licensed professional, and this is not to be considered professional advice. The articles in this series are to be considered good ideas and nothing more.*
HMO or PPO?
HMO Plans are generally loathed by the general propaganda. Doctors hate it because of the red tape they have to go through to get paid. Patients hate it because they need an in-network referral to get an in-network referral to see someone about something specific. So why choose an HMO plan? For one, it’s cheaper – inconvenience is cheap. Second, for general purpose patients who don’t need a lot of specialists, it can make a lot of financial sense. If your regular/favorite doctor accepts HMO and is in your network, you probably have a relatively low co-pay and a maximum out-of-pocket expense.
Once you hit the max out-of-pocket, your medical expenses are pretty much gone for the rest of the plan year. Granted, sometimes the out-of-pocket cap is WAY higher than you’d ever reasonably hit, but that’s how they justify the lower monthly premiums that you ‘enjoy’. If (worst case) you need very expensive procedures or hospital stays, your expenditure is capped, and your insurance covers the rest. (After you’ve gotten all of the proper referrals, of course)
PPO Plans are generally preferred by the local propaganda because they give you freedom. Every plan varies on coverage, but you don’t need a referral to see a specialist like you do with an HMO. However, you probably need to reach your entire deductible before those medical expenses are covered by insurance – and at that point, it’s usually a percentage of the cost, not the cost in full. PPO Plans are more expensive overall, but you can get a better chance of getting the care you need if you’re not jumping through the HMO hoops.
About the Author: Abby Dryer's goal in life is to bridge the communication gap between men and women. She finds herself giving lots of marital advice to her guy friends whose wives don’t want to have to explain *everything* to their husbands. “Women are hard to understand. I’m a woman, and *I* don’t even get us sometimes! Goodhusbanding is a great guide to help men understand their women, and hopefully communicate with a little more confidence, because that’s what works… communication!”