What types of group health insurance plans are available?
Group health insurance plans are categorized as either indemnity plans (also known as "traditional indemnity," "fee-for-service," or "FFS" plans) or managed care plans. Indemnity and managed care plans differ in their basic approach. Put broadly, the major differences concern choice of providers, out-of-pocket costs for covered services, and how bills are paid. You will typically have a broader choice of doctors (including specialists, such as cardiologists and surgeons), hospitals, and other health care providers with an indemnity plan while you will typically have less out-of-pocket costs and paperwork with a managed care plan.
Indemnity plans once dominated the American health insurance market, but are no longer as popular as they used to be. They are most common on the east coast. Managed care plans now take up a much larger share of the general health insurance market and are especially dominant in the western parts of the country. There are three basic types of managed care plans: PPOs, HMOs, and POS plans.